Carolina post offices get 1st delivery of FedEx boxes
The post office's blue mailboxes are getting some colorful company.
Today, FedEx will place a purple drop box with its familiar orange, white and purple logo at Charlotte's uptown post office, the first step in the national rollout of its new partnership with the U.S. Postal Service.
The Charlotte region is the test market for the pact which, by Wednesday, will have FedEx drop boxes at 82 post offices in 54 communities in the Carolinas. Within 18 months, FedEx will have 10,000 post office drop boxes nationwide.
The alliance comes at a time when the Postal Service is facing higher costs and losing more money. The deal means the post office gets paid as much as $230 million over seven years, while FedEx can take advantage of a network of convenient locations to boost its business.
In the partnership's second, more pivotal stage, to start in August, the post office will ship express and priority mail, its fastest delivery products, on FedEx airplanes. FedEx will replace other companies, including Emery Worldwide, in that capacity.
"This is a historic alliance," said David Bronczek, president and CEO of FedEx Express, the overnight delivery company and largest subsidiary of FedEx Corp. "The drop boxes give us a great opportunity to add revenue to our existing system and give our customers more flexibility."
In particular, FedEx customers' packages can be dropped off at some post offices as late as 8:30p.m. and still have next-day delivery.
Bronczek called Charlotte the perfect test market because it has both a large number and a good mix of big and small FedEx customers. Bronczek also cited surveys that show Charlotte has a strong small-business economy.
"Charlotte is not Manhattan, but it's a relatively good-sized city where we can make sure things go well," Bronczek said.
Along with the Charlotte post office sites, the rollout will add Fed Ex boxes at post offices in such Charlotte-area cities as Albemarle, Bessemer City, Kannapolis, McAdenville, Salisbury, Wingate, Rock Hill and Fort Mill, S.C.
The focus is on smaller businesses. They are more likely to benefit from the convenience of late drop-offs than high-volume customers, who often have regular on-site FedEx pickups, some as late as 7 p.m.
For the post office, the deal represents an opportunity to profit from its nationwide presence, with 38,000 offices and branches around the country, not counting contract branches located in stores. The $230 million contract with FedEx, announced in January, covers 10,000 offices and branches; the post office is guaranteed $126 million if FedEx uses just 5,000 outlets.
"We have a presence in every community, which makes us attractive as a partner," said Pam Gibert, vice president of retail, consumers and small business for the postal service.
FedEx has said it expects the postal partnership to generate $7.2 billion in revenues, with $6.3 billion coming from the transporting of express and priority mail.
The air cargo portion of the partnership is opposed by Emery, which has filed suit in federal court. "It's anti-competitive and it wasn't bid fairly under the Postal Service's own rules," said Emery spokeswoman Nancy Culvert.
FedEx spokeswoman Carla Boyd said the court denied Emery's January request to prevent the signing of the partnership agreement. "We expect a final decision by March 16, and we are confident it will be consistent with January's decision," she said.
Meanwhile, Boyd said most of the Charlotte-area drop boxes will be installed today. "We want to get this up and running as quickly as possible," she said, "because the more time we have in the first test market, the better if will be."