Holiday online shopping surge tests UPS network

In a year when consumers have turned to online shopping more than ever, holiday purchases for delivery are already starting to test the shipping capacity at UPS.

Drivers for UPS — the world's largest package-delivery company, based in the Atlanta metro — wrote in online forums this week that they were instructed not to pick up packages at some major retailers as e-commerce orders hit an all-time high Monday.

The shipping restrictions affected retailers including Macy's, Gap, Nike, New Egg, L.L. Bean and Hot Topic, the Wall Street Journal reported Wednesday.

Instead of visiting stores during the coronavirus pandemic, a growing number of customers are ordering goods online from stores, which then ship the goods to customers' homes.

Consumers spent $34.4 billion from Thanksgiving through Black Friday and Cyber Monday this year, according to an analysis by software firm Adobe. Monday was the largest online shopping day in U.S. history, according to Adobe.

UPS is trying to spread out shipments over peak and nonpeak times through a longer holiday shopping period to avoid big spikes in volume. It said it set "specific capacity allocations" last weekend and through the holiday season, and worked to ensure large retail customers "are aware of how much capacity is available to them."

The shipping giant also said it wants to maintain reliability for other customers including small- and medium-size businesses, "which have been hit hardest during the pandemic and are also seeing an increase in holiday volume."

An overloaded shipping network could mean delays for online shoppers waiting for their items to arrive. Industry observers have warned that this year more than ever, consumers should order items early to ensure they are delivered in time for the holidays, or arrange to order online and pick up items at stores.

UPS spends much of the year preparing for the peak holiday season, including setting plans with some of the nation's largest retailers on how much they will ship and when.

UPS also imposed higher holiday shipping surcharges on some of the biggest retailers this year to cope with rising costs and deter retailers from putting in a surge of orders at one time.

The shipper said it has added 20 facilities and 14 planes for the peak holiday season, and is hiring more than 100,000 temporary workers.

E-commerce behemoth Amazon also has been hiring more workers and is encouraging customers to consider consolidating their deliveries or having items delivered to Amazon Hub pickup locations.