Delivery giant FedEx is expanding its real estate footprint with an eye on expediting delivery to its customers – especially as it gears up for the holiday package crush. FedEx says it expects record volumes in the coming months, predicting that shipments from Black Friday through Christmas Eve will rise 12.4 percent over last year to 317 million pieces.
This means more distribution centers are opening doors in strategic locations through the U.S., including a new one that meets customer demand in heavily-populated northern Virginia.
The new facility is part of a nationwide network expansion, says Virginia Business, to boost daily package volume capacity and enhance the speed and service capabilities of the FedEx Ground network.
The biggest newsflash: An expanded network of distribution facilities – FedEx has opened 11 new hubs with advanced material-handling systems and expanded or relocated more than 500 local facilities since 2005 – now make it possible for FedEx to make one-day ground service deliveries to more than 70 percent of the U.S.
The company is also investing in automation and “minimizing the human touch,” says the Pittsburgh Post Gazette. Automation has been expanded at 31 FedEx hubs, utilizing technologies that move packages via conveyor belt through a six-sided “scanning tunnel,” tracking everything from package dimensions to weight. The system makes sorting decisions in about half a second, according to the Gazette, directing packages to appropriate destination in the hub, where they’re loaded into a van for delivery.
FedEx has come a long way since it first implemented the bar code system in 1985. The Wall Street Journal details FedEx’s “Orion,” the software algorithm that determines the most efficient route and schedule for delivery drivers who make 120+ stops each day. No more flipping through map books or repeating a daily route – Orion considers up to 200,000 of the best routes and schedules before selecting one and setting the driver on course.
What’s the value of shaving a minute here or a mile there? $50 million a year, says FedEx – that’s the savings of reducing by one mile the average aggregated daily travel of its drivers.
Kathryn Hamilton is Vice President for Marketing and Communications at NAIOP Corporate.