UPS is reducing service in rural areas scattered across the country in a push for increased efficiency.
Through the initiative, UPS shipments in certain ZIP codes will spend an additional day in transit, the company said in a statement. Delivery date guarantees still apply, and critical healthcare deliveries through UPS Premier are not affected.
"This affects less than one percent of our deliveries every day, so the vast majority of our customers will not experience any difference in the service they receive," UPS said. "We are constantly evaluating and modifying our network, and we remain committed to providing our customers with the most reliable and efficient service wherever they live and work."
The delivery giant did not specify which ZIP codes the change applies to, but local news reports indicate the initiative is focused on rural communities.
Areas impacted by the change this year have included the Key Peninsula area in Washington state, some smaller cities in Middle Georgia, a handful of towns in Piscataquis County, Maine, communities surrounding Mobridge, South Dakota, and rural West River communities in South Dakota.
A UPS spokesperson told the WTVM news station in Georgia that affected ZIP codes may change over time as the company determines the program's effectiveness.
Meeting time-in-transit expectations for remote deliveries has been a growing challenge for UPS amid the rise of e-commerce, said Anthony Robinson, founder and CEO of logistics intelligence platform ShipScience, in an email.
This shift has meant more residential deliveries, including for homes in rural areas that are costlier for carriers to serve compared to dense urban markets. UPS has been pushing to reduce costs in its delivery network this year in the face of soft demand and climbing labor expenses.
Since only a small portion of UPS deliveries are impacted overall, Robinson said shippers are unlikely to notice any day-to-day changes or material decline in their time-in-transit averages. However, he added that programs like the one UPS is rolling out tend to grow in scope.
"The fact that UPS rolled this program out with a fractional customer impact minimizes blowback," Robinson said. "But now that the program terms are set, it will be much easier for UPS to add additional [ZIP] codes into the 'remote' classification without raising flags or triggering additional press."
FedEx has also scaled back some rural services to improve its operating efficiencies. Last year, the UPS rival's Ground unit began reducing Sunday home delivery coverage in lower-population markets.
