Dive Brief:
- Best Buy has tapped FedEx as its primary national parcel carrier to help enable a "smarter" supply chain for the electronics retailer, CEO Corie Barry said in an Aug. 28 earnings call.
- Barry highlighted FedEx's Sunday delivery capabilities as an advantage, allowing the electronics retailer to get products to customers faster. Best Buy also expects an improved customer experience and lower costs due to "increased integration" with the carrier.
- "For example, just last week, we added FedEx real-time tracking data into customer order communications across all our FedEx orders," Barry said. "This will provide customers with more timely and accurate updates and should reduce support calls, cancellations and reship costs."
Dive Insight:
FedEx is now designated as Best Buy's main option for last-mile delivery, although Barry did not elaborate on how many parcels will ship via FedEx versus other carriers.
Outside of FedEx, Best Buy also sprinkles in the Postal Service, OnTrac, Shipt, DoorDash and Roadie in select areas, per its website. The retailer's listed delivery mix previously didn’t specify a primary carrier and included UPS, although sellers on the company's recently launched marketplace may use UPS themselves.
FedEx has often touted its Sunday home delivery coverage as an edge in gaining business over rival UPS, which doesn't offer such a capability. In March, FedEx EVP and Chief Customer Officer Brie Carere said the carrier expanded its Sunday offering to nearly two-thirds of the U.S. population due to demand from top customers.
“We have already received incremental commitments of more than half a million packages per week from existing customers tied to our Sunday delivery capabilities,” Carere said at the time.
Beyond pushing for faster shipping via Sunday delivery, Best Buy has also strengthened its fulfillment capabilities to boost the customer experience.
The company is now implementing a "data-driven sourcing solution" to choose the most efficient location to fulfill online orders from, Barry said. Best Buy processed 40% of all units shipped to homes through the new model for the quarter that ended Aug. 2, which generated cost savings and improved on-time delivery performance, the CEO added.
"We are targeting at least 70% of all orders to go through this new model prior to holiday with 100% implementation in early 2026," Barry said.
