Atlanta – In a move that could sting UPS, Dell, the nation’s biggest computer maker, plans to ship many computers to U.S. post offices for customer pickup, rather than directly to buyers’ homes.
That will shift some shipments away from UPS, currently Dell’s primary deliverer for computers.
The computer maker is unsure how many computer shipments will ultimately be affected, Dell spokesman Andy North said Tuesday.
Dell is one of UPS’ biggest and most important customers. UPS declined to say how much revenue it gets from the computer maker, but it said the amount has been growing annually.
“We are comfortable with our working relationship with Dell currently and moving forward,” UPS spokeswoman Susan Rosenberg said Tuesday.
UPS will continue to handle computer shipments to businesses and some residential customers, North said. “We have had a long-standing relationship with UPS. That’s not going to change.”
The move highlights the competitive threat UPS and rival Fed Ex face from the U.S. Postal Service, which is vying to snatch up more of the nation’s package business. It also gives the Postal Service another way to compete for heavier packages such as computers. The Postal Service intends to expand beyond Dell with the new service, called Hold For Pickup, by offering it to other shippers.
Dell has provided free delivery of computers to customer homes via UPS, with fees tacked on for buyers who want rush deliveries.
Under the new plan, with the exception of higher-end computers, the free delivery will go only as far as some post offices, North said.
Dell said it expects to begin shipping its first computers to post offices as early as October.
Independent shipper APX Logistics, based in Santa Fe Springs, Calif., will transport the computers to about 5,000 of the nation’s 38,000 post offices. Postal workers will scan the packages, automatically notifying Dell so the computer maker can let customers know the packages are available for pickup.
North portrayed the change as one made in response to consumer concerns about the hassle of not being home when UPS tried to make deliveries. In those cases, UPS would leave a note, giving consumers the option of further delivery attempts or picking up the high-dollar package themselves at UPS terminals.
Under the new plan, customers won’t have as far to drive to make a pickup, North said. “Post offices are pretty much in every neighborhood and generally much closer than a UPS depot.” But Roger Kay, a market research analyst based in Wayland, Mass., said the shift to post offices would be less convenient for customers who are home to accept computer deliveries.
And Kay said he suspects the bottom line drove the decision.
“Dell is always trying to tighten down its shipping model in little ways,” he said. “This may be a situation where they say, ‘Let’s throttle back on shipping costs. If people want the extra service (of delivery to their doorsteps), they will pay for it.”‘
Dell spokesman North said the nation’s soaring fuel costs “really didn’t play a part” in the decision.
