Inside Logistics

Canada Post says delays will persist

Says it is operating warehouses that weren't designed for physical distancing


May 27, 2020
by Canadian Press and Inside Logistics Staff

OTTAWA – Canadians should anticipate parcel delays for the foreseeable future, Canada Post says.

The company says it is experiencing slowdowns as it attempts to operate distribution facilities “warehouses that were never designed to keep people two metres apart takes more time.”

As Canadians continue to ramp up and diversify their online shopping, Canada Post is responding to unprecedented parcel volumes while maintaining important physical distancing measures in its facilities.

Canada Post is delivering in record numbers and also handling a wider variety of items. With parcel deliveries growing at a record pace from April to May, Canada Post hit an all-time, one-day record on Tuesday, May 19 with 2.1 million parcels delivered. The company notes that is roughly three times the norm for this time of year.

It’s not just the volumes that are causing challenges, the number of larger household items, like mini-fridges, patio furniture and barbecues coming through our network have also increased. These bulky items often require a two-person lift which creates additional safety challenges and delays.

To keep up, Canada Post says it it processing and delivering on weekends and adding temporary employees. As well, some parcels may be transferred to other Canada Post locations for processing based on capacity.

Meanwhile, the company swung to a $66-million loss before taxes in the first quarter despite the surge in parcel volumes near the start of the Covid-19 lockdown.

The segment’s net loss from the period ended March 28, compared with a $23-million profit a year earlier.

Revenue increased two per cent to $1.68 billion with mail down 0.6 per cent to $729 million and parcels up 10.4 per cent to $666 million.

Canada Post noted that the parcels growth rate was higher than a year ago but lower than the first quarter of 2018.

Direct mail revenues fell 8.6 per cent to $230 million amid continued erosion from digital substitution as well as delays or cancellations of marketing campaigns due to Covid-19.

The cost of operations in the Canada Post segment increased by $93 million while the Canada Post Group of Companies posted a net loss of $39 million compared with a net profit of $29 million in the first quarter of 2019.