FedEx Expands Sunday Delivery: A Strategic Move with Big Implications for Supply Chains

FedEx is doubling down on Sunday home delivery, a move that signals shifting dynamics in the parcel industry and underscores the growing demands of e-commerce. In its Q3 earnings call on March 20, 2025, EVP and Chief Customer Officer Brie Carere announced that the carrier has expanded its Sunday delivery reach to nearly two-thirds of the U.S. population—up from 50% previously—driven by demand from its largest customers. At Gain Consulting, we’ve analyzed this development to uncover what it means for supply chains, how it positions FedEx against competitors like UPS, and the opportunities it creates for businesses navigating the last-mile landscape.

Sunday Delivery: A Rebound with Purpose

FedEx’s latest expansion isn’t its first foray into Sunday delivery. At its peak, the carrier offered coverage to nearly 95% of the U.S. population, only to scale back in 2022 and further reduce scope in 2023, limiting services to densely populated areas with proven demand. The retreat followed struggles to make Sunday operations profitable, with one major delivery contractor calling it “both an incredible struggle and a financial disaster.” But this time, FedEx is approaching the rollout with a sharper focus—and tangible commitments.

“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 during the earnings call. Now covering roughly 66% of the U.S., FedEx’s Home Delivery and SameDay services are poised to handle this surge without adding capacity. “This change is enabling us to better utilize our existing assets while meeting the needs of our customers,” Carere added, projecting the expansion to be profit-accretive by Q1 of fiscal year 2026 (starting June 2025).

The timing aligns with a robust 11% year-over-year growth in FedEx’s U.S. ground home delivery and economy services in Q3, reflecting heightened demand from e-commerce giants and retailers pushing for faster, more flexible shipping options.

Why Sunday Matters—and Why It’s Tricky

Sunday delivery isn’t new, but its viability has long divided industry experts. On one hand, it unlocks faster shipping windows, catering to consumers who expect near-instant gratification. On the other, profitability hinges on volume—carriers need enough packages to fill trucks and justify the added day’s labor and fuel costs. FedEx’s past challenges highlight this tension: without sufficient density, Sunday routes can bleed money.

This expansion, however, seems better calibrated. By targeting nearly two-thirds of the population—likely urban and suburban hubs with concentrated demand—FedEx is optimizing its existing network rather than overextending. The half-million-package commitment from customers provides the critical mass needed to make Sundays work, turning a potential liability into a competitive edge.

FedEx vs. the Competition

FedEx isn’t shy about touting Sunday delivery as a differentiator, especially against rival UPS. While FedEx ramps up, UPS has no Sunday coverage listed on its website, having ended its SurePost partnership with the U.S. Postal Service in 2024 over service and pricing disputes. That decision has left UPS leaning on its Monday-to-Saturday network, potentially ceding ground to FedEx in the race for weekend delivery dominance.

Meanwhile, smaller player OnTrac has jumped into the fray, launching seven-day delivery across 75% of its network in 2024 to capture market share in the crowded parcel space. But FedEx’s scale—its vast ground network, integrated air operations, and now-expanded Sunday reach—gives it a unique advantage. For shippers, this creates a clear choice: FedEx’s seven-day flexibility versus UPS’s six-day reliability.

What’s Driving the Shift?

The resurgence of Sunday delivery reflects broader trends in e-commerce and consumer behavior. Online shopping volumes continue to climb, with Q3 data showing FedEx’s ground services thriving. Major retailers—think Walmart, Target, and Amazon—are pressuring carriers for faster turnarounds to compete with Amazon’s same-day and next-day benchmarks. Sunday delivery shortens the gap between order and doorstep, especially for weekend purchases, aligning with the “I want it now” mindset of today’s consumers.

FedEx’s ability to secure 500,000+ weekly packages suggests its biggest clients—likely e-commerce powerhouses—are betting on this capability to boost customer satisfaction and retention. For these shippers, Sunday isn’t just a perk; it’s a strategic lever to stay ahead in a hyper-competitive market.

Implications for Supply Chains

At Gain Consulting, we see FedEx’s expansion as a pivotal moment for supply chain leaders. Here’s what it means for your business:

1. Faster Last-Mile Options

   With Sunday delivery reaching two-thirds of the U.S., shippers can shrink delivery windows and meet rising consumer expectations. This is a game-changer for retailers aiming to match Amazon’s speed without building their own logistics empires.

2. Capacity Optimization

   FedEx’s focus on leveraging existing assets—rather than adding trucks or hubs—offers a model for efficiency. Shippers can piggyback on this approach, consolidating volumes with FedEx to maximize cost-effectiveness.

3. Competitive Pressure

   UPS’s lack of Sunday service and OnTrac’s regional push create a fragmented competitive landscape. Businesses must weigh carrier options carefully—FedEx’s seven-day reach could tip the scales for time-sensitive freight.

4. Profitability Potential

   FedEx’s confidence in Q1 2026 profitability suggests Sunday delivery is finally finding its footing. For shippers, partnering early could lock in favorable rates before demand drives costs higher.

   
   

Challenges to Watch

Sunday delivery isn’t without risks. Scaling too fast could strain FedEx’s network, echoing past struggles if volume commitments falter. Labor availability—finding drivers willing to work Sundays—remains a wildcard, especially in a tight market. And while FedEx expects profits, any misstep in execution could shift costs to shippers, as seen in earlier rollbacks.

How Gain Consulting Can Help

FedEx’s Sunday expansion opens doors, but seizing the opportunity requires strategy. At Gain Consulting, we’re equipped to guide you through:

• Network Analysis: We’ll assess your shipping profile to determine if Sunday delivery aligns with your customer base and volume patterns.

• Carrier Optimization: Our team can negotiate with FedEx—or diversify across UPS and OnTrac—to secure the best mix of speed, cost, and reliability.

• Last-Mile Efficiency: From routing to consolidation, we’ll streamline your operations to capitalize on FedEx’s expanded reach without breaking the bank.

• Future-Proofing: As e-commerce evolves, we’ll build a flexible supply chain that adapts to carrier innovations and consumer demands.

  
  

The Road Ahead

FedEx’s Sunday delivery push is more than a logistics tweak—it’s a bold bid to redefine parcel delivery in an e-commerce-driven world. With two-thirds of the U.S. now in reach and half a million packages committed weekly, the carrier is betting on volume to turn a former pain point into a profit center. For supply chains, it’s a chance to rethink last-mile strategies and gain a competitive edge.

Ready to leverage this shift? Contact Gain Consulting today. Let’s craft a plan that harnesses FedEx’s Sunday advantage—and positions your business to thrive in the fast-evolving landscape of 2025.