JCPenney CEO: Postal Service Is Really Online Retailers’ Biggest Problem

Image courtesy of Mike Mozart

As bricks-and-mortar retailers attempt to attract more customers and make more sales, they are increasingly courting online shoppers. But all of those two-day shipping services and other free shipping guarantees are putting pressure on delivery companies, and that could be a big problem, according to the top executive at JCPenney. 

The Street reports that JCPenney CEO Marvin Ellison believes the biggest obstacle for e-commerce retailers will be actually getting products to customers.

Ellison, who spoke at a Piper Jaffray conference this week, doesn’t think that delivery services, specifically United States Postal Service, will be able to keep up with demand soon enough.

That’s because, Ellison said, the services aren’t “increasing capacity to deliver at the same rate e-commerce is growing.”

But given all the competition in the retail sector, JCPenney isn’t exactly helping things for USPS, UPS, or FedEx.

Ellison said during the conference that JCPenney recently released its own online shipping program that will send products from all of its stores to customers. This initiative will add to the 77% of online orders Ellison claims “touched” physical stores last year.

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