How UPS Stole Christmas (and E-Retailers Might Save It)

Updated from 12:11 p.m. EDT to include FedEx and Amazon comments and stock prices. 

NEW YORK (TheStreet) -- UPS (UPS) was feeling particularly Grinchy over Christmas, leaving many customers' trees bare.

Perhaps "stole" is too strong a word but in failing to deliver gifts by their promised arrival date, UPS left some customers without that usual warm and fuzzy holiday feeling. 

The Atlanta-based shipping company experienced an avalanche of online orders in the days leading up to Christmas, causing delays and sending customers to social media to vent. To a lesser extent, packages sent via FedEx (FDX) also experienced delays.

With e-commerce now such an integral part of Christmas shopping, it's becoming clear that delays in the old-world model of physical delivery is lagging behind the new-order demand for buy-now-get-now purchases. 

While UPS has yet to respond to requests for comment, a FedEx spokesperson said delays were isolated incidents and were being addressed.

"Our 300,000 team members delivered outstanding service during this holiday season and we experienced no major service disruptions in the week before Christmas despite heavy volume," said FedEx spokesperson Bonny Harrison. 

By early afternoon, Amazon had surged 1.1% to $403.56, UPS was trading 0.11% lower to $104.35, FedEx was up 0.75% to $143.06 and Kohl's had shed 0.13% to $55.75. 

As a result of delays, many e-retailers such as Amazon (AMZN) and brick-and-mortars such as Kohl's (KSS) and Wal-Mart (WMT) were unable to deliver on guarantees that orders placed would arrive before Christmas.

As compensation, Amazon has offered refunds on shipping charges and $20 gift cards to affected customers, while Kohl's said it would pay the cost of any goods that arrived late.

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