FedEx is so slammed with online orders that it's reportedly capping shipments from major retailers like Nordstrom and Hobby Lobby

FedEx is fielding an unusually high number of online orders.
The parcel giant is limiting how much retailers like Kohl's and Nordstrom can ship, according to a report from The Wall Street Journal .
It shows how much store closures from the coronavirus are shifting Americans to online orders, even of nonessential items, and how it's overwhelming delivery giants.
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If your order from Nordstrom, Kohl's, Bed Bath & Beyond, DSW, or Hobby Lobby is moving at an unexpectedly sluggish pace, FedEx may be the reason.

The Wall Street Journal reported on Thursday that FedEx is so overwhelmed with online orders that it's capping shipments from some two dozen retailers until at least May 19.The companies whose orders FedEx has capped include Belk, Abercrombie & Fitch, Kohl's, Bed Bath & Beyond, Eddie Bauer, Neiman Marcus, Nordstrom, Hobby Lobby, and DSW.

"These customers have seen significant volume growth since the spread of Covid-19," FedEx told Ground workers in a memo leaked to the Journal. "In a time of already high volume growth, capping the number of packages to be picked up at these locations will limit any negative impacts to the FedEx Ground network."

A FedEx spokeswoman said these limits are similar to what the company mandates around Christmas time, ensuring reliable service. The parcel giant has also increased Sunday delivery, and, in certain locations, hiring.

Americans are now buying (nonessential) stuff online

Earlier this year, Americans shifted to buying household goods, groceries, and essential supplies online. Onlinesales of hand sanitizer jumped by 228% in the US during the four weeks ending on March 7, compared to the same period last year, according to retail sales tracker Nielsen .

Adobe Analytics said a 100% increase in online grocery orders in mid March drove a 25% uptick in overall online orders , compared to a period earlier in the month.

But as the government-mandated shutdowns from the coronavirus have endured, people are starting to buy more and more of those less essential goods that retailers like Nordstrom or DSW might hawk.

"It went from people trying to stock up and maybe buying a little bit more than they needed to understanding that things are OK, I can move beyond the basics of food and shelter," Jaimee Minney, senior vice president of marketing and public relations at market-research firm Rakuten Intelligence, told CNBC .

Rakuten Intelligence found for the first half of April, compared to the first half of March, Americans bought nearly nine times as many books, nearly three times as many toys and games, and more than twice as many sports and outdoors items. Purchases of beauty products upticked by 38%.

Meanwhile, those who are seeing their states reopen may start to consider the ensembles they may need for garden parties or weddings, suggested a recent white paper from Pinterest .

The shift to online is whelming UPS, FedEx, and Amazon

Americans have shifted to ordering more online for years, but the coronavirus pandemic is accelerating that. Sales online popped by 49% in April, according to Adobe Analytics.

And while an unexpected deluge of packages may buoy delivery companies, the FedEx shipping cap shows it's also disruptive to normal business activities. UPS and Amazon have seen disruptions, too.

UPS said it delivered 19% more packages to homebound Americans in the first three months of 2020 compared to last year. But the increase in residential over commercial deliveries ended up eroding UPS' margins.

Meanwhile, Amazon was forced to halt all third-party package shipments last month , and had to ban warehouse deliveries of nonessential goods in March .

Many experts believe that increase will stick. As a result, parcel giants must now piece together how to deliver more boxes on doorsteps than ever before.

"The No. 1 thing that we have seen is an explosion in e-commerce due to the physical store closures," Brie Carere, FedEx chief marketing and communications officer, told eMarketer. "If we thought e-commerce was growing faster before, we're going to see even greater acceleration."

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