Shipping & Fulfillment

UPS SurePost, FedEx SmartPost: Slow, but Less Expensive

Managing free or low-cost shipping can be one of the most confusing and difficult problems online retailers — particularly small ones — face, as customers want a superb and a free (or nearly free) shipping experience.

Part of the problem for ecommerce businesses is that there is no single solution to all shipping problems. There’s no panacea. Rather each business will need to find the array of shipping methods that suits its products and customers.

For some ecommerce operations, “last mile” services from UPS SurePost and FedEx SmartPost offer a good balance of price and speed of delivery. In fact, these services may work well for non-perishable subscription box retailers, custom product retailers, and similar online businesses.

How SurePost and SmartPost Work

Both FedEx SmartPost and UPS SurePost are meant to play to the carrier’s strengths and provide a relatively low-cost way to ship packages.

UPS and FedEx are both very effective at collecting, sorting, and moving packages from place to place. They are masters of shipping hubs and package sorting. But when it comes to delivering a single package to a single residential address, they are somewhat less efficient. It costs FedEx and UPS about the same amount of money to send a driver and truck to a business address to drop off 20 boxes as it does to send that same driver and truck to a residential subdivision to deliver one box.

Enter the United States Postal Service. The USPS visits nearly every residential address in the U.S., almost daily. Driving to a residence is just part of its job.

So UPS and FedEx work with the USPS. For SurePost and SmartPost, UPS and FedEx each pick up the shipment, process it, and — in one way or another — deliver the box to a USPS facility very near the final destination. Then the USPS carries that box on the final leg — i.e., the “last mile” — dropping it off when it delivers, say, the electric bill and the L.L. Bean catalog.

Several years ago, FedEx published a helpful illustration showing how SmartPost bypasses the USPS’s bulk sorting and sectional facilities, instead relying on FedEx for that portion of the shipping process.

This illustration from FedEx shows how SmartPost packages use FedEx for sorting and delivery near the final destination, while the USPS delivers the box.

This illustration from FedEx shows how SmartPost packages use FedEx for sorting and delivery near the final destination, while the USPS delivers the box.

Balance Price and Speed of Delivery

Because SurePost and SmartPost let UPS and FedEx focus on what they do best, while the USPS takes advantage of the fact that it is going to a given residential address anyway, the services tend to be significantly (as much 20 percent) less expensive than FedEx’s and UPS’s own home delivery services.

SmartPost and SurePost also avoid residential delivery fees, which are possible with other FedEx and UPS ground services; they can be delivered on Saturdays without an additional charge; and they can be sent to post office boxes or U.S. military addresses.

These last mile services, however, can take a bit longer to actually deliver a shipment. Both UPS and FedEx advertise that SurePost and SmartPost, respectively, will take between two days and seven days to be delivered. Some shippers report that this is about one to three days longer than if the package had been shipped via either carrier’s ground service.

Many things may contribute to the slower delivery, not the least of which is that the package most move from one carrier (UPS or FedEx) to another (USPS).

Online retailers will need to weigh, so to speak, the lower cost of sending a package against the slower speed of delivery. Both of these can impact the customer’s shopping and shipping experience.

Finding the Right Solutions for Your Products

Last mile services like SmartPost and SurePost may make more sense for some online retailers than it will for others. As an example, SurePost and SmartPost might work well for some subscription box sellers.

Imagine that your online store sells beard-related consumables via a subscription. Each month, you send your customers a supply of beard oil, beard balm, and similar products. Since you are simply replenishing your customer’s inventory of beard grooming items, you can ship well in advance. The relatively slow speed of delivery won’t impact your customer’s experience and your beard-care business can save on shipping. Your customers know, simply, that their beard box tends to arrive in the first week of the month and shipping is free. It doesn’t matter to them when you shipped it.

In a similar way, businesses that make custom products, which the customer expects to take time, may be able to use SmartPost and SurePost.

Imagine your business makes and sells custom prom dresses online. A young lady follows the directions on your site to measure her size. She dutifully enters these measurements when she orders her custom prom dress, selecting her favorite fabric and cut. Her expectation is that the custom dress will take some time to make. Your business, therefore, could use a service like SmartPost or SurePost without disappointing your customer because of the slow delivery.

Last mile services are not the solution to all ecommerce shipping problems. But for some businesses, some products, and some customers, SurePost and SmartPost offer a good balance of price and delivery speed.

Armando Roggio

Armando Roggio

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