By Louis DeNicola, Cheapism.com
For many consumers, Santa's sleigh takes the form of a white or brown truck, and gifts arrive by way of the doorstep rather than the chimney. FedEx, UPS, and the U.S. Postal Service all promise to whisk a package shipped today across the country in time to go under a tree tomorrow. But can they do it without blowing your holiday budget? Cheapism obtained rate quotes for a variety of services from all three providers and, in every case, the Postal Service proved the cheapest option.Are you shipping packages for the holidays?
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Take, for example, a 5-pound package going to San Francisco from New York. In its search for cheap shipping, Cheapism found that overnight service would cost $85.07 (for delivery by 3 p.m.) or $91.76 (by 10:30 a.m.) with either FedEx or UPS and $52.20 at the Post Office, with guaranteed delivery by noon. If you print a shipping label at home and schedule a pickup through USPS.com, the rate is only $39.14.
Cheapism's full shipping comparison includes price quotes from each courier for 5- and 10-pound packages sent to Chicago and San Francisco from New York City (the site completed its research before Hurricane Sandy disrupted service from the East Coast). In general, UPS and FedEx offer more options for expedited shipping, with guaranteed delivery times, but charge much higher prices.
Media Mail from the Postal Service emerged as the absolute cheapest option overall, costing only $4.15 for a 5-pound package and $6.19 for a 10-pound package to either city. However, the service applies only to "educational materials" such as books and DVDs. For other items, the Postal Service's Parcel Post beat out UPS Ground and FedEx Home Delivery, although the estimated transit times were six days to Chicago and eight days to San Francisco, compared with guaranteed delivery in two days to Chicago and five days to San Francisco with UPS or FedEx.
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FedEx and UPS mirror each others' prices and services, quoting precisely the same rates, down to the cent, almost across the board. The sole exception is ground delivery, where FedEx Home Delivery maintains a slight lead over UPS Ground. In Cheapism's comparison, the price differences amounted to no more than a couple of dollars and change. It's worth looking at the transit times for these services before springing for an express option. UPS and FedEx quoted the same guaranteed delivery date for ground shipping to Chicago as they did for two-day services that cost more than twice as much.There are many options for shipping packages.
Cheapism saw substantial savings with flat-rate boxes from the Postal Service, which ship for the same price regardless of weight or destination, as long as the contents fit in one of several sizes the Postal Service provides. For instance, shipping a 10-pound package overnight to San Francisco costs $39.95 vs. $76.95 for regular Express Mail at the Post Office or $116.17 at FedEx or UPS. The heavier the package (up to 70 pounds), the greater the savings. Flat-rate shipping is often the cheapest method for expedited delivery, but not always. Be sure to price out both regular and flat-rate shipping at the Postal Service for Priority Mail, a two-to-three-day service, or overnight Express Mail, the only option with point-by-point tracking and a money-back-guaranteed delivery time.
All the FedEx and UPS services Cheapism researched include tracking and a money-back guarantee, although consumers may not be able to claim a refund if a late delivery can be blamed on a fine-print problem such as inclement weather or an incomplete shipping label -- or if a package is mailed too close to Christmas. FedEx is suspending its guarantee for Home Delivery beginning Dec. 11. The company will still guarantee pricier FedEx Express deliveries, which entitle the shipper to a refund if they arrive even one minute late. However, beginning Dec. 18, the guarantee will apply only if a package is delayed more than 90 minutes.
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Beyond Price. As perks such as money-back guarantees suggest, there is more to consider than just price when determining the best cheap shipping provider. Cheapism also considered factors including convenience, reliability, and customer satisfaction. The American Customer Satisfaction Index historically favors FedEx, which has outscored UPS by two points and the Postal Service by eight points on average over the past 15 years. In 2012, it bested the other two by only one point (earning 82 out of 100).
As for convenience, the Postal Service far outnumbers UPS and FedEx with more than 35,000 retail offices. However, the private companies compete by operating about 40,000 drop boxes apiece, accepting packages 24/7 at a time when the Postal Service has cut business hours at thousands of locations. All three couriers provide free pickup service for packages with print-at-home shipping labels. Only the Postal Service offers free Saturday delivery for all shipments. Saturday delivery costs an additional $15 with either UPS or FedEx, with the exception of FedEx Home Delivery. The schedule for that service is Tuesday through Saturday, instead of Monday through Friday.Not only did the USPS rank cheapest but also is the most convenient with more than 35,000 retail offices.
Specific on-time-delivery numbers proved difficult to nail down. Data compiled by shipment tracker PackageFox in 2011 show that 91 percent of UPS express packages arrived on time vs. 88 percent for FedEx. The Postal Service tracks its own Package Services category, which includes Media Mail and Parcel Post but not Express Mail or Priority Mail. The most recent quarterly performance results: 92.6 percent on-time delivery, up from 88.5 percent in the same quarter last year and notably higher than the 2011 rate of 76.7 percent overall. However, these packages must merely arrive by the end of the appointed day, whereas an express delivery might be delayed by a single minute and still be considered late. The only sure conclusion here is it's best to send out holiday gifts as soon as possible, regardless of the carrier.
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For more details, check out Cheapism's complete guide to cheap shipping, which includes a look at ecommerce and the various ways to secure free shipping online.
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