OVERNIGHT DELIVERY SERVICES

Overnight delivery services has increased the speed by which we do business. With FedEX, Airborne, UPS and the USPS Express mail, businesses are able to set and meet tighter deadlines, conduct business rapidly, and stay in touch over long distances. Although still a relatively recent innovation, overnight delivery is now ubiquitous, with businesses expecting delivery the next morning for anything of even slight importance.

TYPES OF SERVICES & RATES

POINTS TO CONSIDER

Types of Delivery Services

Over the past several years, the national overnight carriers have greatly expanded their menu of shipping options. Now, businesses can choose among as many as four different guaranteed delivery times when sending packages.

The fastest services promise delivery to major metropolitan areas by 8:00 or 8:30 A.M. These programs carry a hefty premium of $30 or more over other services and are primarily offered by UPS and Federal Express.

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Traditional morning delivery services promise delivery by 10:30 A.M. or 12:00 noon to most locations. These remain among the most popular overnight services, since they deliver packages in time for a thorough review and response.

Afternoon delivery services are designed for slightly less urgent packages. These programs promise delivery by 3:00 or 5:00 P.M., and cost a few dollars less than morning delivery.

Most overnight delivery services also offer options for two-day delivery. Two-day delivery tends to cost about 40% less than next-morning delivery, with delivery guaranteed by the afternoon of the second day.

Tracking Service

A few years ago, only Federal Express was capable of tracking packages while they were in transit. Now all companies have similar systems in place. The main difference is how rapidly each carrier can notify you of a package's status, with response times varying from half an hour to a full day depending on the carrier.

For the high-volume shippers who use tracking on a frequent basis, a more important consideration is the availability of computer tracking software. This allows you to access shipping information easily and quickly from a PC, so you spend less time on the phone or searching through reference books. Most firms offer software that is easy to install, with access to tracking computers via dial-up lines or the Internet.

Sending Strategies (for low-volume shippers)

If you ship fewer than 3 overnight packages per week, generous discounts will generally be unavailable to your firm. To get the best deal, you should use whichever carrier is best suited for each particular package. To do this, first open an account with each carrier and obtain rates for different weights and destinations. Then, before you ship, choose which carrier offers the best deal for that particular package.

Another way for small businesses to obtain lower rates is to work with a shipping consolidator. By combining shipping volumes from many firms, consolidators can negotiate lower rates. Although packages may be shipped via several different carriers, firms need only place one call to the consolidator for pickup.

High-Volume (shipping strategies)

For firms that send numerous overnight packages each week, the best way to save money is to find a carrier that best fits your needs and then negotiate customized discounts. To start, first estimate your monthly shipping volume. Be generous in your estimates, since rates can later be adjusted to reflect your actual traffic. Then approach carriers that best match your shipping patterns.

Airborne, Federal Express, and UPS specialize in letter-sized packages. UPS recently switched to a distance-based pricing structure, which may make it particularly attractive if you often ship to nearby locations. Burlington and Emery do not offer as competitive rates for letters, but are much more competitive for businesses sending large packages.

Regional Carriers

In addition to the major national carriers, there are a number of regional overnight carriers in the market. These companies specialize in the expedited delivery of packages within a defined geographic region.

Smaller shippers that have special shipping needs but find they are too small to warrant much attention from the national providers may want to consult a regional carrier. Regional carriers are often quite flexible in accommodating specific needs and concerns.

Generally, a company should be shipping about five packages a week to consider working with a regional carrier. Pricing from these carriers at such shipping volumes can be quite competitive with the larger players.

Special Notes

Until recently, only the Postal Service's Express Mail has a standard program that delivers on Sundays and Holidays. Since March, 1998, FEDEX started offering Sunday deliveries, at a premium.

Emery uses a different pricing system than other companies. Prices are quoted for each package based on the firm's current traffic and shipping loads.

When sending a package, make sure to ask when in the day the recipient needs to receive it. Next afternoon delivery is significantly less expensive than morning delivery.

Some carriers offer heavily discounted overnight shipping envelopes to companies willing to pre-pay for shipping.

Check when packages arrive. You may not have to pay for packages that arrive after their guaranteed time. While some carriers will refund the full price of a shipment that does not meet its deadline, others will only discount the cost to reflect the level of service that was provided.