UPS vs. FDX ground rates

[wily_old_vet]

After reading the thread about definite time ad I decided to do some research. These rates are based on a daily UPS pickup, 5 lb pkg to zones 2 and zone 8 and they are residential.

zone 2 UPS 5.08 fdx 5.00
zone 8 UPS 7.35 fdx 7.24
Our rates included fuel surcharge I don't believe theirs did but can't be positive.

Additional services
signature required-UPS 2.00 fdx 2.00
date certain-UPS 0.00 fdx 3.00
evening delivery UPS n/a fdx 7.00
by appointment UPS n/a fdx 15.00

So if you want that date certain, evening, by appointment pkg from fdx it will cost you an additional 25.00. Funny they don't mention that in the commercial. If you don't want evening and appointment but do want date certain you will pay 3.00 more for fdx.

It would be nice if that fdx contract driver that's on the board sometime would let us know what they think about the evening delivery thing.

 

[traveler]

wily,

Thanks for the analysis. It sure answers some of the questions I had.

I don't think there are too many folks willing to part with $25.00 to get a date + evening + appointment delivery. I guess the guy "exfoliating" in the commercial had plenty of cash (extra skin) to spare.

 

[muncher]

The word is slowly getting out about Fed Ex Ground service.......IT SUCKS!!!
I have heard from alot of dissapointed customers about the poor service.

 

[rushfan]

In our center, we are a bit willing to flex with the customers. I'll get messages that a customer wants their package the same day that I made an attempt. I send a message to the center with info where the customer can meet me. Generally, the customer will meet me on route and get the pkg.
I don't see the big benefit for the friend-word company's new service.

muncher, I've heard the same.

(Message edited by rushfan on December 04, 2003)

 

[tieguy]

One thing to think about. As the technology behind PAS and Mr. Ed evolves I would imagine we will one day be able to store all types of information about customers such as their preferred delivery time, DR spots etc.

 

[wily_old_vet]

tieguy-Preferred delivery time? We have always told the customer that we can't arrange a time for delivery or otp. I thought one of the things PAS and EDD were supposed to do is to cut down miles travelled. If we start factoring in preferred times of delivery miles will go up not down.
Fdx announced their new rates today. Ground mirrors us (surprise, surprise) but they undercut us by .4% on express. Think maybe they were trying to slap us back for hurting them with the low increase on ground prices? Can't see .4% making a difference since large shippers already get a discount anyway.

 

[tieguy]

Agreed.
If the new offering by home does well I'm sure we will try to match the service or do one better. The technology we are currently developing will help make us much more efficent. As we do so I wouldn't be surprised to see us try to get fedex in a price war. Especially while they are heavily leveraged and trying to pay for their expansion.

 

[pgraening]

I think the primary reason express rates were lowered less than ours is because we've been stealing their priority/overnight volume and they want to get it back. It might catch a few people, but I doubt it will work. Why? For a 10:30 AM delivery, with a standard NDA, you have to pay over twice as much with FedEx for their "Priority Overnight 10:30." And even then, they are sneaky - our FedEx packages will suddenly become regular priority packages for no explainable reason, so then we don't see them until noon, or even later in the day. It just doesn't compare to the level that we offer, for a lot less. (I know it's hard on those drivers to get those NDA's out there on time sometimes, but it's worth it.)

I do see issues with ground but they just don't have the infrastructure yet. And while FedEx as a whole certainly covers the gamut of shipping services, they still haven't expanded into the secondary related services as we have, like UPS Capital and SCS.

I don't think we'd win a price war. But for FedEx to expand they're really going to have to find more money, somewhere. And the virtual walls they have between Ground/Home Delivery/Express are probably going to shoot them in the leg in the future, because to run operations for three different units providing basically the same services... madness.

Plus we have Basic. Rant and rave all you want, but Basic is probably going to stay. With Basic we can cherry-pick those packages that are not profitable and hand them over to the post office, saving us from losing too much money. That's why some odd packages that aren't "rural" have been delivered by USPS - it's just cheaper. And with the (hopefully) new business we will get by offering Basic, it will open the opportunity for those customers to use other services as well.

But I think we've got them beat with our technology, our history, and definitely our service.

 

[tomb]

I've been delivering basic packages to the post office this week, here is my "take" on them.

The other day, the postmaster told me that the stuff I had been delivering, had been delivered by SpeeDee delivery and that SpeeDee had picked it up from another trucking company. So the Basic service, added one stop to my route (1-8 pieces per day, so far) and took volume from SpeeDee and another trucking company. I see that as a win for UPS. The packages have come from Gevalia and a couple of clothing places that we have not been delivering, so I have not "lost" any residential stops, but gained a very easy business stop.

I think if you watch the return labels, you will find that the volume that is traveling the "basic route" is volume that we did not have, so it is all essentially new volume.

Seems like a positive to me.

Tom B

 

[pkgdriver]

I had 2 Basic stops last week. Gevalia Coffee amd a Lane Bryant company. They are companies i usually dont have. The service level code was(03)
so it must recoginze the basic service level from the shipper number. When box is scanned it brought up the procedures for basic pkgs. A NI disposition also brings up another screen.

 

[gman]

I get several of these "Basic" packages a day but never knew thats what they were til I read it here. Most if not all are Lane Bryant. And most of those seem to go to large apartment complexes. They say to leave them but I am not about to put a package at the outside common door of a secured building with 24 tenants. I also get packages from Omaha steak company that says to release them at any delivery location. Sounds like the beginning of a paper trail and a lot of driver follow ups and head aches for me!

 

[upsdude]

gman....................

We have been threatened with warning letters for bringing back any of the Basic Level packages.

 

[rdwarrior]

I had two Basic pkgs last week.I also had two stops for the same addresses on the pkgs. Seemed
kinda strange to deliver these two UPS stops then take their pkgs to post office !!