• on Nov 25th, 2013 in Pricing & Rates | 1 comment

    Imitation is the sincerest form of flattery, they say. Maybe so. It’s just not usually FedEx that is doing the imitating or the flattering. But with its new “simple and predictable” flat rate shipping option, FedEx seems to be trying to look like the U.S. Postal Service in one particular way.

    The FedEx One Rate bears more than passing resemblance to the popular Priority Mail Flat Rate, suggesting FedEx is shifting strategy to become more aggressive in the light-weight retail package segment it once largely ceded to the Postal Service.

    And yet, the products aren’t identical. For one thing, FedEx One Rate isn’t quite as simple as Priority Mail Flat Rate. Unlike Priority Mail Flat Rate, One Rate has weight limits: 10 lbs. for an envelope and 50 lbs. for a parcel. It also charges based on distance across three zones of travel. Your package is going through more than one zone? You’re paying more.

    Then again, FedEx One Rate comes with free packaging, like Priority Mail, and FedEx is waiving some – but not all – associated surcharges, like residential and fuel surcharges. Customers who find that surcharges add significantly to the shipping cost will likely smile.

    All in all, customers should be well-served by having another retail shipping option this holiday season. The National Retail Federation expects retail sales in November and December will rise 3.9 percent over last year to $602 million - $738 per shopper – and some of those purchases will certainly be gift-wrapped and put in a shipping box.

    While the FedEx product appears less simple, it could have other features that customers might prefer. A customer might find the hours at a nearby FedEx Kinko’s more convenient than the local Post Office. And, FedEx’s enduring image as a reliable shipper might make FedEx One Rate more appealing to some. Still, others might prefer the simplicity and certainty of the Priority Mail Flat Rate, with its one-price-goes-anywhere approach. Too early to tell.

    But maybe you can give us an idea:

    • What are your holiday shipping plans this year?
    • Do you plan to use one of these simplified packaging products?
    • Does convenience outweigh simplicity? Or vice versa?
    • What other retail package services would you like to see?