FedEx Ground Economy, Formerly FedEx SmartPost, Guide for Business Owners

In 2021 FedEx changed the name of FedEx SmartPost to FedEx Ground Economy. The services provided and information in this article have remained the same

Shipping costs have become an essential, often difficult to navigate, component of business for eCommerce brands to manage. Up against the brand power of giants like Amazon and other big box stores, over-priced (in the minds of the consumer) shipping can be a deal breaker. To be competitive in the digital landscape, you simply must offer low shipping costs. To do this, you need to find creative and competitive ways to reduce your own cost to ship, so you have the capacity to pass those savings on to consumers.

What is FedEx SmartPost?

FedEx’s SmartPost targets what’s known as the “last mile delivery,” the same way UPS does with its version, SurePost.

The actual delivery  segment of shipping (handing the package to the customer) is by far the most expensive – some estimates figure it can account for up to 28 percent of the total shipping cost. So by handling the entire shipment up to that last leg, and then passing that final portion off to the USPS, you are able to drastically reduce shipping costs as a result of lower FedEx SmartPost rates, savings which can then be extended to customers.

FedEx SmartPost offers residential shipping for relatively low-weight packages on Monday through Saturday deliveries. Shipments must be under 70 pounds, and they can’t be any larger than 130 inches long. Statistically, most SmartPost shipments weigh less than 10 pounds. Delivery time is generally anywhere between 2 and 7 business days.

Business owners find FedEx’s SmartPost shipping option both efficient and cost effective, with a potential 20 percent savings when compared against the traditional Home Delivery service. As noted, savings stem from eliminating that costly “last mile” portion of the delivery, particularly the elimination of the residential surcharge that shipping companies often charge to offset last mile expenses.

FedEx SmartPost Pros

FedEx SmartPost can be hugely beneficial for any brand that incurs shipping costs. There are pros and cons to this shipping option, but many times, the benefits outweigh any drawbacks. That said, it’s important to understand both sides so you can be sure you’re actually saving money if you decide to go the SmartPost route.

  • Shipping cost reduced – FedEx SmartPost shipping costs are less than other ground service costs. This is possible by delivering to USPS and allowing them to finish the delivery to the customer’s door. In doing this, the cost to ship is greatly reduced.
  • No residential surcharge – In other forms of shipping, to combat the most expensive leg of shipping (that actual delivery to the door), FedEx charges a residential surcharge. SmartPost shipping eliminates that fee, resulting in more savings that can be rolled down to customers.
  • Normal, familiar FedEx pickup – Enjoy the same, convenient, familiar way you’ve always shipped. The beginning of the process is the same as it’s always been. No need to make a special trip to the post office for these shipments.
  • Delivery to all USPS addresses – Regular FedEx shipments do not accommodate deliveries to a post office box. However, since the packages are in the hands of the post office at the end, SmartPost deliveries can go anywhere the USPS delivers, include P.O. boxes.
  • Saturday delivery – SmartPost offers Saturday delivery options at no additional charge.
  • Convenient software integration – SmartPost services are integrated into many shipping softwares.
  • One tracking number for either end of shipment – Despite having two shipping methods, conveniently track packages using just one tracking number.

SmartPost Cons

As with most things, there are some drawbacks to SmartPost. Knowing the disadvantages in advance can save you time, money and headaches when choosing the shipping option that makes the most sense for your needs.

  • Slower delivery time – Delivery time can be a bit longer when using SmartPost versus traditional ground delivery.
  • Need your own boxes – You can’t take advantage of the free boxes USPS provides.
  • Higher shipping fees outside the lower 48 states – Higher fees to ship to Hawaii and Alaska endpoints may reduce the cost-effectiveness of using SmartPost.
  • Tracking codes can be confusing – While we also note this as a pro, it’s important to acknowledge that the tracking codes can potentially be confusing for some customers, who may search their tracking code and see a package marked as “delivered” and then “out for delivery” again. If they don’t understand that SmartPost packages are first delivered to the USPS and then to them, this can be an unclear portion of the journey.  

FedEx SmartPost Delivery Time

FedEx SmartPost time to deliver can be 2-5 days longer than ground or home delivery. This is due to the additional shipper involvement once USPS takes over that last leg. Count on a guaranteed additional day just for that reason. But other factors can affect how long delivery will take, too. Such as, FedEx will wait until it has enough volume to make a delivery worth it, and then will do one delivery of multiple packages to the post office.

It’s important to consider that even with the additional days added on to delivery time, the tradeoff in savings may be worth it if deliveries aren’t time-sensitive and customers understand what to expect at the time of ordering.

Home Delivery vs. FedEx SmartPost

The major difference between FedEx Home Delivery versus their SmartPost option is simply who carries a package to the door at the point of delivery. When packages are shipped via Home Delivery, FedEx is in control of the shipment from the original pick up to the final hand off of the package. SmartPost deliveries, as we’ve discussed, are actually delivered to the customer by the USPS in an arranged partnership between FedEx and the United States Postal Office.

Benefits of Home Delivery

There are pros and cons to either type of delivery. Some of the benefits of shipping Home Delivery rather than SmartPost include:

  • Convenient alternate delivery location options – Customers can easily arrange for a package to be held at a FedEx location, even if the package is already en route.  
  • Free Saturday delivery – Like SmartPost, there is no Saturday delivery surcharge when shipping via Home Delivery.
  • Faster delivery – Home Delivery is guaranteed to be quicker than when shipped SmartPost.

UPS SurePost vs. FedEx SmartPost

UPS SurePost version of SmartPost. Both use the same model for last mile delivery via USPS. Both are cheaper options than each of the carrier’s ground deliveries. And both offer no-cost Saturday delivery. The biggest difference between the two is FedEx will drop SmartPost packages to the nearest USPS regional hub, which may be in a major city, whereas UPS will deliver their SurePost packages to the post office closest to the recipient’s address.

Benefits of UPS SurePost

There are some benefits to using UPS’s SurePost. Many of them are similar to the pros of FedEx’s SmartPost.

  • Reduction in cost – Like SmartPost, SurePost offers significantly reduced shipping rates that can be passed on to customers.
  • Delivery to any US address, including P.O. Boxes – This is a major plus for shipments going to P.O. Boxes. UPS won’t normally deliver to post office boxes, so this shipping option can offer flexibility and accommodate customers wishing to have deliveries made to P.O. Boxes.
  • Easy drop off – Mix in deliveries with all normal packages; no need to make a special trip to the post office or separate out packages by delivery-type.

UPS Mail Innovations vs. FedEx SmartPost

UPS has yet another shipping option in addition to their SurePost alternative. This is Mail Innovations and the main difference between it and FedEx SmartPost is in the types of packages each process.

Benefits of UPS Mail Innovations

While quite similar to other shipping methods, Mail Innovations has some distinct benefits.

  • Best for lightweight packages
  • Specializes in global mail products like BPM, flats and Media Mail
  • Uses a USPS tracking number

DHL eCommerce vs. FedEx SmartPost

Like SmartPost and others we’ve discussed, DHL eCommerce combines efforts with the USPS to offer cheaper shipping alternatives. However, this option is intended only for high-volume shippers, both domestically and internationally.

Benefits of DHL eCommerce

  • Returns included on international shipments
  • Affordable shipping even cross-borders
  • Large network of drop-off and return locations
  • Cash on delivery and e-wallet payment options

Ready to learn more about how ShipCalm can help you ship your products quickly, efficiently and cost effectively? We’re your shipping partner and are ready to help you with every step of the shipping way! Reach out today to learn more about how we’ve helped thousands of brands just like you!