The cost of overnight shipping is considerably more expensive than standard shipping. However, it’s an excellent option to offer in your online store because some customers are willing to pay for expediency. That’s especially true if your customers need their order by the next day. People in a time crunch will be willing to pay extra for overnight shipping, so you can pass that cost along to the end customer. Here’s what you need to know about overnight shipping services and why they may help your eCommerce efforts.
Editor’s Note: Red Stag Fulfillment originally published this post on Feb. 25, 2020. We updated it on June 23, 2022, to reflect pricing, overnight shipping promises, carrier capabilities, and a deeper understanding of ongoing global supply chain concerns.
When does overnight shipping arrive?
Each carrier offers different overnight shipping services, with different arrival times and pricing. There are pros and cons to each carrier approach, depending on what kind of overnight service you need. It’s good to remember that overnight shipping also can be called one-day shipping, but it is different from same-day shipping.
FedEx has three levels of overnight services and the difference between these services is the guaranteed arrival time. FedEx First Overnight, which arrives by 9:30 a.m. in most places, is substantially more expensive than the other services. Meanwhile, FedEx Priority Overnight option is slightly less expensive and offers next-business-day deliveries by 10:30 a.m. to businesses and 4:30 p.m. to residences. The third, FedEx Standard Overnight, is the most affordable option and will get your package to a business by 4:30 p.m. or a residence by 8:00 p.m.
Note that FedEx’s overnight shipping options focus primarily on weekdays. For example, let’s imagine you use FedEx First Overnight or FedEx Priority Overnight. Then, your package can be picked up or delivered on a Saturday in many areas, but this comes with an additional charge. Standard Overnight packages can be picked up, but not delivered, on Saturday for an additional charge, as well. FedEx overnight shipping options don’t deliver on Sundays.
How much does FedEx overnight shipping cost?
There are a few flat rate overnight options available. However, FedEx bases most overnight shipping costs on the weight of the package and the shipping zones traveled. Luckily for businesses, FedEx has done a lot of the work with their FedEx cost calculator.
FedEx’s standard overnight service typically is its cheapest, but that service unfortunately isn’t available in all ZIP codes. You must pay the higher price for FedEx Priority Overnight for more rural deliveries.
Overnight shipping can be costly. For example, let’s look at the cost to ship a 5-pound package from Knoxville, TN, overnight to a residence in Pittsburgh, PA. We’re using this FedEx cost calculator with a shipping date of Tuesday, June 28th, 2021.
FedEx First Overnight with an 8:00 a.m. delivery on Tuesday would be $157.07, while the Priority Overnight with a 10:30 a.m. delivery time on Tuesday is $118.78. If we were willing to wait a little longer for the delivery, costs would drop significantly to $47.31 for a Thursday morning FedEx 2Day AM® delivery, $41.26 for a Thursday afternoon FedEx 2Day® delivery, and $37.56 for a Friday afternoon delivery.
Unless you’re shipping very high-value products, these costs are prohibitive. Fortunately, there are effective ways to get your products to your customers quickly without paying for overnight shipping.
UPS offers a ground option with time-definite next-day shipping. This service allows you to choose the package’s arrival time: morning, noon, or end-of-day. It all depends on your needs.
Additionally, UPS provides two “fast” shipping options for someone who isn’t on an overnight shipping time crunch: fast and faster. The “fast” option is UPS Ground. UPS Ground is cost-effective and will have your packages arriving within one to five business days. The “faster” option is UPS 2nd Day Air® and UPS 3 Day Select®. These two options will have your packages arriving within two to three business days.
You can create an account through the UPS website to learn costs and the next steps in the shipping process for your UPS orders.
If time is not on your side, UPS does offer UPS Express Critical® which is their new same-day delivery service. However, you will need to contact UPS directly to be able to utilize this service.
The US Postal Service has only one overnight delivery option, USPS Priority Mail Express, with delivery service by 6 p.m. However, the Post Office does have a flat rate shipping option for overnight envelopes and boxes. That’s a service the other carriers don’t offer. USPS also notes that this service delivers seven days a week, extending its capabilities.
The Postal Service has struggled with some delivery capabilities in recent years. However, the Priority Mail Express service still offers a money-back guarantee on delivery speed.
How much does USPS overnight shipping cost?
USPS is one of the more cost-efficient overnight shipping options. For USPS Priority Mail Express, rates start at $23.50 for Commercial Base and Plus and $26.95 at the Post Office. Standard Priority Mail rates start at $7.37 for Commercial Base and Plus and $8.70 at the Post Office.
|FedEx First Overnight||9:30 a.m.||$$$$|
|FedEx Priority Overnight||10:30 a.m. or 4:30 p.m.||$$$|
|FedEx Standard Overnight||4:30 p.m. or 8p.m.||$$|
|UPS Next Day Air Early||8:00 a.m.||$$$$|
|UPS Next Day Air||10:00 a.m.||$$$|
|UPS Next Day Air Saver||3:00 p.m.||$$|
|USPS Priority Mail Express||6 p.m.||$|
The Amazon standard
Amazon has led the game in expedited shipping. The ability to have your orders shipped within one day or even the same day has put a lot of pressure on other carriers, but it takes several steps to get there for any business selling on Amazon.
First, businesses have to be established on Amazon for at least 90 days. From there, eCommerce businesses have to have a 95% on-time delivery rate and a 99% on-time shipping rate with one-day delivery orders. And the list doesn’t just stop there — Amazon also takes into account on-time delivery scores, valid tracking rates, and cancellation rates.
So, it might sound like a plan to switch to selling your products on Amazon and expect one-day or even same-day delivery, but it takes work for eCommerce businesses to reach that level. Luckily, there is a way to offer overnight shipping without having to run your business through Amazon.
How to offer overnight shipping
Customers like to have an overnight delivery option. They may not always opt to use it, but knowing that speed is available adds value for many buyers. However, you can only offer the option of overnight shipping to your customers if you can send orders quickly. Same-day fulfillment is a necessary order fulfillment service to enable overnight shipping. If an order misses a cutoff time, you’ve lost your chance to get it there overnight.
That can seem like a challenge, but overnight and expedited shipping options don’t have to eat into your bottom line. Customers who are in a hurry are often willing to pay a premium. In addition, the high cost of overnight options can make your standard shipping charges seem like a bargain if they decide they can wait.
Best ways to save on overnight shipping
With Amazon creating the industry standard with Prime’s two-day shipping, customers tend to judge every eCommerce company based on how fast they receive their products. Now Amazon offers one-day and even same-day delivery on certain items. To avoid being left in the dust, your eCommerce business needs to deliver orders quickly.
And don’t be fooled by current supply chain concerns. While many people may express frustration that Amazon and its Prime delivery options take more than two days, they still have that expectation. That means customers still expect you to try to offer speed and efficiency. So, if you need to get orders delivered overnight, you’ll need to find ways to save on overnight shipping. Here are four strategies to expedite your shipping while reducing your costs.
If you send many overnight orders, you may be able to negotiate lower rates with one or more of the major carriers. Even with negotiated rates, however, overnight shipping will still be pricey. The following two strategies are more cost-effective ways to deliver your products to your customers quickly.
Ship from multiple warehouses
Amazon can offer same-day delivery because it has many, many warehouses. The distance from an Amazon warehouse to your house is probably short, especially if you live in a large city.
Most eCommerce businesses can’t emulate the Amazon model, even if they use Fulfillment by Amazon. However, even small eCommerce businesses can take advantage of faster delivery time by storing stock in more than one warehouse.
And the bonus is that you don’t have to tie up a lot of money in extra stock to take advantage of this strategy. Red Stag Fulfillment’s two warehouses can ship to 96% of U.S. addresses in two days or less.
There is a cost to split your inventory among multiple warehouses. You’ll have to pay freight costs to ship in bulk to each location, but freight shipping is cheaper than shipping individual orders. Reducing travel distance for customer orders may ultimately lower costs compared to using a single warehouse.
In addition, faster delivery times incentivize customers to buy from you. When you consider your eCommerce fulfillment options, factor in the convenience and cost savings of shipping from multiple warehouses. Someone who decides not to spend on overnight shipping may be pleased that you can also get their order delivered within three or four days.
Ship from centrally-located warehouses
Using multiple warehouses is only helpful if those warehouses are in the right locations. Many eCommerce businesses use fulfillment centers near the port through which their products enter the States. However, shipping from a port city to customers across the country is slow and expensive.
California doesn’t always make sense for your fulfillment needs. That may seem counterintuitive, but, here’s why you may want to choose another location.
Red Stag Fulfillment put its warehouses in Knoxville, TN, and Salt Lake City, UT. Packages from these two locations can reach a substantial portion of the U.S. without traveling through many shipping zones. This means you can ship more cheaply and more quickly. If you want to offer free shipping, having multiple warehouses in central locations is necessary.
Ask for same-day order processing guarantees
Same-day order processing is essential for overnight delivery. If your fulfillment company can’t get your orders out the door the same day they are placed, you can’t ship overnight.
Carrier delivery times are only one factor in keeping customers happy. If your orders get stuck in the warehouse, you won’t be able to meet expectations for fast delivery. Make sure the fulfillment company you choose has a same-day order processing guarantee.
This order processing timing is important. That same-day guarantee is designed to process orders according to your service-level agreement. Red Stag gives you options for this order processing guarantee.
Please note that order processing and delivery are two different fulfillment elements, whether you ship with another 3PL or us. Order processing happens by the 3PL, while delivery is from the carrier. You need both to happen quickly to meet customer needs. Paying for overnight delivery doesn’t help much if it takes your 3PL four days to process the order.
Having same-day order processing enhances your ability to offer faster shipping. These order processing guarantees are the foundation you need to get goods delivered quickly, whether you offer overnight or standard shipping options.
Where does overnight shipping fit into your fulfillment strategy?
Overnight shipping can be a desirable add-on service to offer your customers. It can be a lifesaver when resolving a customer service problem. However, most eCommerce customers don’t want to pay the extra cost of sending an order overnight.
Choose multiple warehouses in central locations. That way, you’ll be able to deliver orders to your customers in one or two days. You can offer free or cheap shipping to keep customers happy. And you’ll be able to keep your fulfillment costs under control.