According to Arvato, 53% of shoppers consider shipping speed to be the most important factor when it comes to ecommerce fulfillment. The same study found that 24% of shoppers have canceled an order because of slow delivery speeds.
Thanks to Amazon Prime, online shoppers have come to expect 2-day delivery options wherever and whenever they shop online. When 2-day shipping is the norm, how can ecommerce brands stand out?
Enter overnight shipping, a delivery option that offers a premium experience to your customers — so you can exceed their expectations (and help last-minute shoppers).
What is overnight shipping?
Overnight shipping is a delivery option that guarantees customers will receive their order on the next business day.
This is often synonymous with next-day delivery or one-day shipping; however, exact delivery dates depend on when the order is placed. Shipping carriers have daily cutoff times after which next-day delivery cannot be guaranteed, and, depending on the carrier and shipping service, orders placed over the weekend may need an extra business day to arrive.
How much does it cost to overnight a package?
The short answer? It depends.
Overnight shipping costs can change due to a number of factors, including the following:
1. Package dimensions
All major carriers use a pricing model called dimensional weight (aka DIM weight) to calculate shipping costs. DIM weight takes a package’s dimensions into account to determine the shipping cost.
The dimensional weight is calculated by multiplying the length, width, and height of a package, then dividing that number by a DIM divisor. Shipping carriers base shipping rates on whichever is greater: the actual weight of the package or its DIM weight. That becomes the billable weight that determines your overnight shipping cost.
2. Package weight
Heavier packages cost more to ship than lighter shipments. As mentioned above, if the actual weight of a package is greater than the DIM weight, it’ll be used to calculate shipping costs. The heavier and larger the package, the more expensive it will be to ship.
3. Shipping zone
Shipping zones measure the distance between a package’s point of origin and its destination.
Carriers use shipping zones to calculate shipping costs. In the US, these can range from Zone 1 to Zone 8.
Shipping zones are calculated based on where an order is shipped from. This means that two different points of origin with the same destination could be shipping to completely different zones.
The higher the shipping zone, the more expensive a package will be to ship. When it comes to overnight delivery, next-day shipping, and other expedited shipping options, the price increase between zones gets exponentially higher.
4. Shipping agreements with carriers
You may be eligible to receive discounted shipping rates from carriers. Some carriers offer discounts for small businesses, while others discount rates based on high shipping volumes. When choosing which carrier(s) — or third-party providers — to work with, look into which rate discounts might be available to you.
Next-day shipping services compared
Next-day shipping is often expensive, but pricing can vary between carriers. Here are the overnight delivery options available from three major carriers.
USPS overnight shipping
USPS’s overnight offering is Priority Mail Express, their “fastest domestic service.” Packages under 70 pounds ship overnight through Priority Mail Express starting at $24.70. If you (or your customers) are really in a rush, there are also Priority Mail Express options that guarantee delivery by 10:30 am the next day.
Among the three major carriers, USPS offers the cheapest overnight shipping option. That’s because USPS runs local routes daily, so they don’t have to go out of their way to deliver to your end customer.
UPS overnight shipping
UPS offers three different overnight delivery options within the US, boasting “more overnight, on-time, guaranteed deliveries in the US than anyone.” These options include (from most to least expensive):
- UPS Next Day Air Early: Guaranteed overnight delivery as early as 8:00 am the next business day.
- UPS Next Day Air: Guaranteed overnight delivery typically by 10:30 am the next business day.
- UPS Next Day Air Saver: Guaranteed overnight delivery typically by 3:00 pm the next business day.
All overnight delivery options from UPS offer online tracking.
FedEx overnight shipping
Often the most expensive of the three carriers, FedEx also offers three US overnight delivery options in the US (from most to least expensive):
- FedEx First Overnight: The fastest option. Delivery as early as 8:00 am the next business day for most US destinations. Delivery by 2:00 pm to additional extended destinations.
- FedEx Priority Overnight: Delivery by 10:30 am on the next business day to most US destinations, with remote area delivery by 5:00 pm.
- FedEx Standard Overnight: Delivery by 3:00 pm to most US addresses.
All FedEx overnight options allow shippers to customize delivery and pickup options, including requiring proof of delivery.
How to offer overnight shipping to your customers
Working with a third-party logistics (3PL) provider can help you offer overnight shipping on your ecommerce store. ShipBob is a 3PL that allows online sellers to offer a variety of delivery options to their customers, including ground shipping, 2-day shipping, overnight shipping, and same-day delivery.
Because ShipBob works with different shipping carriers, delivery times are based on when the carrier scans in a package after picking packages up from a ShipBob fulfillment center. This can be later that same day or the next business day, depending on the carrier and time of day.
Distance makes a huge difference in overnight shipping costs. ShipBob’s network of fulfillment centers in major US cities can help you keep your inventory closer to more customers. This lowers the number of shipping zones each order has to travel, which can help you save money on expedited delivery options.
Plus, ShipBob’s cumulative shipping volume qualifies for discounts from major carriers to save ecommerce businesses even more money.
“Between having to pay staff salaries and forgo the bulk shipping discounts we receive through ShipBob, it would be much more expensive to do it all ourselves.”
Alli Reed, Owner and Founder of Stratia Skin
Get started with ShipBob today
While overnight shipping can be a more expensive option, offering it can help you exceed customer expectations (and convert more last-minute shoppers). Working with a 3PL like ShipBob can help you offer these delivery options to your customers at scale by storing inventory in multiple locations and accessing carrier discounts.
To start offering faster delivery and the cheapest overnight shipping options to your customers, sign up to learn more about ShipBob at the link below: