Comparing UPS and FedEx in the Global Economy


Comparing UPS and FedEx in the Global Economy

UPS and FedEx are among the world’s largest small-package carriers, both by revenue and volume. When you compare UPS and FedEx, both offer ground, air, and ocean freight shipping and shipping-related services. FedEx and UPS ship over 10 million packages daily for businesses and individual customers worldwide. A consideration of UPS vs. FedEx rates can be a relative competition “see-saw”.

While the global economy is trying to find its footing, UPS’s earnings in the coming years will still rely heavily on the U.S. economy. In fact, domestic shipping revenue currently accounts for 62 percent of UPS's total package business. This dependence on the U.S. economy was apparent in UPS's 2009 second quarter when it lost 4.6 percent of its domestic volume and reported a 49 percent decline in earnings. Shippers should compare UPS vs. FedEx rates in this segment. They should also compare UPS and FedEx in terms of services.

UPS generated most of its revenues via U.S. parcel services—over 62 percent or $28 billion in 2009. This includes letters and packages up to 150 pounds over air and ground delivery. UPS will endeavor to boost its position as the leader in U.S. Domestic shipping by cutting shipment times and expanding services. These include tracking, intra-company shipping for clients with several locations, and systems integration options that enable large clients to track UPS data on their own IT systems. In comparing UPS vs. FedEx rates, it's important to note these enhancements.

Once again, when you compare UPS and FedEx, FedEx offers virtually every service provided by UPS via four corporate segments--FedEx Express, FedEx Ground, FedEx Freight and FedEx Services. This includes transportation, e-commerce, and business services in the U.S. and overseas. FedEx Express offers various shipping services for packages and freight. It also provides international trade services in customs brokerage, and ocean and air-cargo distribution; customs clearance services; and global trade data. FedEx and UPS differ slightly in revenue with FedEx generating over $33 billion in 2009, while UPS revenues exceeded $45 billion. That said, UPS vs. FedEx rates still remain highly competitive.