FedEx Service Guarantee Basics
FedEx service guarantee agreements work similarly to those from UPS. They actually call their FedEx service guarantee clause, "The Money Back Guarantee." That means that if you ship a package with FedEx in the United States, it should come with a guarantee. For example, if I'm shipping a package from Los Angeles to New York, I want that package delivered tomorrow. I'm going to ship that out the next day. It's guaranteed to get there tomorrow by 10:30AM. But if it doesn't arrive on time, I should be entitled to a refund for the transportation costs of the late package.
FedEx Service Levels and Guarantees
FedEx offers a spectrum of service levels tailored to your needs. These include:
- FedEx Ground: Ideal for reliable, cost-effective ground shipping.
- FedEx International Priority & Economy: Ensures your package's swift journey across international borders.
- FedEx Home Delivery: Designed for residential shipments, prioritizing convenience.
- FedEx Priority & Standard Overnight: For time-sensitive deliveries, ensuring next-business-day arrival.
- FedEx Two-Day: For packages requiring day-definite delivery less urgent than overnight.
Unfortunately, only overnight air and International Priority are currently eligible for refunds as of 2023.
FedEx Reimbursement and Money Back Guarantee
If your package doesn't meet its guaranteed delivery time, you may be eligible for a reimbursement.
FedEx Refund Process
Should your shipment fall short of the promised delivery time, here's a step-by-step guide to requesting a FedEx refund:
Gather Information: Collect all relevant shipment details, including tracking number and invoice.
Contact FedEx: Reach out to FedEx's customer service and explain the situation.
Submit Claim: Follow FedEx's claim submission process, providing the required documentation.
Review and Approval: FedEx will review your claim and approve it if it meets the criteria.
Receive Refund: Once approved, you'll receive your refund.
Eligibility Criteria
While FedEx's refund process is designed to be customer-friendly, it's essential to understand the eligibility criteria to ensure a smooth experience. Eligibility may vary depending on the specific service level and the nature of the delay.
Sophisticated Tracking Models
FedEx has very sophisticated tracking models. FedEx knows when they deliver a package late.
FedEx can credit me right away for that shipment. First, they put the onus on me as the shipper to identify that late package. Second, I have to contact FedEx and submit or file a delivery refund for the late shipment. They don't enforce the FedEx service guarantee themselves.
It's Your Responsibility
Some might think that FedEx is going to credit you right away for late shipments. This is one of the biggest misconceptions in the world of parcel shipping. This is not the case. It is your responsibility. So why aren't refunds credited back automatically? Well, FedEx is counting on the fact that you're not going to file for late shipments. If they were to make refund credit automatic, it would cost them hundreds of millions of dollars a year. That is why they don't enforce the FedEx service guarantee.
So, as a shipper, what can I do about it? So you have four options. The first option is to accept what it is and to do nothing when FedEx delivers a package late. That's not an option I would recommend. But what we find in our business is there are a lot of shippers out there who don't want to deal with the headache. The second option is to sign a money-back guarantee waiver. That means that you waive your right to file for late shipments in exchange for something else. The usual way FedEx structures this is they offer a few extra points built into your contract. It can look a variety of ways, but it works in the best favor of FedEx.
Audit Shipments Yourself
The first option is to audit your shipments yourself. For smaller shippers who don't have hundreds or thousands of packages a day, this could be an option. But for anybody that has any sort of volume, it's close to impossible.
At Lojistic, we understand the importance of efficient shipping invoice audits. That's why we offer a unique solution for shippers: our proprietary platform, designed to automate the identification of late shipments. By connecting your carriers, such as FedEx, to our platform, you'll swiftly pinpoint shipments that are eligible for refunds. However, once these late shipments are identified, it'll be your responsibility to file the necessary claims with FedEx to secure your credits.
Lojistic Handles FedEx Service Guarantees
Another avenue you might consider is entrusting the recovery process to a dedicated company like Lojistic. We don't just audit your invoices — we take that extra step. Once we've identified potential refunds, our full team of dedicated specialists will file claims for every refundable package on behalf of your company, fully automating the refund recovery process. This hands-off approach can save significant time for those who are already involved in the refund process and can be a goldmine for those who haven't been filing at all.
How Do You Get Started with Lojistic?
You know, logistics is not the most exciting topic, right? But the awesome thing about Lojistic is we make shipping fun. If you walk around the office, you'll see lots of smiles, you'll see high fives, you'll see people enjoying what they do. And what that translates to is happy employees translates to happy customers. Recently, we wrapped up a very large project for a very big shipper. And what did we do? We went and celebrated last Friday. We closed the offices down at 3:30 p.m. and went and had drinks as a company. You know, that's what we do here. We make shipping fun.
All you need to do is go to our website, lojistic.com, and create your own account, and then connect your carriers. You can see and experience for yourself what it's like to be a Lojistic customer. Right away, you can see cost savings opportunities the platform identifies for you and potentially start filing for late shipments we’ve identified on your account.
Author
Matt Bohn
Matt Bohn
Director of Parcel Rate Services
Prior to his role at Lojistic, Matt held significant positions in the industry, including his tenure as Senior Pricing Advisor at FedEx. Matt analyzed pricing programs and wrote pricing contracts for some of FedEx’s largest e-commerce and retail shippers. He also managed projects for the FedEx Global Pricing Approval Systems and Strategic Account Executive Inputs.
Matt earned a BS in Computer Engineering and an MBA in Finance from the Joseph M. Katz School of Business at the University of Pittsburgh.