In 2020, UPS and FedEx cut their service guarantees. Exponential growth in online shopping and a pandemic meant the carriers scrambled to make deliveries on time while keeping employees healthy. We wondered if the service guarantees were gone for good, or whether these money-back assurances would become the competitive differentiator between FedEx and UPS.
In 2021, we saw the partial return of service guarantees, a revocation during the holiday period, and another partial reinstatement in early 2022. On January 22, 2024, UPS announced that it would honor refunds for its second-day morning service. Four days later, on January 26, FedEx followed suit, reinstating its money-back guarantee for its 2Day® AM service.
While some of the most popular services, such as UPS Ground, FedEx Express, FedEx Ground®, FedEx Freight®, FedEx SameDay® City, and FedEx Office®, remain suspended, the carriers chose to reinstate the less-popular 2-day air morning service. The service assures the delivery of packages by 10:30 am for businesses or noon for residences in two business days.
We’ve all heard the saying, “All publicity is good publicity,” but the carriers really needed some positive promotion amidst the freight downturn. Restoring the 2-day air morning service was a low-risk move that resulted in positive coverage for both FedEx and UPS.
The FedEx website shares that the status of its money-back guarantee is “being evaluated on an ongoing basis, and our focus remains on continuing to provide the best possible service to our customers during this period of uncertainty.”
It’s possible, but in our opinion, it is unlikely that we will see service guarantees resume for the more popular services near term. FedEx and UPS must balance their reputation and benefits for customers alongside the capacity to run a profitable business. Long term? It will happen.
Service guarantees are one way customers can hold carriers accountable for providing the service they contracted.
These financial ramifications are back for many UPS and FedEx services, but many customers never take advantage of the refunds they’re owed. Why? Although the carriers have the technology to discover service failures, the impetus is on the customer to find the failure and file the paperwork to recover the refund. That’s a lot of work— especially when shipping hundreds or thousands of packages every day.
That’s where ShipRx can help. Our proprietary parcel audit software automatically runs over 40 checks on every package you ship to discover refund eligibility due to service failures and incorrect charges. Then, we will file the appropriate paperwork on your behalf, and you’ll see the refund on your next invoice.
Our parcel audit service is free to set up— we only charge a percentage of the refunds we recover, and you can cancel anytime. Get started in less than five minutes today and begin seeing refunds as early as your next billing cycle!
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