How to Choose Between UPS, FedEx, DHL for Your Business

How do business owners decide which shipping company best fits their needs?
February 23, 2012

Small-business owners and entrepreneurs who are ready to take their business to the next level often have concerns about transportation and logistics. A variety of shipping solutions help business owners build their companies.

How do business owners decide which shipping company best fits their needs? UPS, FedEx or DHL?

If your business only ships small packages occasionally, the U.S. Postal Service is probably the most affordable shipping option for packages weighing less than two pounds. The USPS isn’t the greatest with tracking packages or guaranteeing delivery dates.

Obviously, every situation is unique, but most business owners are concerned with three major criteria—price, reliability and service-area offerings.

“Most big businesses just pick one carrier for simplicity and because it has much bigger discounts on pricing," says Ryan Cheng, general manager of online jewelry store "Small businesses like us tend to utilize two to three carriers to maximize cost savings.

"The main factors determining which shipping method to use is cost of shipment, delivery time, package pick-up time, customer preference, price of good and reliability of the carrier. We use a custom formula in our e-commerce system to automatically choose the shipping method.”


UPS is the largest package-delivery company in the world and a leader in specialized global transportation and logistics services. When it comes to reliability and service, “Brown,” as UPS is known, historically leads the pack.

Delivering 15.8 million packages and documents to more than 220 countries and territories daily, UPS services addresses all over North America and Europe. Package drop-off is simple because UPS stores and authorized outlets proliferate.

“UPS can handle all packing and shipping through its network of more than 4,400 UPS Store locations," according to Tom Langa, UPS small and occasional customer segment marketing manager.

"There are more than 57,000 locations in the UPS retail channel network: drop boxes, customer centers, alliance partners and commercial counters. There are also more pickup options than any other major transportation carrier.”

DHL is a division of Deutsche Post DHL, a worldwide logistics firm linking more than 220 countries and territories worldwide. DHL ships 7 million items around the world every day. With 40 processing centers around the world, DHL is competitive for international shipping. However, according to the company's website, it does not ship domestically.

Next-day delivery service originally put FedEx on the map. It has expanded its service offerings to include global freight-forwarding services, including air and ocean solutions and much more.

"FedEx provides a wide range of transportation and business solutions that help small businesses thrive and grow both domestically and internationally," says Denise Yunkun, FedEx Director of Alliance Marketing, “including many Saturday services.”

The company offers convenient shipping from many OfficeMax locations. Business owners are able to ship easily within the U.S. and internationally. Plus, you can drop off packages and purchase packaging supplies in many locations.

The company also offers SmartPost, a cost-effective shipping service for sending low-weight packages to residential customers. According to the company website, SmartPost reaches “every U.S. address, including P.O. boxes and military APO, FPO and DPO destinations. You can even use FedEx SmartPost to ship to Alaska, Hawaii and all U.S. territories.”


Prices vary depending on your business needs. In general, the price difference between FedEx and UPS when shipping domestically is negligible.

Business owners take advantage of some great tools to make certain they get the best price on shipping. Here are a few websites that allow you to compare pricing.

  • ShipGooder compares shipping rates from national, regional and local delivery services. "Plug in your zip codes and ShipGooder will help you find the best deal," according to the Associated Press.

  • Shipping Sidekick offers real-time shipping rates quotes, direct from the shipping companies. This site, launched in 2006, offers a package-tracking feature that allows business owners to track their UPS, DHL, FedEx and USPS packages all in one place free of charge.

  • Shipwire advertises "enterprise logistics for everyone" and offers slightly more than shipping comparisons.

“I do not use comparison websites but I have the zone charts and rates printed for FedEx and USPS for easy reference when packing shipments,” says Jennifer Untermeyer, owner of TravelKiddy. The online toy store specializes in travel games, toys and gear for kids. She ships up to 300 packages a month, so Jennifer constantly researches shipping options and pricing alternatives.

No matter which shipping solution you choose for your business, speak with the company's reps and ask for the best discounts, deals and options.

Work closely with your shipping company, says Michael Hess, president and CEO of Skooba Design, a company that designs and manufactures carrying cases for technology-related products. He advises meeting with your shipping company rep and asking "Can we work together on this? Is there a volume that we’re not hitting that can get us a better price?"

"Every business transaction is a two-way street and shipping is no exception," says Hess, advice that applies to more than shipping.

Anthony Sills is a South Jersey freelance writer who has contributed to publications and sites such as The New England Job Show, The Historic Westside and Green City Times. He is currently working on his first book. Anthony blogs for Contently.