Dive Brief:
- Pitney Bowes and Auctane are each rolling out discounted FedEx rates for their customers, the companies announced in October news releases.
- Pitney Bowes said users of ShipAccel, its shipping platform for e-commerce businesses, can immediately access the discounted rates. A full expansion to the rest of Pitney Bowes' services is expected by the end of this year.
- For Auctane users, the FedEx Platform Account program will roll out within the company's product suite starting in November. Auctane's brands include ShipStation, Stamps.com and ShipEngine.
Dive Insight:
The discounts, via FedEx Platform Account agreements, apply to shipping options across FedEx's full service portfolio. The announcements didn't disclose the full extent of the reductions, but Pitney Bowes previously said that customers could see FedEx discounts of up to 90% through ShipAccel.
Discounts provided within shipping platforms — which UPS and the U.S. Postal Service offer as well — are particularly useful for small and medium-sized businesses. These companies would otherwise have to negotiate for lower rates on their own, a tall order for shippers without enough order activity to drum up volume-based discounts.
The arrangement also benefits carriers by making their rates more attractive for a sizable pool of potential customers using these platforms. For example, Auctane said it has millions of customers in the U.S. and Canada, and its technology powers more than 3 billion e-commerce orders annually.
For years, FedEx's lack of platform rates made it harder to compete with UPS for small and medium-sized business volume, Nate Skiver, founder of parcel consultancy LPF Spend Management, said in a LinkedIn post. More platform-wide discounts could help FedEx close the gap, he added.
FedEx has been doing just that since 2020, launching shipping discounts through the platforms BigCommerce, Shippo and EasyPost. The more recent Pitney Bowes and Auctane agreements will help further streamline the shipping experience for smaller businesses, FedEx executives said in the October announcements.
"Today's global ecommerce space is complex for even the most sophisticated merchants, and we look forward to simplifying it however we can," Ryan Kelly, FedEx VP of commercialization, said in the Auctane news release.
