I have been in the shipping business for a long time, actually working at one of these companies, therefore I can tell you exactly what you are dealing with here.
As a rule of thumb if you are just selling a few items you should just ship USPS. USPS is a simple way to ship products, and it is very fast within the states. The prices for USPS will also be half that of your standard FedEx, or UPS rates because USPS is a government service, it is not a business like FedEx and UPS who must appease stock holders with big profits. USPS postage costs help them break even on wages, fuel, etc and they do not seek profit like private shipping companies do. This isn't to say that UPS and FedEx are bad, it is just that you must understand the difference.
Another benefit of USPS is a product they have called flat rate packages. These are priority mail (2-3 days) and have no weight limit (actually it is 70 lbs). If it fits in the box you can ship it for a flat rate. This makes shipping estimates really simple, and very affordable. Plus the packaging materials are free. You can go to usps.com and order 500 flat rate boxes without paying a penny. One last benefit of USPS is that they ship to nearly every residential address in the U.S. at no additional cost. As you start shipping with UPS or FedEx you may start to encounter extra shipping charges to certain home addresses and some addresses which are not accepted at all. Lastly, USPS ships 6 days a week at no charge. Unlike FedEx and UPS which only ship M-F (saturdays and holidays are additional $$$)
Those are the good things about USPS, but there are good things about the other guys too. As you start to grow in the volume of products that you are selling you can negotiate deals with FedEx or UPS to get large discounts on shipping. With my company, we have a deal where we can get free two-day shipping with FedEx for the price of priority mail with USPS. It is true that we have minimum shipping standards that we must hit each month to maintain this deal, but as long as you are consistent with sales, your company may benefit from this as we have. UPS and FedEx are also much more business friendly then USPS. In general USPS is designed for individuals or small volume shippers. I could go on and on about the business tools that FedEx and UPS provide, but trust me they are plenty.
Last point I want to make is that I would almost NEVER ship internationally with USPS. It is worth the extra money to go with FedEx or UPS. This is the simple reason why: although USPS is a very dependable shipping service within the states, their arms don't stretch any farther then that. Let's say you need to ship a product to Belgium. If you ship USPS then USPS will ship the item to Belgium where it will be dropped off in customs. Then USPS is done, they pack up their plane and fly back home. You are now in the hands of the extremely unreliable postal service in a foreign country. USPS doesn't care if your product makes it through customs or that it makes it to its final address in a timely fashion. Their job is already done. On the other had shipping with UPS and FedEx or DHL (DHL specializes in international shipping) these guys are in charge of getting it to its final address. So they will make sure it gets through customs and they will make sure it gets delivered because they are the only ones handling the package.
In the sad event that you have a problem with the shipment, if you call USPS they will just tell you to contact the final foreign shipping service. Good luck getting them to help you. On the other hand if you ship FedEx, DHL, or UPS then they will be able to help you because they didn't just hand off the product and run away.
All in all, it really comes down to volume. If you are sending less than 8-10 items a day then you will probably save a lot of money with USPS. If you start sending more than this, then I would consider getting a deal worked out with a Private shipper like UPS or FedEx.
Lastly, I almost forgot. Contrary to popular belief, USPS does not offer a tracking solution. For true tracking you need to go with FedEx or UPS. USPS offers a service called Delivery Confirmation. This service is 80¢ extra (free when purchased with priority mail and a click n ship account) and will often include complimentary scans showing it moving. The only guaranteed scan you will get is that it is delivered. YOu will have many customers that are confused. They will get mad thinking that you didn't give them tracking because the item didn't get any scans until it was delivered. In reality you do not have control over this. It is pure luck as to how many tracking scans you will get. Before you offer "Tracking" make sure you are shipping UPS or FedEx.
Oh, and never ship International with USPS, and if you do, make sure you buy insurance. Our track record with USPS international shipping being lost, or majorly delayed is about 20-25% of our packages. To us, 1 in 4 packages is too high of a risk that it is worth the extra money.
