FedEx Follows UPS in Adding New Peak Surcharges

FedEx Follows UPS in Adding New Peak Surcharges

FedEx Rate Increase

COVID-19 continues to have far-reaching consequences for shippers. Throughout the pandemic, carriers have been adding and changing surcharges to cope with the disruptions to their networks.

Last week, UPS announced a significant surcharge increase – not only for shipments to and from Asia but for domestic ones as well.

This week, FedEx followed suit with similarly drastic surcharge increases that are sure to impact shippers of all sizes.

New FedEx Peak Surcharges

According to FedEx:

As the impact of the virus continues to generate a surge in residential deliveries and has also generated a surge in oversize, hard-to-handle packages, we have experienced increased operating costs across our network.

The following surcharges go into effect on June 8th, 2020, and will continue until further notice, according to the company.

Surcharge Name Applicable Service Surcharge Amount
Temporary Surcharge FedEx SmartPost $0.40 per package
Peak — Oversize Charge Oversize U.S. domestic FedEx Express and FedEx Ground $30.00 per package
Peak — Residential Delivery Charge U.S. domestic residential FedEx Express and FedEx Ground packages $0.30 per package

How to Mitigate Cost Increases In the Post-COVID World

It’s possible that pricing changes like this one will be with us long after the pandemic subsides and we reach some sort of “new normal.”

In order to mitigate these increases, visibility is now more important than ever. Shippers now must ask themselves how they can become more effective and deliver shipments faster to their consumers at cheaper costs. This question is impossible to answer if they don’t have deep visibility and insights into their shipping operations

How does a shipper even start to define what “better” looks like if they don’t (quantitatively) understand the current state of affairs?

In addition, network optimization will play an even more significant role, especially for those shippers who are working to shift their channels to offset the changes in purchasing habits of consumers.

As we continue to reopen the economy, shippers will only survive if they can quickly adapt to an ever-changing world, which means they will need to have their finger on the pulse of their transportation data at all times.

The days of being more than 30 days behind in understanding your supply chain are gone and shippers need to find partners like Intelligent Audit who can quickly turn massive amounts of disparate data into actionable business intelligence in real-time.

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