FedEx Rate Changes for 2019

FedEx Rate Increase

Continuing the trend of price increases for carriers, FedEx has recently announced changes to its pricing for 2019.

Leading up to the 2019 changes, FedEx has made slight changes to other aspects of pricing and surcharges:

  • September: Increase in Additional Handling Surcharge for packages above 70lbs.
  • September: Changes made to surchages tables for Express and Ground.
  • Holiday Season: No additional surcharges for residential, but some additional surcharges for Ground and Express during the holiday shipping season.

General Rate Increase for 2019

Starting January 7th, 2019 FedEx will be implementing a host of changes to its pricing, surcharges, and fees.

Here’s how they break down:

  • Express and Ground Rate Changes: A 4.9% increase for Express package and freight standard list rates (US, US Export, US Import Services), as well as Ground and Home Delivery list rates. There will also be rate increases for International Premium, FedEx Express (minimum rates), Ground Multiweight, and Smart Post
  • One Rate Pricing: FedEx One Rate pricing will change to a rate that will be announced in the near future
  • Freight Rates: An increase of 5.9% will be applied to FXF PZONE, FXF EZONE, FXF 1000, FXF 501, and FedEx Freight box (and other related series base rates).
  • Retail Rates: FedEx Retail Rates will change to a rate that will be announced at a later date

Click here to see the official announcement from FedEx.

Rate Changes Within Context

An annual rate increase is nothing new for carriers. However, within the context of our current shipping environment, it another indicator of the challenges that shippers will be facing going forward.

Beyond General Rate Increases, shippers and carriers are facing a myriad of challenges such as increased reliance on online shopping, a shortage of drivers, and trade tensions. In addition, labor issues with UPS are creating a potential for a labor strike at the very worst time for shippers – peak holiday shopping season.

Dealing With the Reality of Increasing Prices

While many shippers may hope for a change in the price trend, it’s imperative to deal with the reality as it exists. Therefore, shippers need to focus on mitigating these price increases. Luckily, there is a myriad of strategies and tools that can be used to accomplish this.

  • Freight Audit & Recovery: Shippers can utilize a technology-based freight audit and recovery solution in order to identify cost-saving opportunities and invoice discrepencies
  • Contract Optimization: Carriers often inflate margin collection and shippers need to work with a partner that has a vast amount of industry experience in order to negotiate an optimized carrier contract that is in the best interest of the shipper.
  • BI & Analytics: Shippers can use better and more robust data in order to streamline and make better business decisions.
  • Finance & Accounting Tools: Having powerful tools to help improve accuracy of accurals and coding of logistics charges enables shippers to overcome potential hits to their bottom line resulting from cost increases
  • Freight Payment Solutions: Shippers can leverage freight payment solutions that enables them to stream line their existing freight payment systems, relieving the burden on other aspects of their business.

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