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Carrier Price Increases

May 15, 2018

How Changing Surcharge Definitions Affect Parcel Shippers

Parcel carriers announce general rate increases every year. Shippers are used to that, and most expect their shipment costs to increase by about 5 percent every year in line with GRIs. But where carriers make their money—and where shippers can be taken by surprise—is in accessorial surcharges. About 35 percent of companies’ overall shipping spend is eaten up by surcharges, according to Reveel’s research. Accessorial fees can be modified throughout the year, often without warning. They can also rise very quickly: UPS boosted its additional handling surcharge by 75 percent in 2018. Finally, surcharges are challenging because they affect every company differently. Large package fees might not affect a shipper of small parcels, but a modification in dimensional weight pricing might. Shippers can’t prevent parcel carriers from making these sudden, […]

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Apr 19, 2018

3 Major Questions About Parcel Carrier Surcharges Answered

Every year, FedEx and UPS announce “general rate increases” or rises in base rates, which both companies have held steady at 4.9 percent for several years. But general rate increases usually don’t tell the whole story. The major parcel shipping carriers continue to introduce new surcharges and accessorial fees, each often following the other’s lead. Last year, FedEx and UPS debuted holiday rates which appear to be here to stay. Back in 2016, UPS imposed a small fee on third-party billing. FedEx held out for two years, then added a 2.5 percent third-party billing fee in its 2018 rates. As you work to understand how rate increases will impact your shipping spend, it’s critical that you don’t merely add 4.9 percent to your budget. Related: Making Sense of Surcharges: 9 […]

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