The 2018 FedEx and UPS Rate Increases: A Closer Look

November 20, 2017 at 10:12 AMLeah Palnik
FedEx and UPS Rate Increases for 2018

With the New Year approaching, it’s time to look at the UPS and FedEx rate increases for 2018 and how they will affect your costs. In September, FedEx announced an average increase of 4.9% on Express and Ground services. UPS joined the party in October, announcing that they will also be increasing their rates by an average of 4.9%. The new 2018 UPS rates will take effect on December 24, 2017, while FedEx will be instating them a week later on January 1, 2018.

The averages might be the same, but the rates vary. With higher increases for some services and lower increases for others, you can’t budget based on your costs increasing 4.9%. It’s important to look at what services you use, your package characteristics, and the locations you’re shipping to, and then evaluate the new rate charts to find your biggest cost offenders from the 2018 FedEx and UPS rate increases.

On top of the FedEx and UPS rate increases for 2018, there are additional updates that are likely to affect your shipping costs. First, UPS is lowering its dimensional (DIM) weight divisor from 166 to 139 for domestic packages less than or equal to one cubic foot (1,728 inches) in size. With this change, UPS and FedEx are back in line with each other on how they calculate dimensional weight. Both carriers will now use 139 for all domestic and international packages.

It’s been a wild ride the past few years with multiple changes to which packages DIM weight pricing applies to and how it’s calculated, so this is a welcome stabilization. However, a lower divisor means a higher chance that your package will get billed at your DIM weight, rather than your actual weight. If you ship packages one cubic foot or under with UPS, it’s important to take note and make changes to eliminate any unused space in your packaging or consolidate orders when possible.

Surcharges are also increasing, with some at alarming rates. Most notably, in 2018 FedEx and UPS are coming after larger, oversized packages. Not only are they increasing at a higher rate than most surcharges, they are by far the most costly. For example, the FedEx Unauthorized Packages fee is increasing from $115 to $300 and the UPS Over Maximum Limits charge is increasing from $150 to $500. The shipping trends that have resulted from the rise of e-commerce has taken its toll on the carriers and they’re having to move more and more oversized packages that can’t go through their automated systems. Time is money, so they’re tacking on hefty fees to make up for it.

Ahead of the new FedEx and UPS rate increases for 2018, new holiday peak season charges will also apply. UPS is adding peak surcharges on domestic residential packages during the busiest shipping days of the year – from November 19 to December 2 and from December 17 to December 23. These fees will add up quick when you have an increased amount of orders over the holidays. 

In a notable departure from UPS, FedEx decided not to add a peak season surcharge this season. Instead they opted to increase surcharges for packages that are big or bulky enough to require special handling. UPS is also increasing the cost of larger packages by adding additional peak season surcharges on top of the already existing surcharges. The 2018 UPS rate announcement included increases for these surcharges for the next holiday season, so you can expect this trend to continue.

The 2018 FedEx and UPS rate increases are proof that the carriers are getting smarter, hitting shippers where it hurts most. Luckily, you don’t have to navigate the changes alone. The shipping experts at PartnerShip have evaluated the new rate charts and we have completed a detailed analysis, so it’s easier for you to assess the impact on your shipping costs. Download our free white paper today!

Download the free white paper: A Closer Look at the 2018 FedEx and UPS Rate Increases

Holiday Shipping Schedule 2017

November 16, 2017 at 3:15 PMLeah Palnik

Thanksgiving is coming up, and Christmas and New Years are just around the corner! It's a busy time of year, so we've put together a shipping schedule that you can use to plan around carrier closures. 

check out the 2017 holiday shipping schedule

Days of operations for PartnerShip are listed as well. As always, we're here to help you ship smarter during the holidays. If you need help, give us a call at 800-599-2902 or email sales@PartnerShip.com. 

Winter Weather Tips for Shipping Managers

November 2, 2017 at 3:45 PMLeah Palnik
winter weather tips for shipping managers

During this time of year, shipping managers need to be on their toes to stay ahead of winter weather delays. If there’s anything we’ve learned in the past several months, it’s that Mother Nature shows no mercy. Hurricanes Maria, Irma, and Harvey hit, and delivery networks suffered. As Ned Stark famously stated, winter is coming. And with it comes all the unrelenting ice and snow that can wreak havoc on your transit times. The more prepared you are when these storms hit, the better, so we’ve put together a few tips:

Build in extra days for time-sensitive shipments. This might seem like a no-brainer, but it can be challenging if you don’t plan ahead for it. Planning is especially important leading up to the winter months and during the holidays, so be kind to yourself and get started now. This will be essential for your supply chain if you’re shipping cross-country or to areas that are prone to winter storms.

Work with a broker to strengthen your carrier network. With winter storms causing service issues for carriers this time of year, you may need to think about expanding your network. Working with a broker is an easy way to gain instant access to additional resources. Brokers typically work with a vast amount of carriers and have the knowledge to match you with services that would be best for your lane and delivery needs.

Be flexible when possible. If you have some wiggle room with pickup and delivery dates, it’ll be easier to work out an economical solution with your carrier when weather delays strike. Also avoid setting up unnecessary appointment times that could restrict the driver. If the window of time is too short and the shipment gets held up due to weather, you could be delayed a whole day rather than a few hours.

Pay attention to service alerts from your carriers. Staying on top of weather issues can be difficult. Luckily many carriers have service alert pages on their websites and some will even send you notifications when they experience weather-related closures or limited operations. Here are a few service alert pages for common carriers: 

Shipping to a tradeshow? Prepare for the worst. If you’re shipping your exhibit materials to a tradeshow, it’s a good idea to have it sent to the advanced warehouse so you don’t have to worry about it delivering on time. Otherwise, you’re shipping direct to the show site which leaves you vulnerable to devastating delays. If you’re not able to ship to the advanced warehouse, have a contingency plan in place so if you’re stuck at the show without your booth it’s not a total loss. Determine ways you could print materials on-demand ahead of time or bring a few merchandise samples with you.

Communicate clearly with customers. During the busiest time of year for retailers, how you deliver on customer expectations can make or break your business. Customers are ordering holiday gifts online and making sure they arrive in time is essential. Add some buffer days to your transit times and make shipping deadlines clear and visible throughout the entire ordering process.

Budget for increased rates. Going into this winter season, truckload capacity is already tight, which has driven rates up. Drivers will also need to comply with the new ELD mandate starting December 18, which puts an additional strain on carriers. Now more than ever, you’ll need to be savvy to navigate the season.

Being proactive is the first step towards smooth shipping in the winter months. Planning for the inevitable bad weather will help you to not miss a beat when you encounter a service disruption. When you work with PartnerShip, our shipping experts can find solutions that are right for you. Get a free analysis today!

Get a free shipping analysis!

Truckload Rates Are Going Way Up. Are You Ready?

October 31, 2017 at 12:13 PMJerry Spelic

Truckload shipping costs have been steadily climbing and are poised to go even higher because a perfect storm of events is pushing truckload rates to record highs: the looming Electronic Logging Device (ELD) mandate; the cleanup and aftermath of Hurricanes Harvey, Irma and Maria; and an already significant driver shortage that has stressed truckload capacity.