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 UPS rates will take effect on December 24, 2017, while FedEx will be instating them a week later on January 1, 2018.
Here are some quick facts:
• FedEx Express, FedEx Ground, and FedEx Home Delivery rates will increase an average of 4.9%
• UPS Ground, UPS Air, and international rates will increase an average of 4.9%
• UPS is lowering the dimensional weight divisor to 139 for domestic packages less than or equal to one cubic foot in size (1,728 cubic inches)
• Surcharges for larger packages will rise sharply
• FedEx is adding a 2.5% third party billing surcharge to match UPS
• Additional surcharges and increased rates will apply during the 2017 holiday season
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. You will need to evaluate the new rate charts, the surcharge increases, and other changes to find your biggest cost offenders.
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. PartnerShip®, the company that manages the NAC Shipping Program, has evaluated the new rate charts and completed a detailed analysis, so it’s easier for NAC Members to assess the impact on their shipping costs.
Download the free white paper at PartnerShip.com/RateIncrease!
When you enroll in the NAC Shipping Program, you receive exclusive discounts on select FedEx® services – helping to offset the 2018 rate increases. For more information or to enroll today, visit PartnerShip.com/NAC or call 800-599-2902.