It’s that time of the year—FedEx recently announced its general rates increase (GRI). Effective January 6, 2025, the shipping giant will implement a 5.9% average general rate hike across its primary services, including FedEx Express, Ground, and Economy. This increase will apply to both U.S. domestic, export, and import services.
Prepare for the 2025 FedEx rate increase with key insights from the experts at Lojistic.
What Is the FedEx GRI?
The General Rate Increase (GRI) is a practice employed by carriers like FedEx and UPS to adjust their shipping rates annually. While it's touted as a measure to keep pace with inflationary trends and offset rising operational costs, the reality is that it often serves the carriers' interests more than the shippers'.
FedEx and UPS 2025 GRI: A Familiar Tune
In mid-September, FedEx announced its GRI for 2025, implementing a 5.9% average rate increase across most of its services. UPS is expected to follow suit soon, often announcing a nearly identical rate increase. It's becoming more than clear that these major players march to the same beat, making it difficult for shippers to catch a break.
Surcharges
It’s important to note that the announced average increase doesn’t paint the complete picture. 5.9% is just an average figure that doesn’t account for costs like surcharges, fees, or contractual specifics. It’s critical to compare your specific shipping profile against the line items of the GRI. Look out for higher than average increases on surcharges you are hit with often, such as:
- Additional Handling (increased by ~25%)
- Oversize Charge (Increased by ~27%)
For many shippers, this could mean an average increase in excess of 12%-18%.
Minimums
The concept of 'minimums' in FedEx shipping pertains to the base cost a shipper will incur for sending any package, irrespective of any negotiated discounts or incentives. This minimum charge is set by FedEx for all the services included in a contractual agreement and is applied to every individual shipment.
Much like surcharges, minimum fees often catch customers off guard, resulting in higher costs than initially anticipated.
Although the minimum for ground shipments saw a rise of 5.8%, it’s important to note that minimums for the primary overnight services rose by ~6%. The slightly larger hike in overnight fees could be attributed to the guarantees in place for those service levels, as opposed to ground services, whose guarantees are still suspended (see why here).
Why Does GRI Matter?
For any business who relies on shipping, the parcel General Rate Increase (GRI) matters significantly because even a seemingly modest percentage hike can have a ripple effect on your company's operational costs, thereby affecting budgets and profit margins.
This extra cost is not just a line item; it's a financial burden that could otherwise be channeled into other operational areas like marketing, technology upgrades, or workforce expansion. To not be caught off-guard, companies need to anticipate the rate increase and adjust their own shipping strategies and charges accordingly.
Lower Your Shipping Costs with Lojistic
The 2025 FedEx rate increase is around the corner—are you prepared?
Given another year of expected shipping rate hikes, companies must use every resource at their disposal to manage and gain visibility over their shipping costs.
If this all feels overwhelming, consider leveraging Lojisitic's platform and team of experts who have successfully helped thousands of shippers save hundreds of millions of dollars – money the carriers would have otherwise kept. You could offset, eliminate, or even find savings above and beyond the GRI.
- GRI Impact Analysis: With our comprehensive Impact Analysis we can show you exactly how these changes will affect your business in the coming year, and ways you can mitigate these looming increases. Knowledge is power!
- Shipping History at a Glance: Our free platform allows businesses to see their shipping history clearly across multiple carriers and modes, offering valuable data to drive smarter decisions.
- Free Audit: Your Lojistic account automatically audits for invoice errors, enabling you to recover refunds and eliminate unnecessary expenses.
- Compare Mode: Businesses can utilize our "Compare Mode" to quantify the impact of changes like the rate increase on their shipping costs.
We also suggest reading our article on the UPS rate increase for 2024 (this will be updated with the UPS 2025 details as soon as they're announced). Understanding both FedEx and UPS rate adjustments will empower you to make informed decisions to optimize your shipping strategies and manage costs effectively.
Author
Rich Harkey
Rich Harkey
Senior Strategy Manager
As the Senior Strategy Manager at Lojistic, Rich leverages over three decades of expertise to help businesses improve their shipping strategies and reduce costs. With a deep understanding of the requirements of shippers and the operational intricacies of carriers, he excels in everything from optimizing business rules and managing carrier invoices to negotiating carrier contracts.
Rich's comprehensive knowledge of the logistics industry, combined with his strategic insights and passion for data analysis, has enabled thousands of companies to gain visibility into their shipping expenses, driving impactful results.