FedEx Shipping Rates: Important Tips to Keep in Mind
There aren't unique shipping charges or surcharges in FedEx shipping rates compared to UPS. They actually both have very similar charges and surcharges. The main thing that you want to take into account are the differences in those charges.
UPS might call something a large package surcharge. FedEx might call that same surcharge an oversize charge. When you look at the published rate charts, those charges actually match. This is because one carrier might give you a 50% discount off the charge and the other carrier might give you 50% as well. But, one is going to be more expensive than the other. This leaves you with a net charge that's might be higher. You want to make sure that you take into account the differences in the charges themselves. This is along with the discounts that the carrier might be offering you.
FedEx Surcharges
The surcharges might look the same, say an oversize or a large package surcharge. If one is higher than the other, FedEx might offer you a 45% discount or UPS a 50% discount. That 45% might be a greater discount because it's coming off of a lower published charge. So those are some of the things you want to take into account. As far as actual surcharges go, the naming convention of the surcharges might be a little different. But they pretty much have the same types of surcharges. This is outside of the late payment fee that UPS has that FedEx has not instituted yet. As far as FedEx shipping rates go, there's nothing new on the horizon.
The FedEx rates and the UPS rates are consistent after the first of the year. FedEx's rate change happened the first week of the new year. UPS's rate change actually went into effect the last week of the last year. There's an obvious advantage for UPS. It's so they can collect more revenue during the time of all the returns after the holidays after Christmas. They're able to take advantage of the new rates, on average 4.9%. But that 4.9% rate increase that both carriers published impacts customers. It does so in different ways depending on the characteristics of those shipments.
How the Lojistic Platform Can Help
Our Lojistic platform and our actual shipping platform will help customers reduce costs. It does this by giving the ability to rate shop. So, our platform rate shops between the two carriers. On the small package side, you've got FedEx versus UPS. It'll actually rate shop based on where the package is going. It also takes into account the weight and any other applicable surcharges.
Then on the freight side as well, it will rate shop between several different LTL carriers. It will even rate shop between full truckload carriers as well, depending on what you need. Like any other third party shipping solution, it is very robust. This is because it takes into account all the different charges that might apply to a package. It takes your net rates into account, and it picks and chooses the best rate possible.
Say you want to put in any other parameters like time in transit. You might have an SLA with a customer where the time in transit is specific. You want to take into account the time in transit along with the cost of that package. And the system will be able to spit out the least expensive option, or the lowest time in transit at the least expensive cost.
Author
Bryan Van Suchtelen
Bryan Van Suchtelen
Corporate Director of Parcel Rate Services
Prior to joining Lojistic in 2015, Bryan enjoyed a 26-year career with UPS where his roles included Pricing, Field Sales and Director-level Sales Management of some of UPS’s largest customers.
At Lojistic, Bryan leverages his wealth of experience/expertise to identify and execute supply chain cost management solutions for parcel shippers of all sizes. Bryan has helped his customers reduce their shipping spend by tens of millions of dollars.