Are you ready for the holiday shipping season?
For the third year in a row, UPS and FedEx are adding additional surcharges to certain packages during the holiday season: packages that require additional handling, oversized packages, and unauthorized packages. This peak pricing is definitely here to stay – and some are already in effect.
FedEx Holiday Shipping Surcharges
FedEx hasn’t made significant changes to their pricing structure from 2018, but the 2019 surcharges have increased across the board.
| Surcharge (per package) |
% Increase (from 2018) |
Effective Dates | |
|---|---|---|---|
| Additional Handling Surcharge | $4.10 | 28% | 11/18/19 – 1/5/20 |
| Oversize Charge | $37.50 | 36% | 10/21/19 – 1/5/20 |
| Ground Unauthorized Package Charge | $435 | 190% | 10/21/19 – 1/5/20 |
These peak surcharges will be added on top of the usual fees for each type of package, and in addition to standard shipping costs. Like last year, these fees won’t be added to residential deliveries.
Additional Handling Surcharge
FedEx’s standard additional handling surcharge is assessed based on which criteria the package falls into. This includes:
- Dimensions: Package is greater than 48 inches on its longest side or greater than 30 inches on its second-longest side.
- Weight: Package weighs more than 70lbs.
- Packaging: Problems with the packaging include not being fully encased in corrugated cardboard, or if the item is shrink wrapped, cylindrical, has any protruding items (like wheels or handles), or could cause damage to other packages.
You should note that this also includes problems that happen during transit, and is always under the discretion of FedEx.
Pricing for the normal surcharges breakdown as follows:
Surcharge (per package)
- Dimension: $13.50
- Weight: $20.00
- Packaging: $12.00
The holiday peak charge of $4.10 will be added onto the prices listed above. You could end up with an additional $24.10 added to each overweight package you ship.
Oversized Surcharges
When shipping FedEx, oversized packages are over 96 inches long or 130 inches in total length and girth, and will cost you $90 plus the additional $37.50 holiday surcharge. This applies to U.S. Express Package Services, U.S. Ground Services, International Ground Service.
Oversized packages sent through FedEx will cost you $127.50.
Ground Unauthorized Package Charges
At a 190% increase, this charge has the biggest jump from the 2018 holiday season. Last year, the peak charge was only $150 and is now $435. However, the normal surcharge had gone from $150 to $650 earlier that year and has remained the same throughout 2018.
Unauthorized packages are those that meet any one of the following criteria:
- Measures more than 108 inches in length
- Measures more than 165 inches in length and girth combined
- Weighs more than 150lbs
This means, for any unauthorized package shipped between now and January 4th, you’ll be hit with a $1,150 charge – and your package might not even get to its destination. This is definitely an incentive to make sure you’re following FedEx’s shipping rules.
And don’t forget – FedEx pricing is changing on January 6, 2020. Go here to see the new rates.
UPS Holiday Shipping Surcharges
Taking a sharp turn from last year, UPS has chosen to follow FedEx’s lead and not add any surcharges to residential deliveries. The company says they’re passing on the savings created by the efficiency of their new Super Hubs and fleet expansions.
But they still had some significant increases to their 2019 holiday surcharges.
| Surcharge (per package) |
% Increase (from 2018) |
Effective Dates | |
|---|---|---|---|
| Additional Handling Packages | $3.60 | 14% | 11/24/19 – 1/4/20 |
| Large Packages | $31.45 | 20% | 10/1/19 – 1/4/20 |
| Over Maximum Limits | $250.00 | 51% | 10/1/19 – 1/4/20 |
Most of these charges are already in effect, with the exception of the additional handling packages surcharge, which starts the Sunday before Thanksgiving.
Additional Handling Packages
Additional handling packages have a lot of fine print, but basically it comes down to items that are too heavy, too long, or packaged improperly.
Here’s the definition in detail:
- Packages weighing over 70lbs.
- Packages in shipment with an average weight of over 70lbs, when weight specifications aren’t listed. (Always list package weights.)
- The longest side of the package exceeds 48 inches or the second longest side exceeds 30 inches.
- Packages that aren’t fully encased in corrugated cardboard.
- A cylindrical package not fully encased in a corrugated cardboard shipping container.
- Any package that must be routed through UPS’s irregular package sortation process.
Ultimately, UPS has the discretion to determine which packages require an additional handling charge.
Like FedEx, the regular fees are based on which criteria your package meets.
| Domestic Fee | International Fee | |
|---|---|---|
| Weight | $23.00 | $14.25 |
| Length | $14.25 | $14.25 |
| Width | $14.25 | $14.25 |
| Packaging | $14.25 | $14.25 |
Luckily, you don’t have to pay multiple fees per package. Only one additional handling charge is added, and the fees are assessed in the following order: weight, length, width, packaging. If you’re already paying a large package surcharge, you won’t have to pay an additional handling charge on top of it.
So with the peak charge added, you could be paying an additional $26.60 per package.
Large Package Surcharge
The large package surcharge is must simpler to assess. A $95 fee is added to your shipping charges when the package is either 96 inches in length or when the length plus girth is over 130 inches.
That means it’ll cost you $126.45 to ship a large package this holiday season.
Over Maximum Limits Surcharge
This regularly $650 over maximum limits charge applies to packages that are not generally accepted by UPS, but are found within the UPS system. This includes packages with a weight of over 150 pounds, exceeds 108 inches in length, or exceeds a total of 165 inches in length plus girth. Beware, because these packages can also be returned to you at your expense – costing you money without even getting the package to its destination.
Should you ship something over the maximum limits between now and the end of the year, it’ll cost you $900.
Why Do These Fees Exist?
Higher pricing during the holiday season makes sense for these shipping giants. FedEx delivered over 15 million shipments a day globally in FY2019, and UPS ships an average of 20 million. But these numbers nearly double toward the end of the year. UPS estimates it will deliver more than 32 million per day this holiday season.
Both companies hire thousands of seasonal employees to keep up with the extra work. FedEx plans to hire an additional 55,000 and UPS 100,000 this year – mostly drivers and handlers.
How to Prepare for the Holiday Shipping Season
The nuances of these surcharges can seriously increase your shipping costs if you’re not prepared. Now that we know these fees are coming around each year, it’s easy to prepare for this and future holiday shipping seasons. Know what you’re likely to ship, how big it is, and where it goes so you can plan for these increases.
But this only works if you know your shipping data. Schedule a consultation today.
The Reveel App uses AI and machine learning to provide an unparalleled look into what’s impacting your bottom line. Through invoice audits, peer benchmarking, and rate modeling/simulations, you can see the health of your operation and assess pricing changes from parcel carriers like FedEx and UPS. Sign up for a free Reveel account today to see how you can leverage automation to synthesize your data, ship more for less, and reduce the time needed to identify issues and action items.
