It’s that time again: shipping rates are on the rise! Both FedEx and UPS announced a general rate increase (GRI) of 4.9% this year, but the changes aren’t as simple as it sounds.
Here’s where it gets complicated: that 4.9% increase wasn’t implemented across the board. Not every service was affected, and some changed way more than others. Some services only saw their price change by pennies, while others cost hundreds of dollars more!
Even trickier, UPS and FedEx didn’t make the same changes to the same services. Even if one carrier raised their rates on a service, it might still be cheaper than their competitor. Just looking at the rate increases is like comparing apples to oranges!
What’s a smart shipper to do when confronted with this tangled web of shipping rates? Don’t sweat it, Ernest’s got your back. Here are some traps to be aware of so you don’t fall victim to hidden rate increases.
If your business uses drop shipping, prices this year have done everything but drop! Third-party billing has become increasingly popular in the age of online shopping. FedEx is keeping their rate of 2.5% for the service, but UPS is bumping theirs up by 44% to a total of 4.5%.
If you’re shipping lightweight items to residential addresses, you’re probably familiar with UPS’ SurePost and FedEx’s SmartPost services. Your carrier of choice handles your product for the majority of the trip, then USPS handles final delivery.
That flexibility is going to start costing you. If your package weighs less than a pound, you’ll pay 52% more through UPS than you would with FedEx. Slightly heavier packages will also cost more through UPS, but the change isn’t nearly as drastic.
There’s a shipping war being waged on big, bulky items. This year Amazon took a stance against vendors selling large and heavy items, and it looks like UPS and FedEx are following suit.
If your package is heavier than 150 pounds, longer than 108 inches or is larger than 165 inches in length and width combined, prepare to pay more. FedEx will charge you $675 for your package, but UPS will charge you a whopping $850!
It might seem impossible to dodge these rate increases, but at Ernest we live to overcome the impossible! For over 70 years we’ve prided ourselves on keeping costs low for our clients. Frequently the key is finding ways to reduce the size and materials needed for your package. That’s where our dim weight calculator comes in, so you can know the metrics your carrier will use to charge for your package.
It gets even better: with our latest app — the Stacking Strength Calculator — we can better prepare your package for the tough test of freight. Learn how to maximize the strength of your carton while minimizing your cost of construction. It’s a win-win!
Check out our infographic to keep an eye on shipping rate changes that affect your business.