With the year 2021 drawing to a close, businesses are preparing their budget for 2022. Did you know that the yearly shipping rates offered by carriers have seen an exponential increase? FedEx announced the rate increase for 2022, and it is not the same as before. Here, we will discuss the FedEx rate increase for 2022 and its impact on business. Further, we will explore how small parcel audit services help shippers save money despite the rate increase.
General Rate Increase by FedEx
Initially, we need to discuss the concept of a General Rate Increase (GRI). A GRI denotes an increase in shipping rates applied by the shipping carriers. According to US regulations, a shipper has to receive notification of a new GRI at least 30 days in advance. Since 2013, the GRI yearly increase was about 4.9%. However, for 2022, parcel carriers like FedEx and UPS have increased the GRI by an average of 5.9%. The hike is due to the high demand for e-commerce shipments. The parcel carriers are spending more to transport small parcels and freight.
Ways to handle GRI with audit intelligence
Shippers prepare their annual budget early with the announcement of the new GRI. Partnering with small parcel audit services like Audintel helps shippers understand their shipping profiles. The different aspects of a business’ shipping profile include
- the type of services
- weight of packages
- dimensions of packages
- pick-up and delivery locations
- surcharges.
Audintel helps its customers identify the specific aspects of the shipping profile that need consideration. For instance, customer X ships products through FedEx Ground service. Our role is helping customer X receive discounts on fees and surcharges, specifically for FedEx Ground service.
Contrasting features between GRI and Surcharges
GRI involves an increase in the shipping rates for a long time. For instance, GRI was about 4.9% since 2013. Further, surcharges are the additional top-up costs for a specific service, zone and have a short timeline. The change in global demand and supply of goods affects GRI. Surcharges vary with each shipment and may change randomly. For example, an additional handling surcharge is not for every shipment. The surcharges may differ for each shipping carrier.
FedEx Rate Increase of 2022 and its impact on businesses
FedEx announced FedEx Rate Increase for FedEx Express, FedEx Ground, and FedEx Home Delivery services from January 3, 2022. The increase is for domestic, export, and import Services. This rate increase of 5.9% does not include surcharges and other fees of the shipping carriers. The rise in shipping rates, new surcharges, and fees impact businesses. As a consequence, shippers have to adjust their annual budget or pass on the extra expenses to the customers. Alternatively, shippers can balance out their shipping costs to some extent by using the software solutions offered by audit services.
FedEx surcharges of 2022
FedEx surcharge increase is different for each shipper, based on the corresponding agreement. The fuel surcharge is in effect from November 1, 2021. It is due to fluctuating fuel prices and the rates calculated by the oil companies. Similarly, there are surcharges such as Additional Handling Surcharge, Delivery and Returns surcharge, and many more. The surcharge increase is by zone as well as by weight. For instance, the Oversize surcharge by FedEx US express/ Ground in zone 2 has increased by 4.76%. For further information about FedEx’s surcharges and fees, click here.
How can Audintel help shippers?
Audintel analyzes the data and the kind of packages shipped by the clients. Our team studies the shipping patterns of shippers. Audintel recommends cost-reducing opportunities to shippers. We help our clients receive discounts on surcharges and fees from the parcel carriers. In addition, we negotiate or renegotiate the shipping contracts on behalf of our clients. Audintel also suggests alternatives to FedEx with cheaper regional carriers. In this way, we optimize shipping costs for our clients.
Conclusion
When expenses rise, we often wonder whether we can afford them. Similarly, the FedEx rate increase has made shippers think about their shipping costs. Audintel explains complex carrier agreements to our clients so that they get the best rates. We help businesses negotiate their shipping contracts effectively and save money. Our experts help shippers optimize their shipping spend. We have the best audit services to manage shipping costs. For further information about FedEx General Rate Increase (GRI), contact us at [email protected]. Learn about us by visiting the Audintel website or call us at +1 (619) 354 8539.