SiftedAI Copilot: LIVE NOW - Watch Demo

Sifted logo

The Impact of FedEx and UPS’s New Fees: Strategies for Managing Shipping Costs in 2023

by Shelby Kimball

Feb 22, 2023

6 min read

Looking for a better explanation of the new FedEx and UPS fee changes for 2023? You’ve come to the right place.

The general increase was one thing, but carriers continue changing service fees and guidelines that can be confusing and difficult to track. And some of these changes are serious, with fees that could hit your bottom line hard.

While the announcement of a 6.9% GRI was higher than hoped, that’s just the tip of the rate increase iceberg. From 2020 (pre-Covid) to 2023 (post-Covid), carriers have hiked accessorial and surcharge fees by a staggering 10% to 20%. For many of our customers, this means their actual shipping year-over-year rate increases have been in the double digits.

The exorbitant increase in accessorial fees indicates that efficiency is a priority for both carriers. FedEx and UPS are focusing on the freight they ship best. Remote deliveries and oversize packages are not as efficient or lucrative. They can’t afford to absorb those costs and are now passing them back to shippers like you.

But don’t panic just yet – we’ve got some strategies to help you manage shipping costs in 2023.

Here’s a breakdown of the 2023 FedEx and UPS carrier rate changes

 

2023 FedEx DAS Remote Charge Explained

Delivery Area Surcharge (DAS) is applied to pickups and deliveries outside a carrier’s standard shipping area, typically in rural or remote locations. This charge is based on the zip code and the address.

Effective January 30, 2023, FedEx added a Contiguous U.S. Remote DAS that will apply to select ZIP codes in the contiguous United States.

FedEx's 2023 DAS Remote Charge
$13.25 for Ground and Express shipments.

  • FedEx’s new 2023 DAS Remote Charge is designed to cover the extra delivery costs to remote areas. If your package is headed to a zip code that’s far off the beaten path, you’ll be hit with an additional fee of $13.25 for Ground and Express shipments.
  • This new FedEx accessorial fee will impact 3,833 designated zip codes.

To make things more complicated, there are sub-category surcharges within the DAS, including the Extended Delivery Area Surcharge (EDAS), which applies to specific zip codes, and the Remote Area Surcharge, typically imposed on Hawaii and Alaska.

Good news. You have options to help curb DAS impact. For example, you can look into local carriers that wont charge as much for remote delivery. You can also ask FedEx for a discount if you come to the negotiating table prepped.

 

2023 FedEx Extended Peak Surcharge

The 2023 FedEx peak additional handling surcharge (AHS) & oversize charge has been extended beyond its usual January expiration until further notice.

2023 FedEx Extended Peak Surcharges
Additional Handling $3.45 per package
Oversize Charge $39.50 per package

If you’re a shipper that sends a lot of large or heavy packages, you’re going to feel the pain of these fees. Carriers are making it clear that unless your shipments are small and lightweight–they don’t want it. And they’re going to charge you extra for it.

The best way to minimize impact and meet carriers where they are is to optimize your packaging to reduce the size and weight of your shipments.

For a streamlined way to see which packages world best for their operations and carriers, utilize Logistics Intelligence tools like Package Modeling to identify levers your company can pull to optimize your operations and maximize savings. Play out as many different packaging scenarios as possible to find the best solutions for your business before you spend a dime.

FBA vs FBM

The #1 Logistics Intelligence Software

2023 UPS Demand Residential Charge

UPS’s new Demand Residential Charge will apply if you were billed for more than 20,000 packages during any week following October 2021.

If you fall into this shipping category, you’ll be hit with a charge ranging from $.40 to $.60 per package, depending on your volume above the June 2022 baseline.

2023 UPS Demand Residential Charge
$.40 if you are 105% above your June 2022 baseline volume
$.60 if you exceed 150% of your June 2022 baseline volume

See page 5 for further details

For a high-volume shipper, the pennies add up fast. But there are ways to mitigate its impact. For example, you can try consolidating your shipments to reduce the number of packages you send each week. You can also explore alternative carriers (regional and LTL) or negotiate with UPS for better rates based on your shipping volume.

The best way to know which option is best for your business is by having direct access and control of your shipping data.

 

Your Best Defense Against Rising FedEx and UPS Fees is By Becoming an Expert in Your Own Shipping Data

These carrier fee increases are no joke. And how you manage your shipping data to curb these fees directly reflects how powerful your leverage is in this market.

Remember, by taking the time to understand and compare these new FedEx and UPS fees, you can make data-grounded decisions about which carriers and services are best for your unique shipping operations, and that’s more than time and money saved; it’s longevity.

Arm your team with the tools they need to combat rising carrier fees and stay competitive in the market with AI-powered parcel tools like Sifted’s Logistics Intelligence Solutions.

Topics: FedEx, General Rate Increase, UPS

Check out related resources at Sifted.

Amazon Supply Chain Services: What Shippers Should Know

Amazon Supply Chain Services: What Shippers Should Know

On May 4, 2026, Amazon announced the launch of Amazon Supply Chain Services (ASCS), a single offering that bundles ...
Read More
Top 5 Reveel Alternatives for Parcel Spend & Auditing

Top 5 Reveel Alternatives for Parcel Spend & Auditing

The parcel spend and logistics intelligence market has more capable platforms than ever. But the right fit depends ...
Read More
Carrier Contract Optimization: How to Negotiate UPS and FedEx Rates with Confidence

Carrier Contract Optimization: How to Negotiate UPS and FedEx Rates with Confidence

Every year, parcel carriers announce their General Rate Increases. And every year, shipping costs climb. And yet, ...
Read More
Meet Sifted at Home Delivery World 2026—Booth #617

Meet Sifted at Home Delivery World 2026—Booth #617

We're excited to be exhibiting at Home Delivery World 2026, one of the most important gatherings for last-mile ...
Read More
Carrier Billing Errors: How Shippers Get Overcharged

Carrier Billing Errors: How Shippers Get Overcharged

Every shipment that leaves your dock generates an invoice. And somewhere in that invoice—possibly more than ...
Read More
How to Reduce Parcel Shipping Costs

How to Reduce Parcel Shipping Costs

UPS and FedEx each announced a 5.9% average General Rate Increase for 2026, but analysts estimate that most ...
Read More
Best Parcel Audit Software in 2026: 8 Companies Compared

Best Parcel Audit Software in 2026: 8 Companies Compared

Parcel audit software catches carrier billing errors and service failures that silently drain your shipping ...
Read More
Parcel Spend Management: A Complete Guide

Parcel Spend Management: A Complete Guide

Parcel shipping is one of the largest, most complex line items on a company’s operating budget. For many ...
Read More
Parcel Refund Recovery: How to Claim What Your Carriers Owe You

Parcel Refund Recovery: How to Claim What Your Carriers Owe You

Every carrier invoice contains charges your organization paid that could be recovered. Misapplied Surcharges. Late ...
Read More
UPS Parcel Audit: How to Catch Billing Errors and Reduce Shipping Costs

UPS Parcel Audit: How to Catch Billing Errors and Reduce Shipping Costs

A UPS parcel audit is the systematic review of UPS invoices to catch incorrect charges, unapplied discounts, and ...
Read More
FedEx Audit: How to Find and Fix Billing Errors

FedEx Audit: How to Find and Fix Billing Errors

Every week, FedEx invoices land in logistics managers’ inboxes and most go unchallenged. But a closer look often ...
Read More
Parcel Audit: What It Is & Why You Need One

Parcel Audit: What It Is & Why You Need One

If your shipping costs keep climbing but you’re not sure why, a parcel audit is often the first solution to ...
Read More
No results found.

Profile Monitoring
Get always-on monitoring across cost-sensitive KPIs

Scenario Modeling
Test supply chain adjustments in a virtual sandbox

Carrier Management
Gain transparency into carrier performance and costs

Monitoring via Alerts
Stay ahead of every change in your parcel operation

Accounting Automation
Automate the manual and error prone processes

Reporting & Analytics
Centralize insights, visualize trends, and create reports

3PL Brand Management
Simplify and accelerate your pricing + billing workflows

SiftedAI Copilot
Have access to an always-on logistics analyst

Use Cases

For Finance Pros
Control shipping spend with automated intelligence

For Logistics Pros
Oversee shipping spend and performance across carriers

For Executives
Get clear visibility into parcel spend, risk and performance

For Retail
Control shipping cost and performance across carriers

For Manufacturing
Manage complex parcel spend with operational clarity

For Health & Life Sciences
Increase oversight into critical shipment performance

For 3PLs
Optimize margin and transparency across brands

For PE Firms
Analyze and act on parcel data to protect EBITDA

Blog
Discover news, tips, and industry best practices

DIM Weight Calculator
See how DIM impacts your shipping costs

Podcast
Hear from industry experts on LeaderShipping

Case Studies
Learn how other brands use
Logistics Intelligence

Carbon Calculator
Calculate CO2 emissions to reduce impact

Guides
Download free reports and
expert how-tos

Frequently Asked Questions
Explore top questions from shippers evaluating SiftedAI

Unboxed Newsletter
Subscribe for parcel news, predictions & tips

Logistics Intelligence
For parcel shippers

Let's get you to the right place!

SIFTEDAI
New & Improved Logistics Intelligence Platform

Not sure if you have an account? Email [email protected].