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How to Lower Delivery Area Surcharges

Jun 9, 2022

9 min read

What are delivery area surcharges (DAS)?

When you ship to “less-populated” or rural areas, carriers charge additional fees on top of the regular cost of the shipment to pick up or deliver your packages. These extra fees called ‘delivery area surcharges’ (DAS) offset the carrier’s cost for the extra miles on a truck to remote or less-accessible areas.

Residential area surcharges are also applied for deliveries to residential areas.

Shipping carriers also charge extended delivery area surcharges (EDAS) and remote area surcharges when your shipment is picked up or delivered to very inaccessible locations.

Every year shipping carriers revise their shipping rates, calling it a “General Rate Increase” (GRI) or “General Price Increase” (GPI).

Both FedEx (FedEx Express and FedEx Ground) and UPS (UPS Air and UPS Ground) have raised their shipping rates by 5.9% for 2022. Similarly, both carriers have also increased surcharges including their additional handling surcharges, oversized/large package surcharges, and DAS fees.

To learn more about the increase in UPS and FedEx delivery area surcharges and how to avoid paying, here’s a full breakdown.

How much do UPS delivery area surcharges cost?

Effective December 27, 2021, the Delivery Area Surcharge UPS service rates are found below.

Surcharge Name Applicable services 2021 Rate 2022 Rate
Delivery Area Surcharge Air Commercial $3.25 $3.55
  Air Commercial Extended $3.85 $4.25
  Ground Commercial $3.10 $3.40
  Ground Commercial Extended $3.70 $4.10
  Ground Residential $4.30 $4.80
  Ground Residential Extended $5.90 $6.50
  Air Residential $4.70 $5.20
  Air Residential Extended $5.90 $6.50

These charges can change based on various factors. For more information on delivery area surcharges, check UPS’s 2022 Rate & Service Guide.

UPS Additional Handling Price Increase

The additional handling charge is an extra fee for shipments that require special handling when being handled and shipped by the carrier.

Effective December 26, 2021, the Additional Handling Surcharge rates for UPS Ground and UPS Air are determined based on the shipment’s zone.

Surcharge Name Applicable Services 2021 Rate per package 2022 Rate per package
Delivery Area Surcharge

U.S. Express Package Services

(Residential)

$4.70 $5.20

U.S. Express Package Services,

U.S. Ground Services (Extended

Residential)

$5.90 $6.50

U.S. Express Package Services

(Commercial)

$3.25 $3.55

U.S. Express Package Services

(Extended Commercial)

$3.85 $4.25
FedEx Ground® (Residential) $4.40 $4.80
FedEx Ground® (Commercial) $3.10 $3.40

FedEx Ground (Extended

Commercial)

$3.70 $4.10

Express Alaska Package Services

(Residential, Commercial)

$31.50 $34.50

Express Hawaii Package Services

(Residential, Commercial)

$9.50 $11
Ground Alaska Package Services $31.50 $34.50
FedEx Home Delivery® (Residential) $4.30 $4.80
General Rate Increase 2022 Predictions

FedEx and UPS 2022 General Rate Increase (GRI)

Surcharge Name Applicable Services 2021 Rate per shipment 2022 Rate per shipment
Delivery Area Surcharge (continued) Maximum charge with FedEx Express

Multiweight Pricing (Residential,

Commercial, Extended Residential,

Extended Commercial)

Commercial $16.25 $17.75
Extended Commercial $19.25 $21.25
Residential $23.50 $26
Extended Residential $29.50 32.50
Maximum charge with FedEx Ground

Multiweight Pricing (Residential,

Extended Residential, Commercial,

Extended Commercial, FedEx Home

Delivery Residential, FedEx Home

Delivery Extended Residential)

Residential $22 $24
Commercial $15.50 $17
Extended Commercial $18.50 $20.50
FedEx Home Delivery Residential $21.50 $24
Extended Residential, FedEx Home Delivery Extended Residential $29.50 $32.50

Delivery area surcharges can change based on additional factors. For more information on delivery area surcharges, check out FedEx’s 2022 Surcharges & Fees Guide.

How to Reduce Delivery Area Surcharges

FedEx and UPS charge higher shipping rates for residential addresses called residential surcharges (around $4.00 to $5.00). This is an additional fee for home deliveries (including a business operating from a home). Carriers may also charge residential surcharges if they deem shipping to mixed-use buildings or farms to be a residential delivery.

One way you can avoid paying this fee is by adjusting it in your product pricing to absorb these additional charges. If that isn’t an option, you should consider switching to USPS when shipping to residential addresses. Unlike UPS and FedEx, USPS doesn’t charge residential surcharges.

Another way you can avoid paying delivery area surcharges is shipping to one of your locations if you have retail stores.

Eliminate delivery area surcharges by getting your customers to pick up their packages from access points and lockers near their location.

Try a regional carrier. Base prices of regional carriers may be higher. However, they often don’t include surcharges (such as residential and peak surcharges). In addition, they offer same-day or next-day delivery within their region.

Use a logistics intelligence tool to gain visibility into your supply chain and identify ways to reduce surcharges. It can help you audit your shipping fees, and even identify cases where you’re eligible for refunds. Carriers pay reimbursements for mistakes like misapplied delivery area surcharges and late deliveries.

Take hold of your shipping surcharges with Sifted

FedEx and UPS have announced a 5.9% increase in their shipping rates for 2022.

Knowing how these rate hikes will affect your eCommerce business’ shipping costs helps you make proper adjustments to your budget and minimize any negative impacts on your business.

Carrier shipping rates are negotiable (including DIM factors and surcharges), depending on factors such as a business’ growth forecasts. But by closely examining your shipping invoices, you can stay on top of any uncommon additional surcharges. A logistics intelligence tool like Sifted can help you accurately gauge shipping surcharges, and even contest or reduce surcharges by regularly monitoring your shipping fees.

Ready to optimize your shipping surcharges? Get a free demo from Sifted!

Topics: Additional Handling Surcharge
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