Christmas in…September? FedEx is making fast moves this year with their early Peak Season release. Some charges coming as early as next month!
It’s anything but standard. FedEx has two Peak Season waves, with much to unpack. UPS is getting serious with their increases, some up 60% from last year. And USPS is trailing close behind. PLUS, Amazon has entered the mix! And they’re here to stay. If you want to end Q4 with a bang, here’s everything you need to know about these surcharges.
UPS 2022 Peak Season Rates
[October 2nd, 2022 – January 14th, 2023]
Full video breakdown here:
Additional Handling
UPS is raising their current $3.50 additional handling fee to $6.50. (An 8% increase from last year. $3.50 during the 2021 peak season)
A surcharge applied when a package exceeds certain weight or dimensional limits or the packaging consists of anything other than a squared cardboard box and requires additional handling:
- Greater than 50 pounds
- More than 48” on the longest side or more than 30” on the second-longest side
- Encased or bound with metal, wood, plastic, cloth, etc.
- Cylindrical or round in shape
Large Packages
UPS: $70.00 fee per large package. (An 16% increase from last year. $60 during the 2021 peak season)
A surcharge is applied for large packages if the length plus girth [(width x 2) + (height x2)] combined exceeds 103 to 165 inches or the package length is 96 to 108 inches.
Over Maximum Limits
UPS: $400.00 fee per package over maximum limits. 60% increase from 2021’s peak season.
A surcharge applied to Over Maximum packages with an actual weight of more than 150 pounds. Shipments exceeding 108 inches or a total of 165 inches in Length + (2 x Width) + (2 x Height) combined are not accepted for transportation
Residential Surcharges – UPS
Both carriers are keeping on with the approach to measure shippers’ volumes and charge based on their peaking factor tiers. UPS peak surcharges will apply to customers who shipped over 20,000 packages during any week following October 2021.
And they’ve added one more tier. Making a total of 6.
Last year the shipping threshold was 25,000 packages. This slight change will affect MANY more shippers.
UPS will be implementing these increases effective October 30th, 2021, through January 14th, 2022:
| Peaking Factor (based on your delivery volume) | >105% to 125% of Oct. 2021 Volume | >125% -150% of Oct. 2021 Volume | >150% -200% of Oct. 2021 Volume | >200% -300% of Oct. 2021 Volume | >300% -400% of Oct. 2021 Volume | >400% of Oct. 2021 Volume |
|---|---|---|---|---|---|---|
| UPS SurePost | $1.25 | $1.75 | $2.00 | $2.50 | $4.25 | $6.00 |
| UPS Ground | $1.25 | $1.75 | $2.00 | $2.50 | $4.25 | $6.00 |
| UPS Next Day Air | $2.25 | $2.75 | $3.00 | $3.50 | $5.25 | $7.00 |
| All Other UPS Air Residential | $2.25 | $2.75 | $3.00 | $3.50 | $5.25 | $7.00 |
FedEx 2022 Peak Season Rates
Wave #1 [ Sept 5th, 2022 – Oct 2nd, 2022]
Wave #2 [ Oct 3rd, 2022 – Jan 15th, 2023]
FedEx Video Breakdown:
| Surcharge name | Applicable Services | Surcharge Amount | Effective Date |
|---|---|---|---|
| Peak — Additional Handling Surcharge | U.S. Express Package Services, U.S. Ground Services, International Ground Service | $3.45 per package $6.55 per package | 9/5/22-10/2/22 10/3/22-1/15/23 |
| Peak — Oversize Charge | U.S. Express Package Services, U.S. Ground Services, International Ground Service | $39.50 per package $68.75 per package | 9/5/22-10/2/22 10/3/22-1/15/23 |
| Peak — Ground Unauthorized Package Charge | U.S. Ground Services, International Ground Service | $385.00 per package | 10/3/22-1/15/23 |
| Peak Surcharge | FedEx Ground® Economy Package Services | $1.50 per package $2.50 per package $1.50 per package | 10/31/22-11/27/22 11/28/22–12/11/22 12/12/22–1/15/23 |
| Peak — Residential Delivery Charge | FedEx Express and FedEx Ground U.S. domestic residential packages (excluding FedEx Ground Economy and FedEx One Rate® packages). | See Peaking Factor Chart below | 10/31/22-1/15/23 |
FedEx Peak Season Wave #1 [ Sept 5th, 2022 – Oct 2nd, 2022]
This is a “mini peak season” from FedEx before the increases really hike up.
Additional Handling
Starting September 5th, 2022, FedEx is raising its additional handling fee to $3.45, set to stand until October 2nd, 2022.
Oversized Packages
An oversize charge applies to packages that exceed 96 inches in length or 130 inches in length and girth. $39.50 per package from September 5th, 2022 to October 2nd, 2022
FedEx Peak Season Wave #2 [ Oct 3rd, 2022 – Jan 15th, 2023]
Additional Handling
Big increase here from FedEx. $6.55 per package – a 10.1% increase from 2021’s $5.95 rate.
Oversized Packages
At $68.75 per package, oversized fees have also increased 10% from 2021’s $62.50 rate.
Unauthorized Parcels
Parcels that do not meet the strict requirements for both length and weight (as outlined below) will be subjected to the “over max limits” or “unauthorized parcel” fee, and it’s pretty steep. We’re talking $380 per package if it’s going through FedEx!
That’s a 10% increase from 2021. ($350.00 during 2021 peak season)
FedEx: Defines “Unauthorized Parcels” as
- Any shipment measuring more than 108 inches in length.
- A shipment measuring more than 165 inches in length and girth combined.
- Any parcel weighing more than 150 lbs.
FedEx Ground Economy Surcharges
If you’re using this contract service, FedEx decreased slightly from last year in one of their phases. These apply to all who use this service, regardless of shipping volume.
| Surcharge Amount | Effective Date |
|---|---|
| $1.50 per package | Oct. 31, 2022 - Nov. 27, 2022 |
| $2.50 per package | Nov. 28, 2022 - Dec. 11, 2022 |
| $1.50 per package | Dec. 12, 2022 - Jan. 15, 2023 |
Residential Delivery
Just like last year, things are getting a bit technical with residential increases. They still depend on how many packages you send weekly to dictate how much of an increase you get for the following week.
FedEx has also lowered the threshold, affecting more people.
If you’re like many shippers who ship more than 20,000 weekly (on average) residential, economy, express, or any ground services—you will be hit with an additional residential delivery charge.
How do they calculate that?
They average your volume from June 6, 2022, to July 3, 2022, and then multiply by 100 to figure out how many packages you sent out during that time.
Then they use that calculation to determine your peak season charges.
So if you’re a seasonal shipper, this is really going to hit home and create a heavy surcharge burden.
| Peak — Residential Delivery Charge per Package by Peaking Factor | ||||||
|---|---|---|---|---|---|---|
| >105%–125% | >125%–150% | >150%–200% | >200%–300% | >300%–400% | >400% | |
| FedEx Ground® | $1.25 | $1.75 | $2.00 | $2.50 | $4.25 | $6.00 |
| FedEx Express® | $2.25 | $2.75 | $3.00 | $3.50 | $5.25 | $7.00 |
Listen in on an expert take. Here’s a video breakdown with Sifted’s VP of Data Insights, Kevin Miller.
USPS – Surcharges
Postal officials say the peak season surcharges are necessary to keep rates competitive and offset the demand and volume that come with the holiday quarter. USPS rate increases will begin October 2, 2022 and will remain until January 22, 2023.
Increases will be zone-based for Priority Mail and Priority Mail Express:
- Commercial Increases:
- $0.75 increase for Priority Mail, Priority Mail Express Flat Rate Boxes, and Envelopes
- $0.25 increase for Zones 1-4, 0-10 lbs.
- $0.80 increase for Zones 5-9, 0-10 lbs.
- $0.75 increase for Zones 1-4, 11-25 lbs.
- $2.80 increase for Zones 5-9, 11-25 lbs.
- $3.00 increase for Zones 1-4, 26-70 lbs.
- $6.50 increase for Zones 5-9, 26-70 lbs.
- Retail Increases:
- $0.95 increase for PM and PME Flat Rate Boxes and Envelopes.
- $0.30 increase for Zones 1-4, 0-10 lbs.
- $1.00 increase for Zones 5-9, 0-10 lbs.
- $0.95 increase for Zones 1-4, 11-25 lbs.
- $3.20 increase for Zones 5-9, 11-25 lbs.
- $3.25 increase for Zones 1-4, 26-70 lbs.
- $6.45 increase for Zones 5-9, 26-70 lbs.
Increases will be zone-based for First-Class Package Service, Parcel Select Ground, and USPS Retail Ground:
- Commercial Increases:
- $0.25 increase for Zones 1-4, 0-10 lbs.
- $0.40 increase for Zones 5-9, 0-10 lbs.
- $0.75 increase for Zones 1-4, 11-25 lbs.
- $1.60 increase for Zones 5-9, 11-25 lbs.
- $3.00 increase for Zones 1-4, 26-70 lbs.
- $5.50 increase for Zones 5-9, 26-70 lbs.
- Retail Increases:
- $0.30 increase for Zones 1-4, 0-10 lbs.
- $0.60 increase for Zones 5-9, 0-10 lbs.
- $0.95 increase for Zones 1-4, 11-25 lbs.
- $2.70 increase for Zones 5-9, 11-25 lbs.
- $3.25 increase for Zones 1-4, 26-70 lbs.
- $5.85 increase for Zones 5-9, 26-70 lbs.
| Product | Current | Planned Increase |
|---|---|---|
| Parcel Select Destination Delivery Unit (DDU) | Starts at $3.50 | $0.25 |
| Parcel Select DSCF | Starts at $.377 | $0.75 |
| Parcel Select DNDC | Starts at $4.84 | $0.75 |
| USPS Connect Local | Starts at $3.95 | No change |
| Parcel Select Lightweight (DDU) | Starts at $2.32 | No change |
| Parcel Select Lightweight (DSCF and DNDC) | Starts at $2.72 | No change |
| Parcel Return Service | Starts at $3.37 | No change |
Amazon Peak Season Surcharges
It finally happened, Amazon has announced their own peak season surcharges for shippers this year, and they plan to make it a permanent staple.
From October 15, 2022 to January 14, 2023 expect a holiday peak fulfillment fee averaging $0.35 per item if it’s going through FBA (Fulfillment by Amazon).
Here’s what you can expect for Amazon fee increases for Peak Season
| Size Tier | Shipping Weight | Before 10/15/22 | 10/15/22 - 1/14/22 |
|---|---|---|---|
| Small standard | 6 oz or less | $3.07 | $3.28 |
| Small standard | 12-16 oz | $3.77 | $3.98 |
| Large standard | 2-3 lbs | $6.08 | $6.60 |
| Large standard | 3-20 lbs | $6.44 + $0.32/lb above first 3 lbs | $6.96 + $0.32/lb above first 3 lbs |
The Choice is Yours
Navigating these carrier surcharges to assess what works best for your business’s needs will be challenging and time-consuming. But with logistics intelligence, you can bypass the complexities of peak season and identify opportunities across all carriers.
Win Big This Peak Season and Beyond
Take Advantage of Technology to Crush Peak Season Costs
By unifying your systems, understanding your data, and automating your processes, you can optimize your shipping and gain supply chain visibility. That’s where Sifted can help, and we have an all-in-one platform to get you feeling more empowered with your shipping strategy.
Try a free demo today to dig into your data and check out our Peak Season Checklist to get your ship in order before peak…there’s not much time left.
