FedEx Announces 2015 General Rate Increase
This is the first time FedEx has announced its Ground increase prior to UPS. In the past, UPS would set the Ground increase and FedEx would quickly match it. The industry now turns its attention to UPS in anticipation of its 2015 GRI announcement in the coming weeks. Does UPS match the FedEx rate increases, or will it change pricing to compete with new, sharply discounted USPS Priority Mail pricing?
It's also noteworthy that FedEx Freight (LTL), which historically has taken its rate increase in April, will implement its rate increase in January to coincide with the rest of the FedEx product portfolio. Of course, exercising the increase three months earlier lends tremendous financial benefit to FedEx by shifting millions of dollars away from shippers earlier in the year.
Accessorial charges are also increasing (partial list): Additional Handling Service (5.9 precent), Address Correction (4 percent), Advancement Fee (7.7 percent), Declared Value (5.5 percent), Delivery Area Surcharges (4.1 percent to 14.3 percent), COD (4 percent), Delivery Signature Options (6.6 percent to 16.6 percent), Oversize Charge (4.5 percent), Residential Delivery Charge (4.5 percent to 6.9 percent).
Shippers interested in determining the exact impact of these rate increases for their unique distribution should contact me at firstname.lastname@example.org.
Rob Martinez is the CEO of Shipware LLC, a professional services firm that transforms businesses through intelligent distribution solutions and strategies. Rob has helped some of the world’s most recognizable brands reduce parcel shipping costs an average of 25 percent through contract negotiations, rate benchmarking, modal optimization, invoice audit and other savings vehicles. A cum laude graduate of UCLA, Rob has 20 years of transportation industry experience, including executive positions at DHL and Stamps.com, in addition to his work as an outside consultant since 2001.