What to Expect from the Duopoly of FedEx & UPS General Rate Increase in 2023
As businesses of all sizes continue to scramble to find savings to offset the weight of these heavy annual increases, from FedEx and UPS, the major parcel carriers have again leveraged their duopoly of the industry and implemented widespread increases.
FedEx & UPS General Rate Increase in 2023
If you thought “unprecedented” described the increases we saw from the two major carriers in 2022, this year’s FedEx and UPS GRI will turn that perspective on its head.
As businesses of all sizes continue to scramble to find savings to offset the weight of these heavy annual increases, the major parcel carriers have again leveraged their duopoly of the industry and implemented widespread increases.
With this new round of changes to shipping costs, Reveel put together another expert team to create a guide and analyze the increased surcharges and rates so you can know exactly what to expect in 2023.
The Biggest Changes from Both Carriers
The GRI FedEx and UPS announcements came at the end of September and mid-October, with a variety of surcharge updates and their multi-page rate breakdown documents coming out shortly thereafter.
As with statements, PDFs, and interviews released each year, the true financial impact this would have on individual businesses wasn’t quite clear.
After our data scientists ran the numbers, we found the actual increase closer to:
- FedEx modeled an increase of 9.1%
- UPS modeled an increase of 10.2%
These jumps are a far cry from the announced 6.9% increase both carriers announced, so let’s take a look at some of the factors contributing to this discrepancy with both FedEx and UPS.
UPS 2023 General Rate Increase Highlights
Download: 2023 UPS® Rate & Service Guide Daily Rates (PDF)
The UPS GRI pricing went into effect on December 27, 2022–before the end of the new year–so it’s likely you’ve already seen its impact in your first 2023 shipping invoices.
While UPS Air experienced this same 6.9% increase back in 2012, this is the first in recent years that we’ll see this large of a rate increase to UPS Ground services.
While oversize packaging and additional handling are likely areas to see the largest service impact, there are a handful of glaring changes our team found will affect the majority of shippers most:
- Most of the familiar surcharges exceed the 6.9% UPS GRI announced, with some increasing 10-20% in some areas
- Peak surcharges are now named “Demand Surcharges” to reflect their new permanency
- Ground minimum packages charges will also increase by 7.9% with UPS
GRI FedEx 2023 General Rate Increase Highlights
Download: 2023 Changes to FedEx Express & FedEx Ground Surcharges & Fees (PDF)
We haven’t seen a 6.9% increase in any of the GRI FedEx has announced in the past ten years to either their air or ground service.
While this initial increase is by far the highest in recent memory, the new surcharge changes, like higher residential costs and heavier weight shipments of 50 lbs or more, will certainly contribute to much higher shipping costs across industries.
While businesses like home goods and auto parts providers can expect the heaviest increases, here are a few key points everyone is likely to experience this year:
- Many of the common surcharges increase greatly exceed the 6.9% GRI FedEx announced
- Packages delivered to certain zip codes will now warrant the new $13.25 remote surcharge
- Longer zones are set to see higher rate increases across the board
- Ground minimum package charges are set to increase by 7.9%
Reveel’s In-Depth FedEx & UPS 2023 GRI Analysis
As with their carrier contracts, it’s difficult to fully understand the UPS and FedEx rate changes through their literature and announcements.
That’s why, as with each year, the Reveel team digs through the data for you to create a comprehensive that discusses the reality of the new pricing and surcharges and breaks down who will see the most impact.
In this year’s guide, you’ll get details on:
- The actual modeled rate increase
- Which industries will be hit the hardest
- Rate increases on common surcharges
- The new peak season surcharge changes
- Methods for forecasting your costs with the higher rates
Download Your Free Guide: 2023 General Rate Increase Guide for FedEx & UPS Shipping
Once you know how the 2023 GRI of FedEx & UPS will affect your shipping costs, it’s time to put that data to work to help you find the savings you deserve.
Prepare for Rising Fees
There’s no getting around it - it’s a near guarantee that your business will be affected by these rate increases.
While it’s unfortunate that UPS and FedEx continue to prioritize profits above all else, there’s something you can do about it.
Don’t be caught off guard. Tap into Reveel’s Shipping Intelligence® platform to:
- Forecast how these changes will affect your shipping costs
- Audit your invoices to recoup any and all refunds
- Identify the fees you should negotiate to make the biggest impact on your bottom line
Sign up for the FREE version of the Shipping Intelligence platform.
At Reveel, our Shipping Intelligence Platform was built with A.I. technology and the goal to help companies ship smarter, no matter how much rates change in a given year. If you’re ready to recover the credits you’re owed, find areas to save, and negotiate better contracts, contact us to get started today.
The Reveel App uses AI and machine learning to provide an unparalleled look into what’s impacting your bottom line. Through invoice audits, peer benchmarking, and rate modeling/simulations, you can see the health of your operation and assess pricing changes from parcel carriers like FedEx and UPS. Sign up for a free Reveel account today to see how you can leverage automation to synthesize your data, ship more for less, and reduce the time needed to identify issues and action items.
Contact us to schedule.
Related Resources
2023 General Rate Increase Guide for FedEx & UPS Shipping
FedEx and UPS rate guides are notoriously difficult to decipher, so we’ve compiled the increases into an easy-to-use guide. Download Now!
3 Reasons to Actively Manage Your Shipping Agreement
In this ebook, we dig into why you should actively monitor your shipping agreement and see how a Shipping Intelligence Platform can help you solve them, we also explain the three key reasons you should stay on top of your shipping agreements. Download Now!
How Do You Measure Shipping Success
In this e-book, we take a deep dive into Reveel’s Shipping Intelligence® Platform™ to ensure you have a context understanding, and why Reveel has made it an easy-to-use platform for you to use. Download Now!
More Reveel Resources
Related Article: How to Save on Shipping Expenses by Renegotiating Your Shipping Agreement
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