FEDEX AND UPS BOTH RAISING RATE: A RESPONSE TO MARKET CONDITIONS AND INFLATIONARY PRESSURE
Why? And what does this mean for businesses like yours?
Wait, What Rate Increases?
According to the UPS website, UPS’s Ground, Air, and International services will increase by an average of 6.9% starting Dec. 27.
On the same date, UPS will raise accessorial charges for residential deliveries, packages requiring extra handling, and remote deliveries.
And it’s not just UPS.
FedEx, UPS’s rival, announced a 6.9% average rate hike in September. The two logistics giants usually mirror each other’s rate spikes.
Why FedEx and UPS Are Raising Their Rates in Response to Market Conditions
Both companies are raising rates due to inflationary pressure.
Even though package volume has cooled off in recent quarters, both companies have raised their prices to offset losses caused by rising fuel costs and increasing labor expenses.
In fact, UPS stated, “This helps to support ongoing expansion and capability enhancements as we strive to maintain the high service levels you expect from UPS.”
As part of FedEx’s earnings call, FedEx EVP and Chief Customer Officer Brie Carere said inflationary pressures caused the company to hike rates.
What Can I Do for My Business?
Businesses can optimize their shipping costs with freight auditing and contract optimization.
How to Optimize Contracts for Efficient Operations
While you’re still in the negotiation stage, it’s critical to make sure you’re getting the most favorable deal possible before you sign a contract with a carrier.
The majority of companies lack the time, resources, or expertise to find the best deal. It can take years of experience to learn what carriers will offer.
If you are looking for contract optimization that will help you save money and make your operations more efficient, Navigo has the expertise and insider knowledge to find savings you may not even be aware of.
How Freight Auditing Can Save You Money
During the contract review phase with your carrier, the first step to reducing shipping costs is to audit the existing agreement and offer advice on what to request.
Freight auditing helps you secure any refunds that you are owed. But the process of claiming refunds is more complicated than it needs to be due to the fact that carriers make it difficult for you to do.
In a world where companies do not have time or resources to claim refunds, billions of dollars are left unclaimed every year. Luckily, we are dedicated to ensuring that you receive the savings you deserve.
Let the expert Navigo team show you how to secure the most competitive rates for FedEx, UPS, and other carriers to ease the pressure of inflation and keep your business running smoothly.
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