Accessorials: How They Affect Your Shipping Costs

If you’re looking for a way to boost your online sales, offering low-cost shipping rates is a great place to start. In 2022 alone, 48% of shoppers reported that extra costs, like shipping, caused them to abandon their cart.

In addition to standard shipping costs, it's important to understand freight accessorial fees—these are additional charges for extra services during freight shipping. Knowing about these fees upfront helps you manage shipping costs and avoid surprises.

While finding competitive shipping rates can help combat this problem, it’s also vital to consider how extra costs like accessorial charges impact the overall cost of shipping. By understanding what these shipping fees are and where they come from, you can more effectively control the cost you’ll pass along to your customers. This knowledge will also help you to create and carry out strategies to save money on accessorial fees.

If shippers are not proactive, unexpected accessorial charges can arise during the shipping process, making it crucial to plan ahead and ensure cost transparency.

Let’s look at what accessorial charges are, why they are applied, and what you can do to minimize their impact on your business.

Introduction to Freight Shipping

Freight shipping is the backbone of supply chains, moving goods in bulk from one location to another using trucks, trains, ships, or planes. Unlike standard parcel shipping, freight shipping involves larger shipments, more complex logistics, and a variety of services tailored to the needs of both the shipper and the receiver. One of the most important aspects to understand in freight shipping is accessorial charges—additional fees that carriers apply for services beyond the standard pickup and delivery. These accessorial charges can significantly affect your shipping costs, especially if your shipments require special handling, delivery to unique locations, or extra services. By familiarizing yourself with the types of fees carriers may charge, you can better plan your shipments, avoid unnecessary costs, and ensure your goods are delivered efficiently and on budget.

What Are Accessorial Charges?

Accessorial charges, also called value-added services, are extra shipping costs applied to freight and parcel shipments. An accessorial fee is an additional charge that arises due to specific circumstances, such as administrative issues, delivery challenges, or the need for reclassification and reweighing of shipments. Typically, these charges are added to cover the cost of extra time, labor, or care required to honor special shipping requests.

Accessorial fees vary based on the type of shipment. Carriers charge accessorial fees for services that go beyond standard shipping, such as delivery challenges in congested urban areas or administrative issues. For example, accessorial charges for a freight shipment might include inside delivery or liftgate service needed for larger packages. Since parcel deliveries are smaller, accessorial charges cover things like address correction, fuel/residential surcharges, and signature on delivery.

Some accessorials are charged as a flat fee for specialized services, while others may be based on time or other factors.

Common Types of Accessorial Charges When Shipping Parcels

Even though accessorial charges increase the cost of shipping, it enables entrepreneurs like you to make a positive impact on the customer experience. That’s because these value-added services make it possible to ship packages exactly the way your customer desires. For example, an added fee is often imposed for residential deliveries due to the extra labor and time required by carriers. Delivering to a residential area can present unique challenges and may lead to higher charges compared to commercial locations.

Let’s take a look at the most common types of accessorial charges and when they apply.

Address Correction

When a destination address doesn't reflect what a carrier's system says it should be, address correction shipping surcharges apply. These fees, which costs around $20, ensure parcels reach the correct address. Shippo's software can verify the address before handing off to the carrier.

Additional Handling

Additional fees apply to parcels requiring special handling due to things like a package's heavy weight, fragile items inside the package, or custom packaging. Depending on the reason, costs range anywhere from around $18 to $40.

Collect on Delivery (C.O.D.)

If payment for a parcel must be collected upon delivery of a parcel, a C.O.D. charge applies. This option, which gives customers the ability to pay via cash or check for their items, costs about $18 depending on the carrier.

Chargeback for Consignee Billing Shipments

Some shipments are set up in such a way that the consignee, or the person receiving the package, is responsible for paying the shipping fees associated with it. If a package is shipped to an unauthorized consignee or if the consignee refuses to pay the associated fees, a chargeback surcharge is billed to the shipper in the amount of about $20.

Delivery Confirmation Signature Required

A delivery confirmation signature allows shippers to provide proof that a package was delivered and received by a specific individual at the destination. This service carries a surcharge of approximately $6.

Delivery Confirmation Adult Signature Required

When an adult's signature is required before delivery can take place, it entails an accessorial charge of $7.65.

Dangerous Goods (Hazardous Materials)

Shipping hazardous materials requires special handling to protect the health and well-being of carriers and customers alike. This service typically ranges from $35 to $145.

Dry Ice

Shipping perishable items requires taking special precautions against spoiling, such as using dry ice. This shipping surcharge runs at around $7.

Delivery Area Surcharge

When a parcel's destination falls outside of a carrier's typical delivery area, extra shipping surcharges apply. The cost of these fees depends on the type of delivery service being used and can cost up to $7.15 with UPS.

Delivery Intercept

If a parcel must be stopped or redirected mid-journey, a delivery intercept charge is applied. This fee, which can cost up to $20, is only applied if the intercept is successful.

Fuel Surcharge

When gas prices rise above a certain, pre-determined price, delivery companies apply an additional fuel surcharge to mitigate the impact on their profits. This fee depends on the difference between the ceiling price and the cost of fuel and is typically charged by the gallon. With Shippo, you won't have to worry about this charge for USPS, UPS, and certain FedEx shipments.

Large Package Surcharge

When a package exceeds certain dimensions, special handling is required, which incurs a large package surcharge. This fee, which is determined based on the size of the package, can cost up to $200.

Missing/Invalid Account Number or Refusal Fee

Most carriers allow shippers to bill shipping charges to an account holder's account number. If the account number provided is invalid or the consignee refuses a package, an extra fee applies, up to $19.50.

Over Maximum Limits

When a parcel's weight or dimensions falls outside of a carrier's predetermined maximum limits, carriers will charge an additional fee which can be substantial. For USPS, weight limits can't exceed 70 lbs while UPS's limit is 150 lbs. The maximum size for UPS shipments is also larger, being 108 inches in length or 165 inches in length plus girth.

Package Pickup

A package pickup fee is assessed when a shipper opts to have a carrier pick up parcels rather than drop them off. This charge typically costs as little as $2. With Shippo, you can schedule to have USPS reps pick up your packages for free.

Rebill Fee

When freight charges change after a package has been received by the carrier, a rebill fee is often assessed. This most commonly happens when a package is different from what was quoted, but it can also occur if a quote expires or a price change goes into effect.

Remote Area Surcharge

Remote area shipping surcharges apply to shipments that fall outside of a certain range from a carrier's hub. These fees cover the extra time and fuel that is required to deliver to such areas and usually cost between $13 and $38.

Residential Surcharge

Residential surcharges are accessorial charges applied to shipments going to addresses deemed as residential by the carrier. The cost is around $5.25. Carriers such as USPS don't enforce this as an accessorial charge. UPS shipments with Shippo are also not affected by this.

Shipping to an Access Point or Parcel Locker

Shipping to a partnered retail location of the carrier allows customers the flexibility to pick up their packages from a safe location on their own schedule. UPS does not charge extra fees for shipping to these Access Points, though other carriers may charge a fee for the convenience.

Freight Accessorial Charges

Freight accessorial charges are extra fees that carriers add to your bill when your shipment requires services beyond the basic transportation from point A to point B. These freight accessorial charges can include a wide range of additional services, such as liftgate service for heavy items, inside delivery when goods need to be brought beyond the loading dock, or residential delivery to a home or non-commercial address. Administrative accessorial fees may be charged for special paperwork or handling instructions, while equipment fees apply when specialized equipment like pallet jacks or liftgates are needed. Delivery-related accessorials cover services such as limited access delivery, construction site delivery, or multiple deliveries to different locations. Since these fees can quickly add up and impact your total cost, it’s crucial for shippers to review shipment details carefully, communicate with carriers about any special requirements, and avoid unnecessary charges by planning ahead. Understanding the different types of freight accessorials and when they apply helps you make informed decisions, control costs, and streamline your shipping process.

Freight Class and Accessorial Charges

Freight class is a key factor in determining both your base shipping rate and the likelihood of incurring accessorial charges. Each shipment is assigned a freight class based on its density, stowability, handling, and liability, which helps carriers assess the risk and resources required for transport. Higher freight classes often indicate bulkier, lighter, or more difficult-to-handle items, which can lead to additional fees for specialized equipment or extra care during transit. For example, a shipment with a high freight class may require a specialized trailer, extra labor, or special handling, all of which can result in added accessorial charges. By understanding your shipment’s freight class and how it affects both the base rate and potential additional fees, shippers can more accurately estimate total shipping costs, select the right carrier, and avoid surprise charges related to equipment or handling.

Driver Assist and Accessorial Charges

Driver assist is a specialized service where the carrier’s driver helps load or unload your shipment, going beyond the standard curbside or dock delivery. While this service can be essential for shipments that are too heavy or cumbersome for your team to handle alone, it often comes with accessorial charges for the extra labor or equipment required. These fees can vary depending on the level of assistance needed and the carrier’s policies. To avoid surprise charges, it’s important for shippers to clearly communicate their requirements to the carrier in advance and to understand exactly what is included in the quoted price. Negotiating accessorial charges for driver assist and ensuring a clear understanding of the costs involved can help you manage your shipping budget and prevent unexpected fees from impacting your bottom line.

Advance Notification and Shipping

Advance notification is an important part of the shipping process, especially when dealing with freight shipments that require special arrangements at the pickup or delivery destination. Carriers may charge additional fees for advance notification services, such as scheduling delivery appointments, providing updates, or following special instructions. These accessorial charges are designed to compensate carriers for the extra time and coordination involved. To avoid unnecessary or surprise charges, shippers should plan ahead, provide clear and detailed instructions to their carrier, and confirm whether advance notification is required for their shipment. Proper advance notification can also help prevent detention fees, which are charged when a carrier is delayed at a facility due to lack of preparedness. By understanding how advance notification impacts shipping costs and accessorial fees, shippers can streamline their supply chain, avoid delays, and keep freight costs under control.

Who Pays for Accessorial Charges?

The person responsible for paying for accessorial charges depends on your business model. For example, you can opt to pass the price of these shipping surcharges on to the customer after delivery. However, many businesses instead opt to pay for these charges at the time of buying a label in order to give customers the best post-purchase experience possible.

Clear documentation and standardized accessorial charges can help the accounting team streamline freight audit and payment processes, reducing discrepancies and minimizing administrative queries.

How to Save Money on Accessorial Fees

The best way to save money on accessorial fees is to be mindful of how you’re shipping parcels. Simple practices such as measuring boxes correctly and double-checking addresses, for example, can eliminate them entirely.

However, some accessorial charges can’t be avoided. That’s why it’s essential to create other strategies to lessen their impact on your store. If you ship high volumes or have long-term relationships with carriers, you may be able to negotiate accessorial charges for more favorable shipping terms.

You also have the option of baking the cost of accessorial charges into the cost of your products. This is a common practice among e-commerce store owners since it makes shipping costs easier to swallow for customers. By accounting for shipping surcharges and including them in product prices, you can protect your profits from being absorbed by unexpected fees. Working closely with a freight provider can also help coordinate load planning and detention procedures, reducing the risk of unnecessary accessorial charges.

The ultimate way to reduce the impact of accessorial fees on your business is by using Shippo. With our platform, you can avoid fuel and residential surcharges, get automated address confirmation, take advantage of free pickups via the postal service, and enjoy discounts on shipping rates from the nations top carriers!

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