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All Things Shipping | Sep 25, 2020

FedEx to Raise Rates in January 2021—Here’s What to Expect

FedEx to Raise Rates in January 2021—Here’s What to Expect

This past week, FedEx announced that it will be increasing rates for its domestic, import, and international services, starting on January 4, 2021. We’re here to walk you through the upcoming changes so that you can plan ahead as early as possible.

To cut to the chase, what do these increases ultimately mean for e-commerce businesses? 

First and foremost: a 4.9% increase on average on FedEx Ground and FedEx Home Delivery services. But, there are other new developments as well, that we’ll list here for your reference. 

Rate Increases Across Service Levels

Here are some additional—and more specific updates—from FedEx, that will take effect on January 4, 2021:

  • An average increase of 4.9% on FedEx Express package and freight standard list rates for domestic, plus US export and import services
  • As mentioned above, an average increase of 4.9% on FedEx Ground and FedEx Home Delivery standard list rates 
  • Changes to FedEx One Rate Service Guide pricing
  • Changes to overall FedEx Retail Rates

Rates will also increase on the following services:

  • FedEx SmartPost
  • FedEx Ground Multiweight
  • FedEx International Premium

Plus, there will be an increase in minimum rate levels for FedEx Express services. 

Late Fee Policy 

On top of the annual rate increases listed above, FedEx will also apply a 6% late fee on FedEx Ground and U.S. FedEx users who don’t comply with their agreed-upon terms. This will also take effect in January 2021. To account for these fees, the company notes: “This aligns us with general business and industry standards and allows us to provide the best service possible for our customers.” 

Changes to Existing Surcharges

Additional surcharges and updates will take effect on January 18, 2021, and will include:

  • Changes to how “Additional Handling Surcharges” will be calculated on FedEx Ground and FedEx Express services. The following will be added to the existing criteria:
    • Surcharges will apply to any packages that are larger than 105 inches in length and girth
  • International Out-of-Delivery-Area or Out-of-Pickup-Area surcharges for FedEx International Express Freight will be levied in certain U.S. locations
    • This basically means that there will be extra surcharges on deliveries or pickups to and from less-accessible international locations, based on the zip code of the delivery or pickup location
  • A High Cost Service Area Surcharge on FedEx Freight shipments
  • View a full list of specific FedEx rates and increases

Looking ahead to 2021, FedEx remains an important part of any shipping mix and a strong option for e-commerce businesses, especially for its tracking capabilities and time-sensitive shipment services. 

 

Explore Shippo to help streamline your shipping operations and manage your shipping budgets for 2021. 

 

Jim Kazliner is Shippo's Content Lead and Editor-in-Chief. His background spans business, retail, financial, and automotive sectors, as well as music and film journalism. When not spinning yarns on his long-suffering laptop, you’ll find him collecting vintage vinyl and obscure BMX bike parts.

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