Economic Slump and Higher Shipping Costs


March 25, 2011


Shipping companies like UPS and FedEx are caught between a "rock and a hard place."  The rock is ever-rising fuel prices, which some economists say will top $4 per gallon for diesel and gas.  The "hard place" is eating that cost or passing it on to clients and customers who are themselves fighting a prolonged recession. Sure, UPS and FedEx can add surcharges to cover fuel costs--but their customers can also elect to give them fewer shipping orders and that eats into revenue. Depending on your carrier preference there are tools available to help determine the cost of shipping a package: FedEx rate calculator or UPS rate calculator.

Recently, UPS raised prices. To determine UPS shipping costs for a given package, try the UPS rate calculator on their website. Note that large packages, particularly those shipped via air services, may rise due to their dimensional weight calculations. Packages over a "combined" 88 inches are oversized and placed in the 30-pound category. Those over 108 inches are "double oversized" and fall into the 70-pound category. You'll pay a premium for long packages too. Use the FedEx rate calculator to compare prices.

FedEx recently announced a 5.9 percent increase in their Ground service rates with a one percent reduction to their fuel surcharge. In addition, their Air Express and US Export rates rose by 5.9 percent with a two percent reduction in their fuel surcharge. To determine your shipping costs for a given package, try the FedEx rate calculator on their website.

Rates for UPS Air and International shipments, as well as their Ground commercial rose 4.9 percent. In general, fuel surcharges for UPS and FedEx are not unreasonable, but you can expect to pay extra for "loose" items. Again, use the UPS rate calculator to determine exact rates.

Hopefully, fuel prices will drop and the economy will pick up. Until then, you'll have to weather this perfect storm of high fuel prices and bad economy.

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