In advance of the 2014 General Price Increase, FedEx Express has announced a 3.9% average increase for US Domestic, US Export and US Import services, effective January 6, 2014.  The FedEx Ground, FedEx Home Delivery and FedEx Smartpost increase will be announced in 4^th quarter of this year.  FedEx Freight has already imposed a 4.5% general rate increase, which took effect July 1, 2013. FedEx also announced 7% growth (year-over-year) for the 1st quarter 2013, reflecting improved operating margins and revenue growth.

Express surcharges, which are not included in the 3.9% average, will be increasing by 7.6% (average) in 2014.  Notable surcharge increases include the following:

• Declared Value: Increase of $0.05 (5.9%) to $0.90 per $100 in value with a minimum charge increase of $0.15 (5.9%) to $2.70


• Delivery Area Surcharge Commercial (including Extended): Increase of $0.10 (4.7%) from $2.15 to $2.25


• Delivery Area Surcharge Residential: Increase of $0.15 (4.6%) from $3.25 to $3.40


• Delivery Area Surcharge Residential Extended: Increase of $0.15 (4.3%) from $3.50 to $3.65


• Delivery Area Surcharge Multiweight (Commercial & Residential): Increase of $0.50 (4.7%) from $10.75 to $11.25


• Residential Delivery: Increase of $0.15 (4.7%) from $3.20 to $3.35


• Saturday Pickup & Delivery: Increasing $1.00 (6.7%) from $15.00 to $16.00

So, how does this affect you?  The 3.9% Express increase is only an average…the impact to you WILL differ.  The solution and strategy to minimize the effects of this increase will vary according to service level usage, zone density, package characteristics and distribution model.  If you would like to discuss strategies to mitigate these rate increases, specific to your organization, please contact Source Consulting.

More to come in the near future as the carriers continue to release information related to the upcoming price increase.