FedEx recently announced its 2012 rate increase that will be effective Monday, January 2, 2012.  FedEx reported that on average (and that’s important) prices will increase 5.9%, but offset somewhat by a decrease of 2% in their fuel surcharge index.  I predict that UPS, between now and Christmas, will announce similar if not identical increases.  If I could only predict the stock market like that!

Just like LTL, parcel carriers announce an increase but the amount of increases supposedly reflects an average impact for an “average” shipper.  The actual increases are dependent upon the size of your shipments, the types of your shipment and the zones to which you ship.  For example, FedEx raised raised higher zone shipments for its express service approximately 7% and various surcharges increased 8-10%.

Also interesting is that for international shipments, certain countries were placed in different zones, effectively increasing those costs without a flat rate increase.  Here are some other examples of rate increases from FedEx.

• Additional handling charge increases $0.50 per package to $8.50 or 6.25%
• Commercial Delivery Area Surcharge increases 8.1% or $0.15 to $2.00 per carton
• Residential Extended Delivery Area Surcharge increases 8.3% or $0.25 to $3.25 per package
• Oversize charge will increase $5.00 to $55.00 (10%)
• Residential Delivery will increase 9.1% or $0.25 to $3.00 per package

If you are a small package, parcel shipper, you need to get copies of the new rates and charges and determine how your particular mix of shipments will be impacted.  It’s exactly like LTL>  You can’t expect that your impact will be the same as what they call an average shipper.

Finally, does it really matter that the additional charges all be round numbers?  Rather than increase residential delivery charge by $0.25, how about $0.18?  Or, how about raising the additional handling by $0.33 instead of $0.50.  It’s seems like FedEx and soon-to-be, UPS simply round up to make it an even number when most every shipper would rather see a lower percentage increase than having these surcharges be round numbers.