Make Peak Season Less Painful with These Cost Avoidance Strategies

Peak season surcharges began in 2017 as a way for carriers to mitigate some of the costs during the heavy shipping season. Packages that require extra handling (i.e. additional handling, large package/oversize, and over maximum limits/unauthorized package) that get pushed into the carriers’ network create less efficiency; therefore, carriers seem to penalize shippers even more during the holiday season.
This article was originally published by PARCEL Media on December 3, 2019.

Peak season surcharges began in 2017 as a way for carriers to mitigate some of the costs during the heavy shipping season. Packages that require extra handling (i.e. additional handling, large package/oversize and over maximum limits/unauthorized package) that get pushed into the carriers’ network creates less efficiency, therefore carriers seem to penalize shippers even more during the holiday season. Fortunately for shippers, both FedEx and UPS have announced there will be no additional residential peak surcharges this year; however, there are still three surcharges to keep in mind this peak season – peak additional handling, peak large package or oversize, and peak over maximum limits or unauthorized package. These charges are in addition to the original surcharges and range anywhere from an additional $3.60 to $435.00 per package. Below are some tips to help make peak season less painful, specifically as it pertains to peak season surcharges.

Shippers should always plan for annual cost increases, but there are ways to mitigate these effects. Let’s categorize the price of packages into five elements: contract, service/mode, zone, weight, and accessorial surcharges. Shippers should evaluate optimization opportunities with these five elements:

Overall there are several different ways to avoid or reduce peak season surcharges. This list is not exhaustive but hits on a handful of ways to make the extra cost less painful. Overall, it’s important to budget for additional peak cost (even when it may be uncertain), to creatively look for ways to save via alternative package delivery to customers, and ultimately see if peak season surcharges can be reduced or waived via straight negotiation with carriers.