The parcel delivery industry is feeling the effects of today's volatile economic landscape. Concerns over tariffs that may spark a recession and trade war have businesses and consumers acting cautiously, leading FedEx to lower its full-year forecast for adjusted profit from $19-$20 to $18-$18.60.

How is the current state of the economy affecting the parcel industry? And how can you leverage the carriers' tough times for your benefit? Today, we're discussing why parcel is struggling and how you can lower your rates despite the uncertainty.

What's happening with FedEx?

FedEx's initial adjusted profit forecast for the fiscal year ending May 2025 was $20-$22. It lowered that number to $19-$20 in December and again this month. As a result of FedEx lowering its projections to the $18-$18.60 range, the carrier's shares dropped 11% on Friday, March 21— the lowest in nearly two years.

In a March 20 statement, Executive Vice President and Chief Financial Officer John Dietrich said, "Our revised earnings outlook reflects continued weakness and uncertainty in the U.S. industrial economy, which is constraining demand for our business-to-business services."

How does carrier behavior reflect the state of the economy?

A Reuters article says that FedEx and UPS "are viewed as barometers for the global economy due to their involvement across a swathe of industries." How the carriers are doing directly reflects how the world economy is faring. At the moment, it's not great.

Compressed peak season, wildfires, and winter storms affected deliveries and impacted the carriers' bottom lines. However, inflation, tariffs, and the threat of tariffs are driving uncertainties for all. Businesses are wary of spending in tumultuous times, and consumer demand has diminished over high import prices.

It's not all bad news, though. In the Q3 2025 FedEx Corp Earnings Call, Raj Subramaniam, President and Chief Executive Officer, said, "We navigated many headwinds in this third quarter, including a volatile demand environment, the postal service contract expiration, severe weather events, and inflation. Yet, we still delivered 60 basis points of adjusted operating margin expansion and a 12% improvement in adjusted operating income." As FedEx looks for the silver lining during stormy economic times, so can you.

How can you leverage carrier uncertainty to reduce your parcel contracts?

ShipRx is an invaluable partner in times like these. Our team has decades of experience with parcel contracts— first with the carriers and now helping businesses like yours secure the best possible rates.

Projections for the parcel industry are less than promising, and that's good news for you. Carriers are motivated to secure new contracts and keep their current ones to avoid losing money— even if that means offering discounts or negotiating more favorable terms on surcharges.

Contact ShipRx today for a free savings analysis and learn how much money you can save through a parcel rate negotiation. We don't get paid until you save money, so you can be sure we'll be honest with you. If your contract looks good, we'll tell you. If not, we'll help you save.