After FedEx announced a preliminary earnings report for Fiscal 2022 that fell far below expectations in mid-September, the carrier has taken active steps to turn things around. It’s announced cost-saving measures and rate increases to ensure success. FedEx will achieve this success by “becoming a leaner and more focused company well positioned to create long-term value for our stockholders supported by our global transformation program,” according to FedEx president and CEO Raj Subramaniam. In this blog post, we’ll talk about the company-wide cost reductions and rate increases for FedEx Express, FedEx Ground, FedEx Home Delivery, and FedEx Freight services starting in January.
With these methods in place, FedEx’s executive vice president and chief financial officer, Michael C. Lenz, says, “I am confident the cost actions we’re implementing with urgency will enhance efficiency and drive improved profitability in support of our long-term financial targets.”
The first four bullet points above may not affect you at all. However, everyone will feel the effects of increased rates. Beginning January 3, 2023, rates are going up for all FedEx customers.
Customers using FedEx Express, FedEx Ground, and FedEx Home Delivery will see an average increase of 6.9%. FedEx Freight rates, dependent on the customer’s transportation rate scale, will increase by 6.9 – 7.9%.
In addition to rate increases, customers can expect an increase in surcharges and fees. These include a $13.25 per package fee for parcels sent to zip codes deemed remote (beginning January 30, 2023) and an 8% fee for late payments on US FedEx Express and FedEx Ground services, among many other increased surcharges starting January 2, 2023.
As FedEx moves ahead with a plan designed to protect its business, how can you protect yours? Soften the blow of rate increases by ensuring you aren’t paying too much for shipping services, and guaranteeing that you’re getting the refunds you deserve when FedEx doesn’t deliver your parcels as guaranteed.
ShipRx helps companies save money on shipping through parcel rate negotiation and parcel audit services. Getting started is free— you only pay when you start saving money. Get in touch today and find out how you can save on shipping before the rate increases go into place.
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