FedEx has an annual revenue of $84 billion. Next year, the annual revenue will be even greater due to FedEx’s yearly general rate increase. The 2022 FedEx General Rate Increase will go into effect on January 3th, 2022. FedEx Express shipping rates will increase by an average of 5.9% for Domestic, Export, and Import services. The 5.9% increase is the first time in eight years that the increase is above the annual increase of 4.9%. FedEx SmartPost shipping rates will also increase.
The chart above illustrates the 2022 FedEx price increase over the 2021 published rates for each domestic service. The largest increases are 2-Day A.M. and Express Saver packages. The increase is over 8%.
Express Saver provides delivery to businesses by 4:30 p.m., and to residences by 8 p.m. in three business days. Many eCommerce sellers use Express Saver to meet the demands of today’s online buyers. The Amazonification of buyers’ decisions fuels the shift from Ground to Express. In summary, “Amazonification” is authentic and it is causing sellers to pay more on shipping to remain competitive.
FedEx Ground Price Increases
The chart above illustrates the price increase in 2022 for FedEx Ground packages according to weight. The lowest average increase will be on packages weighing 81 to 100 pounds. Incidentally, these are not very common among our clients. In conclusion, the largest increase is in one to ten-pound shipments.
Home Delivery Rate Increases
FedEx Home Delivery has identical rates as FedEx Ground packages. But, there is an additional charge since the final delivery is to a residence. Therefore, Home Delivery packages are billed as if they were Ground packages but will see an additional $4.75 residential surcharge.
Since the residential surcharge went up this year, we also analyzed the price increase with this fee applied. As you can see, the numbers do change and Home Delivery packages have a higher rate increase than Ground packages.
FedEx Express Rate Increases
The chart below shows the average price increase for all zones and weights for each Express domestic service. As you can see, the Second Day and Express Saver package increases are the highest.
As it is evident by all the charts, FedEx 2-day A.M. and Express Saver have the highest 2022 FedEx Rate Increase. The increase mimics the higher zone increases as Ground and Home Delivery packages.
Other 2022 FedEx Changes
Additionally, look out for the following changes:
- Starting November 1, 2021, a fuel surcharge increase will be applied to domestic FedEx Express, FedEx Ground, and FedEx Freight.
- Additional Handling Surcharge for Express and Ground services will be determined based on the shipment’s zone. Read more here.
- FedEx Freight new fee: No Shipment Tendered of $77 per occurence
- FedEx Ground Economy: Delivery and Returns Surcharge $1.00 per package
- Oversize Charge for Express and Ground services will be determined based on the shipment’s zone.
- International Out-of-Delivery-Area Surcharge and International Out-of-Pickup-Area Surcharge: rates will be applicable from the corresponding tier of the ZIP code or city of the shipment’s origin
- Beginning January 3, 2022, FedEx will offer international shippers the option for time-definite deliveries.
- The new FedEx International Priority Express service, allows customers to schedule delivery by noon to some destinations
Minimize the Impact of 2022 FedEx General Rate Increase
Most companies will accept the 2022 FedEx General Rate Increase (GRI) without any hesitation. They simply shift the additional logistics expenses to the client. This prompts potential buyers to abandon a full shopping cart due to exorbitant shipping costs. Therefore, FedEx users need to address price increases head-on. In addition, contact us at Refund Retriever to assess your shipping needs and help with full contract negotiation.