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FedEx Agreements: Part 3 – How Do Minimums and Surcharges Work?

By Last updated on: September 23, 2021

In the final part of a three-part series, Refund Retriever unveils the intricate details of a FedEx transportation services agreement. Our goal is to break down the general outline of FedEx agreements to make understanding them more manageable. Therefore we will cover FedEx surcharge reductions and FedEx minimum charge reductions.

Estimated reading time: 4 minutes

Earlier in part one, we reviewed the overall organization of a FedEx agreement. So then, part two explored how the base and earned discounts work for FedEx shippers. The final part of this three-part series will explain how minimum charges and FedEx surcharges work. Also, we will cover the FedEx Money-Back Guarantee as well.

What is a Minimum Charge? 

Very simply, a minimum charge is when a customer agrees to pay the greater amount of the net charge based on discounts or a set minimum within the contract. FedEx will set the minimum charge for all services in the contract. Specifically, a Zone 2 – 1 pound package and further specify any reductions in the price of a Zone 2. 

  • Zone 2 – 1 Pound Package
  • 2022 FedEx Ground Minimum Charge: $9.36
  • 2022 FedEx Priority Minimum Charge: $34.14
  • 2022 FedEx 2Day Minimum Charge: $21.02
  • 2022 FedEx Express Saver Minimum Charge: $19.57
Historical FedEx Minimum Charge_ Zone 2, 1 LB

The FedEx agreement will separate express and ground service minimum charges. FedEx minimum charge reductions are key to receiving your full discount on lower-weight packages. We usually see more express reductions than ground. Large-volume shippers will be able to negotiate a FedEx minimum charge reduction. These fine-print details deliver clarity to customers, so it’s important senders understand the variations among zone charges.

FedEx minimum charge reductions

FedEx Surcharge Reductions

All packages shipped have FedEx surcharges in addition to the base transportation fee. Therefore, we will look at FedEx surcharge reductions. Among them may include two types of surcharges. 

  • Optional service fees: Fees added when you select specific options such as Saturday Pickup or Declared Value.
  • Mandatory service fees: The shipper has no control over the usage of these FedEx surcharges. These include residential, fuel surcharge or delivery area surcharge (DAS).

The prices of FedEx surcharges are set in the FedEx service guide. Although within the FedEx agreement, you can negotiate to modify or eliminate the price of these surcharges. FedEx surcharge reductions will lower the cost of each package. These discounts will be set for a time period as stated in the agreement in Term 1 and 2. Generally, once the term is over, the discounts for the set surcharge modifications will disappear. Subsequently, the shipper then pays the amount as set in the Service Guide. 

FedEx surcharge reductions

This provision will be located in multiple sections of your FedEx agreement. Be sure to read the whole agreement. Read it twice! To summarize, we have seen the money-back guarantee waiver in one section and the opposite information a few pages down.  

FedEx Money-Back Guarantee

All FedEx ground, home delivery, and express packages are guaranteed to arrive on time, or it’s free. However, many new FedEx service agreements eliminate this guarantee. Fortunately, a shipper can request that this is removed from the agreement. A shipper does not have to waive the right to ensure FedEx delivers packages on time. Your customer expects on-time delivery, and so should you.  

FedEx Money-Back Guarantee

This provision will be located in multiple sections on your FedEx agreement. Be sure to read the whole agreement, read it twice! To summarize, we have seen the money back guarantee waiver in one section and opposite information a few pages down.  

FedEx Surcharge Reductions and FedEx Minimum Charge Reductions

FedEx surcharge reductions and FedEx minimum charge reductions will lower your shipping costs on every package. Refund Retriever’s contract negotiation services can take this off your plate. We will analyze your FedEx agreement at no cost. 

In conclusion, if you need help with a FedEx agreement, feel free to reach out to us. Call us at 800-441-8085 or send an email to us, brian@refundretriever.com. Be sure you don’t miss any insight from Refund Retriever by staying in touch with us here

FedEx surcharge reductions and FedEx minimum charge reductions
Brian Gibbs

Author Brian Gibbs

More posts by Brian Gibbs

Brian Gibbs | President of Refund Retriever

Brian Gibbs founded Refund Retriever in 2006 while running his first eBay-based business and seeing the shortcomings of other shipment auditing companies. Refund Retriever's primary focus is FedEx and UPS parcel invoice auditing. After graduating from Texas A&M University in 2001, he graduated from the University of Houston in 2004 with a JD and MBA. Gibbs has been featured in Forbes, Entrepreneur, and other publications discussing parcel auditing, shipping, e-commerce, and more. Learn more at www.refundretriever.com or call (800) 441-8085 for more information.

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