Shipping Rate Updates

2025 Carrier Rate Increases

Heading into 2025, both FedEx and UPS have announced the same increase to base rates as last year, averaging 5.9%. However, this average is just that, with the actual increase varying by package characteristics, travel distance (zone), and which surcharges apply.

Surcharges will increase by an average of approximately 5.9%, with the biggest impact being on Additional Handling fees increasing by a whopping 26% on average.

While these increases pose a challenge, they apply to all shippers and are being implemented by all carriers.

One way to help offset these increases is by shortening the distance (zones) that each package travels. Lower zones reduce the cost of base rates and also the Additional Handling surcharges. This is especially true in 2025 as rates are increasing by a slightly smaller percentage for lower zones versus higher zones.

If you’re not already utilizing multiple locations in a2b’s network, feel free to reach out to start this conversation. As a reminder, we currently have 5 locations covering the Southeast, Northeast and West.

Please take a moment to review next years’ carrier changes below, adjust your shipping charges accordingly and make time to discuss how our 3-Region Fulfillment Strategy can help you combat the carrier increases.

FEDEX - Effective January 6th 2025:

‍FedEx Ground, Home Delivery and Express‍

FedEx’s general rate increase average this year comes in the same as last year. Ground, Home Delivery and Express will all increase by an average of 5.9%; however, please note that this is an average across all weights and zones. The minimum base charge for Ground will increase from $10.70 to $11.32.

Accessorial charges are also increasing as follows:

‍Address Corrections
The Address Correction surcharge will increase $1.50 to $24.00.

‍Delivery Area Surcharges - Ground and Home Delivery
For packages delivered to certain Zip Codes within the 48 contiguous states:

• Delivery Area Surcharge applied to commercial addresses will increase $0.25 to $4.20.
• Delivery Area Surcharge applied to commercial extended addresses will increase $0.35 to $5.25.
• Delivery Area Surcharge applied to residential addresses will increase $0.50 to $6.20.
• Delivery Area Surcharge applied to residential extended addresses will increase $0.50 to $8.30.
• Delivery Area Surcharges for Air/Express shipments to residences are slightly higher than those of Ground and Home Delivery.
• Remote Address Fee increases $1.25 to $15.50.

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Residential Surcharges
The Residential Surcharge will increase $0.40 to $5.95 for Home Delivery and $0.40 to $6.55 for Air/Express Services.Additional Handling Surcharges
All three categories of the Additional Handling Surcharge are increasing significantly in 2025.

Oversize Surcharge
For domestic shipments, a package is considered a “Large Package” when its length (longest side of the package) plus girth [(2 x width) + (2 x height)] combined exceeds 130 inches or its length exceeds 96 inches.

FedEx Ground Economy      FedEx Ground Economy rates increase by an average of 5.2% for packages weighing 1-9 lbs in zones 2-8 and 0% for packages weighing 10-20 lbs, both representing softer increase than in the previous year.Delivery and Returns SurchargeThis fee increases $0.05 to $1.10.Delivery Area Surcharges - Ground Economy (formerly Smartpost)
For packages delivered to certain Zip Codes within the 48 contiguous states:

• Delivery Area Surcharge applied to residential addresses increases $0.20 to $4.00.
• Delivery Area Surcharge applied to residential extended addresses increases $0.30 to $5.35.
     

Non-Machinable Charge
Applies as follows:

• Any package with one dimension measuring more than 27 inches.
• Any package with any two dimensions each measuring more than 17 inches.
• Any package weighing over 35 lbs.
• Any item packaged in a cylindrical shipping tube.
• Rate increases $0.50 to $6.55.
• ‍UPS - Effective December 23rd, 2024:      

UPS Ground and ExpressUPS’s general rate increase this year comes a full two weeks earlier than that of rival FedEx. Ground and Express will all increase by an average of 5.9%; however, please note that this is an average across all weights and zones. The minimum base charge for Ground will increase from $10.70 to $11.32. Accessorial charges are also increasing as follows:Address Corrections
The Address Correction surcharge will increase $2.50 to $23.50.Delivery Area Surcharges - Ground
For packages delivered to certain Zip Codes within the 48 contiguous states:

• Delivery Area Surcharge applied to commercial addresses will increase $0.25 to $4.20.
• Delivery Area Surcharge applied to commercial extended addresses will increase $0.45 to $5.35.
• Delivery Area Surcharge applied to residential addresses will increase $0.45 to $6.15.
• Delivery Area Surcharge applied to residential extended addresses will increase $0.50 to $8.30.
• Delivery Area Surcharges for Air/Express shipments to residences are slightly higher than those of Ground.
• The US48 Remote Area Surcharge, which applies to extremely remote addresses, will increase $1.20 to $15.35.
      

Residential Surcharges
The Residential Surcharge will increase $0.45 to $6.10 for Ground and $0.35 to $6.55 for Air/Express Services.Additional Handling Surcharges
All three categories of the Additional Handling Surcharge are increasing.

Large Package Surcharge      For domestic shipments, a package is considered a “Large Package” when its length (longest side of the package) plus girth [(2 x width) + (2 x height)] combined exceeds 130 inches or its length exceeds 96 inches. Rates are:

‍USPS – Effective January 19th, 2025:      The USPS has proposed increased rates that will take effect on January 19th, 2025. The effect will be seen on services that we contract directly with the USPS (Priority Mail, Ground Advantage, and International Services), as well as for discounted services, such as our Under 1 lb. service from UPS Mail Innovations, which uses the USPS for final mile delivery.Priority Mail will increase an average of 2.55%.Ground Advantage – under 1 lb (formerly First Class Package) will increase by an average of 3.2%.Ground Advantage – over 1 lb will increase by an average of 5.03% for packages weighing 1-9 lbs and 3.74% for those weighing 10-20 lbs.Tips for Keeping Your Shipping Costs Low:

1. Keep products under 1 lb. when possible. Less than 1 lb. packages are eligible for the lowest-cost shipping methods.
2. Reduce the size of your packaging when possible. Dimensional weight means that larger packages cost more. Also, packages that are deemed too large are subject to additional surcharges, including Additional Handling and Large Package/Oversized/Non-Standard. As a reminder, a2b’s advanced technology automatically suggests the smallest carton to protect you from not spending more than necessary in this category.
3. Utilize our Rate Shop shipping codes instead of carrier/service-specific shipping codes. For example, if you want the lowest rate, send us R06 as the shipping method and our system will automatically apply the lowest cost service based on weight and zone. Or if you want 2 Day service, use T10. Our system will choose Ground over2 Day Air most of the time due to our proximity to most consumers, saving you significant cost from unnecessary upgrades to Air/Express services. Contact support@a2bf.com for questions about how to use Rate Shop codes.
4. Shorten your zones by expanding geographically with a2b. Talk to us about our 3-Region Fulfillment Strategy, which includes fulfilling from1.) Southeast (GA / SC), 2. West (UT), and 3. Northeast (PA).

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Shipping rates frequently fluctuate as shipping carriers adjust their pricing. This can significantly impact shipping costs for both businesses and consumers alike.

Below are the details of the 2024/2025 Demand Surcharges rate increases.

Consistent with previous years, the shipping carriers are imposing Demand Surcharges to cover their additional operating costs during peak periods when volumes are extraordinarily high.

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Additional Handling Demand:

• 09/30/2024 – 11/24/2024 from $3.45 to $7.75
• 11/25/2024 – 12/29/2024 from $7.75 to $10.00
• 12/30/2024 – 10/19/2025 from $10.00 to $7.75

Demand Surcharges and are in addition to the Surcharges themselvesOversize Demand:

• 09/30/2024 – 11/24/2024 from $39.50 to $84.50
• 11/25/2024 – 12/29/2024 from $84.50 to $100.00
• 12/30/2024 – 01/19/2025 from $100.00 to $84.50

Demand Surcharges and are in addition to the Surcharges themselvesExpress Demand:

• 10/28/2024 – 11/24/2024 from $1.00
• 11/25/2024 – 12/29/2024 from $2.00
• 12/30/2024 – 01/19/2025 from $1.00

*For high volume shippers tendering more than 20,000, Residential and Ground Economy packages weekly, additional Demand charges will apply based on shipper’s volume and peaking factor, ranging from $2.60 - $8.25. Demand Surcharges and are in addition to the Surcharges themselvesGround Residential and Home Delivery Residential Demand:

• 10/28/2024 – 11/24/2024 from $0.30
• 11/25/2024 – 12/29/2024 from $0.55
• 12/30/2024 – 01/19/2025 from $0.30

*For high volume shippers tendering more than 20,000, Residential and Ground Economy packages weekly, additional Demand charges will apply based on shipper’s volume and peaking factor, ranging from $1.45 - $7.10.Ground Economy Demand:

• 10/28/2024 – 11/24/2024 from $1.90
• 11/25/2024 – 12/29/2024 from $3.15
• 12/30/2024 – 01/19/2025 from $1.90

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‍Additional Handling Demand:

• 09/29/2024 – 11/23/2024 from $3.50 to $7.75
• 11/24/2024 – 12/28/2024 from $7.75 to $9.95
• 12/29/2024 – 01/18/2025 from $9.95 to $7.75

Demand Surcharges and are in addition to the Surcharges themselvesLarge Package Demand:

• 09/29/2024 – 11/23/2024 from $40.00 to $84.75
• 11/24/2024 – 12/28/2024 from $84.75 to $99.00
• 12/29/2024 – 01/18/2025 from $99.00 to $84.75

Demand Surcharges and are in addition to the Surcharges themselvesAir Demand:

• 10/27/2024 – 11/23/2024 from$1.00
• 11/24/2024 – 12/28/2024 from $2.00
• 12/29/2024 – 01/18/2025 from $1.00

*For high volume shippers tendering more than 20,000, Residential and Surepost packages weekly, additional Demand charges will apply based on shipper’s volume and peaking factor, ranging from $2.65 - $8.25.‍Ground Residential and Surepost Demand:

• 10/27/2024 – 11/23/2024 from $0.25
• 11/24/2024 – 12/28/2024 from$0.50
• 12/29/2024 – 01/18/2025 from $0.25

*For high volume shippers tendering more than 20,000, Residential and Surepost packages weekly, additional Demand charges will apply based on shipper’s volume and peaking factor, ranging from $1.50 - $7.05.Mail Innovations Demand:

• 11/03/2024 – 12/13/2024 – Charges mirror Ground Advantage (see USPS section below).
• Packages weighing more than 10 lbs. will be assessed an additional $2.00 charge.
• Packages to Zone 9 will be assessed an additional $2.00 charge.

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‍Effective 10/06/2024 – 01/19/2025‍Priority Mail and USPS Ground Advantage: Zone 1-4

• $0.30 cents increase for Zones 1-4, 0-3 lbs.
• $0.45 cents increase for Zones 1-4, 4-10 lbs.
• $0.75 cents increase for Zones 1-4, 11-25 lbs.
• $3.00 increase for Zones 1-4, 26-70 lbs.

Priority Mail Zone 5-9

• $0.70 cents increase for Zones 5-9, 0-3 lbs.
• $1.25 increase for Zones 5-9, 4-10 lbs.
• $2.75 increase for Zones 5-9, 11-25 lbs.
• $7.00 increase for Zones 5-9, 26-70 lbs.

USPS Ground Advantage Zone 5-9

• $0.35 cents increase for Zones 5-9, 0-3 lbs.
• $0.75 cents increase for Zones 5-9, 4-10 lbs.
• $1.25 increase for Zones 5-9, 11-25 lbs.
• $5.50 increase for Zones 5-9, 26-70 lbs.