Holiday Shipping Surcharges: What eCommerce Merchants Need to Know for 2022

Introduction: The Busy Holiday Shipping Season

The holiday season is upon us, and for eCommerce merchants, this means gearing up for the busiest time of the year. With an estimated 850 to 950 million packages expected to be delivered during the holidays, it's crucial to understand the impact of increased shipping rates and potential delays. At FreightAmigo, we're here to help you navigate these challenges and ensure a smooth shipping experience for your customers.

This year, major courier companies like USPS, FedEx, and UPS are implementing temporary shipping increases for the holiday season. As a digital logistics platform, we'll explore why shipping becomes more expensive during this period and how you can prepare your eCommerce business for peak season shipping.

Understanding the Factors Behind Holiday Shipping Costs

Before we delve into the specifics of holiday surcharges, it's important to understand that shipping costs are not uniform. Several factors influence the final cost of shipping a package:

• Package weight
• Package dimensions
• Shipping distance
• Shipping speed

These basic factors are always at play, but during the holiday season, additional elements come into the picture, driving up costs even further.

Why Is Holiday Shipping More Expensive in 2022?

Several factors contribute to the increased shipping costs during the 2022 holiday season:

1. The Surge of Holiday Shipments

The holiday season naturally brings a significant increase in shipments. To handle this surge, major courier companies need to prepare by hiring additional staff. For instance:

• USPS is hiring over 40,000 seasonal workers
• UPS is bringing on 100,000 seasonal employees

These additional labor costs are reflected in higher shipping rates. As a digital logistics solution provider, we at FreightAmigo understand the importance of efficient resource allocation during peak seasons.

2. Ongoing Global Supply Chain Crisis

The global supply chain continues to face challenges, which impacts shipping costs across the board. For example, the average price to ship a 40-foot container has more than quadrupled in the last year. A full container from Asia to the US now costs nearly $20,000, with prices still on the rise.

Our digital platform at FreightAmigo is designed to help navigate these complexities, offering real-time insights into shipping options and costs.

3. Lingering Effects of COVID-19

The pandemic continues to influence global logistics. From labor shortages to changes in consumer behavior, COVID-19's impact is still felt in the shipping industry, contributing to higher costs and potential delays.

Holiday Shipping Rate Increases from Major Carriers

Let's break down the temporary rate increases implemented by major courier companies for the 2022 holiday season:

USPS Holiday Surcharges

The United States Postal Service is implementing temporary rate increases from October 3 to December 26, 2022. Merchants can expect to pay an additional $0.25 to $5.00 for shipping parcels during this period. Here's a breakdown of the USPS holiday rates:

• $0.75 increase for Priority Mail, Priority Mail Express Flat Rate boxes and envelopes
• $0.30 increase for First Class packages
• $0.25 increase for Zones 1-4 (0-10 pounds)
• $0.75 increase for Zones 5-9 (0-10 pounds)
• $1.50 increase for Zones 1-4 (11-20 pounds)
• $3.00 increase for Zones 5-9 (11-20 pounds)
• $2.50 increase for Zones 1-4 (21-70 pounds)
• $5.00 increase for Zones 5-9 (21-70 pounds)

As a digital logistics platform, FreightAmigo can help you navigate these complex rate structures and find the most cost-effective shipping solutions for your needs.

FedEx Holiday Surcharges

FedEx is also implementing temporary rate increases for the holiday season. Merchants can expect to pay at least $1.50 extra per package during this peak shipping period. The exact surcharges may vary depending on the specific service and package characteristics.

UPS Holiday Surcharges

UPS is increasing its rates from October 31, 2022, through January 15, 2023. Shippers can expect additional surcharges ranging from $0.11 to $2.61 per pound. These surcharges apply to various routes, including:

• Shipments from China to the US
• Shipments from Vietnam to the US
• Shipments from Japan to the US
• Shipments from Australia, New Zealand, and other Asian countries to the US
• Shipments from the US to Australia and New Zealand
• Shipments from Europe to the US and North America

Additionally, UPS is implementing an Additional Handling Surcharge during this period.

Strategies to Manage Holiday Shipping Costs

As eCommerce merchants face these increased shipping costs, it's crucial to develop strategies to manage expenses without compromising customer satisfaction. Here are some approaches we at FreightAmigo recommend:

1. Leverage Digital Logistics Platforms

Digital logistics platforms like FreightAmigo offer access to competitive shipping rates from multiple carriers. By comparing options on a single platform, you can find the most cost-effective shipping solution for each package.

2. Consider Alternative Shipping Methods

While express shipping is popular during the holidays, consider offering slower, more economical options to price-sensitive customers. Our platform can help you evaluate and present these alternatives to your customers.

3. Optimize Packaging

Since both weight and dimensions affect shipping costs, optimizing your packaging can lead to significant savings. Use our digital tools to calculate the most efficient packaging for your products.

4. Plan for Early Shipping

Encourage your customers to shop and ship early to avoid the highest peak season surcharges. Our platform can help you communicate shipping deadlines clearly to your customers.

5. Explore Consolidation Options

For businesses shipping multiple packages to similar destinations, consolidation can offer cost savings. FreightAmigo's digital logistics solutions can help identify consolidation opportunities.

Navigating Holiday Shipping Delays

In addition to increased costs, holiday shipping often comes with the risk of delays. Here are some strategies to mitigate this issue:

1. Set Realistic Expectations

Communicate clearly with your customers about potential delays. Use our digital platform to provide accurate, up-to-date shipping estimates.

2. Offer Order Tracking

Provide customers with real-time tracking information. FreightAmigo's platform integrates with various carriers to offer comprehensive tracking capabilities.

3. Have a Contingency Plan

Be prepared to switch carriers or shipping methods if delays become excessive. Our digital logistics solution allows for quick pivots when needed.

Conclusion: Embracing Digital Solutions for Holiday Shipping Success

The 2022 holiday shipping season presents challenges for eCommerce merchants, with increased rates and potential delays. However, by leveraging digital logistics platforms like FreightAmigo, businesses can navigate these challenges effectively. Our comprehensive suite of tools and services enables you to compare rates, optimize shipping strategies, and provide excellent service to your customers.

As we approach this busy season, remember that preparation is key. By understanding the surcharges, planning your shipping strategy, and utilizing digital logistics solutions, you can turn the holiday shipping challenge into an opportunity for business growth and customer satisfaction.

At FreightAmigo, we're committed to helping you deliver joy this holiday season, one package at a time. Let's work together to make this holiday shipping season a success for your eCommerce business.