Peak season presents major opportunities for businesses both big and small. With a little inventory preparation, forecasting, and marketing planning, you can reach new customers and sell through inventory, as long as you have the proper infrastructure and shipping partners in order.

As you finalize your fulfillment and shipping strategies—including forecasting costs and selecting carriers—it’s important to factor in holiday shipping surcharges. Read on to learn more about what holiday shipping surcharges are, what fees you can expect from top parcel carriers when self-shipping, and how you can avoid costly fulfillment fees altogether with Flexport Fulfillment.

What Are Holiday Shipping Surcharges?

Holiday shipping surcharges (also known as demand surcharges or peak season surcharges) are additional fees parcel carriers charge during high-volume shipping months, typically between October and January. This is to offset the added equipment, trucks, and labor needed to deliver a larger volume of packages in a shorter window of time.

How to Avoid Holiday Shipping Surcharges: Partner With Flexport

When your business partners with Flexport to fulfill orders during peak season, you’re able to save on residential surcharges (e.g., when an order is delivered to a home or home business), fuel surcharges, and peak fulfillment surcharges that you may incur when self-shipping with carriers or with select other third-party logistics (3PL) providers.

This year, Flexport is foregoing holiday shipping surcharges on top of our standard order fulfillment fees. What you’ve been paying all year in fulfillment fees will be the same costs* you see on your billing invoice during peak season months (October through December).

We’re able to implement this pricing model for two key reasons:

• We place inventory close to the highest levels of customer demand so shipments travel less distance. This allows us to save on shipping costs.
• We absorb the entirety of peak costs associated with warehouse labor and transportation so it has minimal impact on your business.

Additionally, we will be increasing our labor forces to continue to meet on-time shipping and delivery service-level agreements and help your business maintain a positive customer experience throughout the holidays.

NOTE: These costs are relative only to Flexport fulfillment services fees. Other fees may still apply (i.e., for storage and inventory removal services). Visit our Help Center to learn more.

A Breakdown of The Top Three Holiday Shipping Surcharges of 2023

While most holiday shipping surcharges seem minuscule at first glance, they often include several hidden fees that can add up quickly. That’s why we broke down the surcharges from three of the largest carriers below based on publicly available information so you can compare costs and plan accordingly.

FedEx Holiday Shipping Surcharges Increase by 28%

FedEx’s 2023 holiday shipping surcharges will impact key services, including FedEx Express and FedEx Ground.

Demand Surcharges

For packages shipped via FedEx Ground Economy, the surcharge amount varies based on the date when the package is sent.

Surcharge	Effective Dates
$1.60 per package	October 30, 2023–November 26, 2023
$2.60 per package	November 27, 2023–December 10, 2023
$1.60 per package	December 11, 2023–January 14, 2024

Residential Delivery Surcharges (For Enterprise Customers Only)

FedEx also implements a residential delivery charge per package based on service-level volume for Ground and Express services (dynamically adjusted each week based on shipping volume). This applies to Enterprise customers shipping more than 20,000 residential and FedEx Ground Economy packages during a calculation week.

Effective: October 30, 2023–January 14, 2024

SERVICE LEVEL	>105%–125%	>125%–150%	>150%–200%	>200%–300%	>300–400%	>400%
FedEx Ground	$1.35 per package	$1.85 per package	$2.10 per package	$2.65 per package	$4.50 per package	$6.35 per package
FedEx Express	$2.40 per package	$2.90 per package	$3.15 per package	$3.70 per package	$5.55 per package	$7.40 per package

Large Package and Additional Services Surcharges

Oversized packages (more than 70 lbs) and those that require additional handling due to certain dimensions, weight, or packaging specifications will incur additional holiday shipping surcharges this year. You can also expect to pay fuel surcharges which are updated weekly*. Learn more about FedEx’s special handling fees and other charges here.

Surcharge Type	Applicable Services	Charge	Effective Date
Additional Handling Surcharge	U.S. Express Package Services, U.S. Ground Services, International Ground Service	$6.95 per package	October 02, 2023–January 14, 2024
Oversize Charge	U.S. Express Package Services, U.S. Ground Services, International Ground Service	$73 per package	October 02, 2023–January 14, 2024
Ground Unauthorized Package Charge	U.S. Ground Services, International Ground Service	$410 per package	October 02, 2023–January 14, 2024
Fuel Surcharge	FedEx Express, Ground, and Freight Services	18.50% for domestic U.S. and to Puerto Rico Package Services; $0.492 per lb for Domestic and U.S. to Puerto Rico Freight Services	Applicable to packages shipped the wk of 10/9* (see here for weekly fuel surcharge changes)

NOTE: All data points in this section were sourced directly from FedEx’s website. See here for more information.

UPS Holiday Shipping Surcharges Increase by 8%

Similar to FedEx, UPS calculates holiday shipping surcharges based on your shipping volume and applies additional surcharges for packages with special handling requirements.

Demand Surcharges

This year, UPS is implementing a demand surcharge on certain UPS Air Residential, UPS Ground Residential, and UPS Surepost packages, for customers who are billed for more than 20,000 packages during a given week (dynamically adjusted each week based on each package over 105% of the baseline weekly average volume for each service level).

Effective: October 29, 2023–January 13, 2024

SERVICE LEVEL	>105%–125%	>125%–150%	>150%–200%	>200%–300%	>300–400%	>400%
UPS SurePost	$1.35 per package	$1.85 per package	$2.15 per package	$2.60 per package	$4.45 per package	$6.40 per package
UPS Ground Residential	$1.35 per package	$1.85 per package	$2.15 per package	$2.60 per package	$4.45 per package	$6.40 per package
UPS Next Day Air Residential	$2.40 per package	$2.90 per package	$3.20 per package	3.65 per package	$5.50 per package	$7.50 per package
All Other UPS Air Residential	$2.40 per package	$2.90 per package	$3.20 per package	3.65 per package	$5.50 per package	$7.50 per package

Large Package and Additional Handling Surcharges

Large packages (more than 70 lbs) and those that require additional handling due to certain dimensions, weight, or packaging specifications will incur additional holiday shipping surcharges when shipping with UPS during peak season. This applies to customers who meet one of the following criteria:

• Were billed for more than 1,000 total packages in any week after February 2020;
• Were billed for more than 10 combined large packages or packages requiring additional handling in any week after February 2020; or
• Signed up for a new UPS account after December 31, 2020

Learn more about UPS’ special handling fees and other charges here. Additionally, you can expect to pay fuel surcharges (prices are updated monthly*).

Effective: October 01, 2023–January 13, 2024

Surcharge Type	Applicable Services	Charge
Additional Handling	All domestic and international services	$6.90 per package
Large Package Surcharge	All domestic and international services	$74.90 per package
Over Maximum Limits	All domestic and international services	$410 per package
Fuel Surcharge	All UPS Post Sales ground-only shipments	21.75% (applicable to packages shipped October 2, 2023–November 5, 2023*); See here for monthly fuel surcharge changes

NOTE: All data points in this section were sourced directly from UPS’s website. See here for more information.

OnTrac and Lasership's Additional Handling Fees Increase by 184%

OnTrac and Lasership are implementing a residential delivery surcharge on packages delivered to any location that is a residential home, including a business operating out of a residential home.

Demand Surcharges

OnTrac and Lasership’s holiday surcharges are based on your baseline package volume percentage. This means during the demand period, you’ll pay a surcharge on all residential packages shipped during any weekly invoice period that exceeds 105% of your weekly average minimum package volume in June 2023.

Effective: October 28, 2023-January 12, 2024

Baseline Volume	Surcharge
>105%-125%	$1.35 per package
>125%-150%	$1.85 per package
>150%-200%	$2.15 per package
>200%-300%	$2.60 per package
>300%-400%	$4.45 per package
>400%	$6.40 per package

Over Max Limits, Additional Handling, and Fuel Surcharges

An additional surcharge will be applied to any package that requires special handling or that weighs over 50 lbs. Moreover, you can expect to see surcharges for packages delivered to certain ZIP codes within OnTrac/Lasership’s coverage area or when an address provided to OnTrac/Lasership is incorrect or incomplete.

Effective: October 28, 2023-January 12, 2024

Surcharge Type	Details	Charge
Additional Handling	Articles that are not fully encased in corrugated cardboard (i.e., metal, wood, etc.), cylindrical-like items not fully encased in a corrugated cardboard shipping container, and any package routed through irregular package sortation process; Plus, any package with the longest side exceeding 48 inches, its second-longest side exceeding 30 inches, or any package with an actual weight of > 70 lbs	$18.50 per package
Address Correction	An incorrect or incomplete address provided to OnTrac for purposes of completing delivery	$19.50 per package
Delivery Area Surcharge	Packages delivered to certain ZIP codes within OnTrac / Lasership’s coverage area (learn more here)	$5.30 (DAS) / $7.15 (Extended DAS) per package
Over Max Limits	Packages with an actual weight or dimensional weight of > 50 pounds, as measured to determine their billable weight	$700 per package
Fuel Surcharge	OnTrac and Lasership’s fuel surcharges are Index-based and adjusted on the first of each month	15.5% (applicable to packages shipped beginning November 1); See here for monthly fuel surcharge changes

NOTE: All data points in this section were sourced directly from OnTrac’s website. See here for more information.

Compare 2023 Peak Season Surcharges When Self-Shipping

While the specific surcharges your business incurs depend on the carrier you use, the below chart provides a comprehensive view of what peak surcharge amounts you’ll pay on top of regular package pricing when self-shipping with carriers:

Carrier	Applicable Services*	Surcharges	Effective Date
UPS	UPS SurePost, UPS Ground Residential, UPS Next Day Air Residential, All Other UPS Air Residential	Surcharges for each service types are dependent on baseline shipping volume	October 29, 2023–January 13, 2024
FedEx	FedEx Ground Economy	$1.60 per package; $2.60 per package (varies by date range)	October 30, 2023–November 26, 2023 AND December 11, 2023–January 14, 2024; November 27, 2023–December 10, 2023
OnTrac and Lasership	Residential deliveries	$1.35–$6.40 per package (dependent on baseline shipping volume)	October 28, 2023-January 12, 2024
GLS United States	Residential deliveries	$1.50 per shipment	October 30, 2023–January 7, 2024

Note: Surcharge amounts listed in this chart may not be inclusive of all surcharges implemented by each carrier. Additional fees may apply for other applicable services including overweight packages, additional handling fees, etc. For more information, visit each carrier’s website to see a full list of demand surcharge types.

Get Started With Flexport Today

Ensure your peak inventory is inbounded to the Flexport fulfillment network in time to take advantage of zero holiday shipping surcharges when using our fulfillment services. Sign up and create an inbound in your Seller Portal account now.

REMINDER: The deadlines to inbound your inventory to the Flexport fulfillment network are November 6, 2023 for Black Friday and Cyber Monday inventory and November 23, 2023 for Christmas, Hanukkah, and Kwanzaa inventory.

The contents of this blog are made available for informational purposes only and should not be relied upon for any legal, business, or financial decisions. We do not guarantee, represent, or warrant the accuracy or reliability of any of the contents of this blog because they are based on Flexport’s current beliefs, expectations, and assumptions, about which there can be no assurance due to various anticipated and unanticipated events that may occur. This blog has been prepared to the best of Flexport’s knowledge and research; however, the information presented in this blog herein may not reflect the most current regulatory or industry developments. Neither Flexport nor its advisors or affiliates shall be liable for any losses that arise in any way due to the reliance on the contents contained in this blog.