Surcharges Archives | Lateshipment.com

Meet Carbon Surcharge: The newest addition to your shipping invoices

Sashank Ravindranath — Fri, 21 Jun 2024 05:31:31 +0000

Major carriers all around the world increase the rates of their services at an average of 4 – 6% YoY.

While carriers transfer this burden of inflation to shippers via increased merchants, most merchants do not do the same to their customers but instead absorb shipping costs as a marketing technique to attract customers.

Returning to rate increases, carriers often cite reasons such as inflation around fuel surcharges and worker demand (particularly around the holiday season), and with the shipper on the onus of these increased rates, shipping is becoming costlier yearly!

If you’re an e-commerce merchant looking to cut down on shipping costs that are eating into your profits, this article is for you. Because not just the usual reasons, but there are instances where unexpected actions can create a domino effect that affects the entire supply chain and causes an increase in shipping rates (remember the surge that happened because of COVID-19?).

One such reason has taken shape in the last year and that is the rate increase in ‘Carbon surcharge’, which while looking trivial, has a role to play in making your shipping bills expensive.

Introducing Carbon Surcharge

Before meeting the carbon surcharge, it is important to understand where it comes from: Carbon taxes.

Multiple industries throughout the globe contribute significantly to emissions, and the shipping industry is no exception. But as the world is increasingly becoming aware of the environmental impacts of carbon emissions, they are indeed taking steps to reduce their carbon footprints.

One of the latest measures introduced to address this issue is the Carbon Tax, one levied on fossil fuel purchases, which is intended to encourage Canadians to reduce their consumption of polluting fuels.

In Canada, the carbon tax, also referred to as the price on carbon, first came into effect at $20 per tonne in October 2019. It has gone up since then, and reached $80 per tonne on April 1, 2024, up $15, from its previous cost of $65 per tonne.

While the carbon tax is set to impact every Canadian, it is set to impact shippers like you even more as carriers such as Canpar, have found a way to levy and increase the rate of ‘carbon surcharge’ for packages shipped through them.

In Canpar’s press release, they highlight that this surcharge affects multiple aspects of the economy and impacts costs across their entire network ranging from transportation costs to energy costs for heating, to equipment purchases and maintenance and hence, the rate increase.

Additionally, they mention that it has become necessary for them to apply a Carbon Surcharge of 2.5% effective from September 1st, 2023, for all shipments handled by them.

How is the Carbon Surcharge Calculated?

The Carbon Surcharge is typically calculated based on the amount of carbon dioxide (CO2) emissions produced during the shipping process. Factors influencing the surcharge include:

Distance Traveled: Longer shipping distances generally result in higher CO2 emissions.
Mode of Transport: Different transportation methods have varying emission levels. For instance, air freight has a higher carbon footprint compared to sea or rail freight.
Weight and Volume: Heavier and bulkier shipments require more energy to transport, leading to higher emissions and, consequently, a higher surcharge.

Shipping companies may use carbon calculators or partner with environmental organizations to accurately assess and apply the surcharge.

What Does The Increase In Carbon Surcharge Mean For Businesses?

While Canpar has announced an increase in its carbon surcharge, citing financial and operational considerations, this move brings in specific challenges and opportunities for businesses that ship parcels with Canpar.

Increased Shipping Costs

For the elephant in the room, i,e, the most immediate impact of the increased carbon surcharge is the rise in shipping costs. If you’re a shipper that relies on Canpar for your logistics, you will see an uptick in their operational expenses that may affect your profit margins and force you to reevaluate your pricing strategies to accommodate the additional costs.

Additionally, you will need to adjust their budgets to account for the higher costs associated with the increased surcharge. This might require reallocating resources from other areas or finding ways to optimize operations to absorb this additional expense.

Supply Chain Optimization

The increase in the carbon surcharge by Canpar also encourages you to take a closer look at your supply chain and logistics operations.

For instance, you can:

Find the most efficient routes to reduce travel distance and time can help mitigate the impact of higher surcharges.
Combine shipments to reduce the number of trips can lead to reduced surcharge’s impact
Explore different shipping methods that may have lower carbon footprints compared to those with a higher surcharge, as a strategic move.

How Businesses Can Lower Their Shipping Costs And Make Profits

Carriers can afford to increase their surcharges and transfer the burden of inflation on you. But in most cases, you cannot afford to do that. Given that customers are picky with shipping costs and often go to the extent of expecting free shipping from the businesses they shop with, you are set to face the brunt of it.

So, what can do if you’re looking to cut down costs and reduce the impact of these surcharges? Of course, you can always settle with the option of reallocating budgets and optimizing supply chain routes. But what if I told you that there are even better options?

And that is to audit your shipping invoice, check for incorrect surcharges and overcharges, and claim full refunds for them. You can do this manually, exhausting all your time and resources or make use of an automated solution like LateShipment.com that eases your job.

How LateShipment.com’s automated shipping audit and refunds work

LateShipment.com automatically audits your invoices end-to-end (every invoice goes through a rigorous 160 data-point check, validating each charge against your shipping transactions, payment terms, and waivers) to identify service failures and billing discrepancies eligible for refunds.

The best part is that our automated systems promptly submit refund claims, in compliance with the carrier’s terms and conditions, securing all eligible refund credits, and ensuring that no surcharge is left out.

Also, our systems come with a surcharge spend analytics that helps you Understand surcharge patterns and their impact on shipping costs to keep you better positioned while negotiating parcel contract rates that work in your favor.

There’s a lot more you can do with LateShipment.com. Make sure you check it and ensure that you can try to cut down your shipping costs by as much as 20%.

Conclusion

Surcharges like the carbon surcharge represent a pivotal shift in the shipping industry. They are here to stay, increase, and take new forms as time passes. Of course, they reflect a growing environmental commitment and promote sustainability. But from the perspective of shipping carriers, the carbon tax is just an additional expenditure they’d like to pass on to shippers like you.

Again, there’s no blaming carriers for increasing surcharges to meet their ends, they work on your behalf after all. But that doesn’t mean you simply keep paying shipping carriers more than you ought to. Keep your invoices in check, claim refunds wherever you can, and ultimately ensure better performances from them for the costs that you pay.

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A Guide to FedEx and UPS Delivery Signature Options

Sashank Ravindranath — Wed, 24 Apr 2024 13:10:49 +0000

In the world of shipping and logistics, ensuring your packages reach their destination safely and securely is crucial and carriers ensure their full-on commitment to it.

One aspect of this process is the carrier getting a confirmation of receipt upon successfully delivering a package to its intended recipient or an authorized individual at the delivery address through a signature. This signature helps carriers ensure security and accountability throughout the delivery process.

Before diving into the specifics of FedEx and UPS signature options, let’s first understand what they entail:

Understanding Delivery Signature Options

Both FedEx and UPS offer various signature options to accommodate the diverse needs of businesses and customers. These delivery signature options allow senders to choose the level of security and verification required for their shipments, depending on the nature of the package and recipient preferences.

Why shippers need to choose delivery signature options

Shipping out packages comes with a lot of risk up until the delivery is made. Hence, shippers need to ensure secure and reliable delivery of packages while meeting regulatory requirements. This is where delivery signature options come in to help shippers maintain accountability and compliance.

Requiring delivery verification, especially for high-value shipments ensures that the package has arrived safely without falling into the wrong hands such as porch pirates among other reasons, and thereby offers you peace of mind.

As a shipper, it’s essential to consider factors such as the value of the shipment, recipient availability, and the level of security required when selecting a delivery signature option.

In this blog, we’ll explore the different delivery signature options provided by FedEx and UPS, helping you determine which one is best suited for your shipping requirements.

FedEx Delivery Signature Options

FedEx provides three options when shippers require a signature upon delivery. Each option accommodates different shipment requirements.

1. FedEx Adult Signature Required

Costs around $8.15 in 2024
Specifically designed for shipments containing age-restricted items, particularly at least 21 years old at the delivery address.
A government-issued photo identification is required
When there is no eligible recipient at the delivery location, FedEx may re-attempt the delivery
Firearms are one type of shipment where an adult signature is required

2. FedEx Direct Signature Required

Costs around $6.75 in 2024
Designed for shipments that are to be delivered at a location instead of a specific individual
Any person physically available at the location can sign for the delivery
When there is no eligible recipient at the delivery location, FedEx may re-attempt the delivery
Automatically applies to all packages equal to or greater than $500. However, the direct signature required fee will not apply to these packages

3. FedEx Indirect Signature Required

Costs around $6.75 in 2024
This allows FedEx to collect a signature even from some nearby the location such as neighbors, front office, or building managers
Even if there’s no eligible recipient at the delivery location, FedEx can still make the delivery without re-attempting, given that the recipient has authorized

Just like FedEx, UPS too has its own set of Delivery Signature Options or Confirmation Services that are served as a value-added service because they’re slightly more safer than just a regular ‘delivered’ parcel tracking notification.

UPS Delivery Signature Options

1. UPS Delivery Confirmation

Costs around $6.75 in 2024
Includes a delivery date, the name of the recipient, and if the package is being returned, the reason for the return is mentioned

2. UPS Signature Required

Costs around $6.75 in 2024
A physical recipient is not required at the location as UPS accepts any electronic acknowledgment of receipt from the individual to deliver the package

3. UPS Adult Signature Required

Costs around $8.15 in 2024
Specifically designed for shipments containing age-restricted items, particularly at least 21 years old at the delivery address.
A government-issued photo identification is required
An additional voice authorization or ‘Proof of Delivery’ option is available, where UPS may call the person physically available at the delivery location for an additional $5.00

Final Word

Be it FedEx or UPS, delivery signature options don’t come cheap. Also, these rates increase during peak season times and have a consistent YoY increase. Of course, paying an additional $7 will give you the peace of mind of your package reaching its destination safely and securely but you can also cut these costs in several ways:

Make full utilization of these options: For instance, let’s say you’ve ordered some wine for your boss’ retirement party and it requires an adult signature. In such cases, ensure that either you or an adult is at the delivery location to collect the package instead of re-delivery attempts.
Limit further re-delivery attempts: When you’re out of town but have a series of packages that require direct signatures, you can redirect your shipments to a FedEx location for 5-10 days.
Negotiate with your carrier: if you’re a high-volume shipper or have a long-standing relationship with the carrier, you can also negotiate a contract with your shipping carrier that includes favorable terms and pricing for delivery signature options.

Also, wrongly added delivery signature costs are a common sighting in your shipping invoices. In such cases, you can audit your invoices and file refund claims for such additional charges.

In conclusion, both carriers offer a range of delivery signature options to accommodate diverse shipment requirements. Make sure you select the right option for your needs and ensure the costs that come along with them aren’t straining your wallet.

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Everything You Need to Know about the Changes Made to Canada Post, UPS, FedEx and Purolator’s Money-back Guarantee

Sashank Ravindranath — Fri, 09 Apr 2021 12:44:03 +0000

This article has been updated as of 23rd August, 2021.

It’s been a year since the COVID-19 pandemic debuted and created panic across the globe, dramatically changing the way we live our lives.

The eCommerce retail industry felt the brunt of the pandemic’s impact, just like every other industry out there.

While many retailers had to shut shop temporarily, others scrambled to deal with the humongous surge in demand. As a result, eCommerce retail – especially the supply chain and post-purchase aspect went under the scanner.

And as if this weren’t overwhelming enough, businesses also faced challenges from shipping carriers through peak surcharges and a suspension on money-back guarantees which have almost emptied SMB owners’ purses in the form of shipping bills.

While peak surcharges are still levied on packages that are being shipped to certain remote locations, major shipping carriers such as FedEx, UPS, and Purolator reinstating their money-back guarantee for select service types is certainly some good news for eCommerce business owners.

What is the Money-back Guarantee Policy?

The Money-Back Guarantee (MBG) is a clause that is part of a shipping contract that stipulates that major shipping carriers such as FedEx, UPS, Purolator, etc promise to offer you a full refund on shipping charges if parcel delivery is delayed by even 60 seconds except in exceptional circumstances (natural disasters, weather delays, etc). Apart from the Money-Back Guarantee, shipping carriers offer refunds for 50+ service failures & billing errors including late, lost, and damaged deliveries, surcharge errors, etc.

And as you may be aware, due to disruptions in the global supply chain caused by COVID-19, all major shipping carriers around the world had suspended their Service Guarantee, also known as Money-Back Guarantee across all service types.

What are the Recent Changes Made to the Money-back Guarantees?

While continuous efforts are being made to restore normalcy in operations – carriers including UPS, FedEx, and Purolator have REINSTATED their Money-Back Guarantee for some service types, effective April 5, 2021.

The latest carrier to resume On-time Delivery Guarantees is Canada Post for parcels shipped within Canada. The delivery guarantees will take effect starting August 23, 2021.

This translates to more savings on your shipping bills, given that over 20% of all shipments faced delivery issues in 2020.

But first, you must stay in the loop of the select services that are now eligible for the money-back guarantee. And that’s why we’ve compiled them for you.

Want this list right in your device?

We’ve also presented the same as a downloadable document below for you to access the links and read more about money-back guarantee being reinstated from the carriers themselves.

How LateShipment.Com Can Help You

At LateShipment.com we are committed to ensuring that every dollar in refund claims is returned to you.

Throughout the pandemic, LateShipment.com has been monitoring and filing claims for 50+ service failures on your behalf. With the reinstatement of select Money-Back Guarantee claims, we will be able to recover even more claims (that’s even more shipping cost savings!)

Our automated parcel audit and refunds solution effortlessly audits your invoices and helps save up to 20% on your shipping costs. The best part is that it takes less than 2 minutes to set up and seamlessly integrates with your existing workflow.

That’s not all! Here are some more benefits of using LateShipment.com

50+ carriers supported – With customers in over 40 countries, we successfully claim refunds from carriers worldwide.
Highly-trained algorithms – Our exclusive technology is built in-house with algorithms trained from tracking over 100M parcels.
Human-backed automation – Our automated claims system is human-backed to ensure that you never miss any refunds.
Maximum refunds recovery – Apart from common service failures, our systems are built to recover refunds for 50+ carrier errors.
No upfront cost – Zero out-of-pocket costs for your business. Pay only a part of the refunds claimed.
Refund claims for previous shipments – We don’t wait for you to ship out packages. Our systems can backtrack up to 45 days and claim refunds even for past shipments.

Feel like you’re missing out? Worry not, it is never too late to start claiming refunds!

Try LateShipment.com today now and save up to 20% on your shipping costs while providing memorable delivery experiences for your customers (It just takes 2 minutes).

Still doubtful? You can get in touch with us by scheduling a call with our expert or writing to us at sales@lateshipment.com

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What the recent FedEx price hike means for retailers

Joelah James — Mon, 27 Aug 2018 13:52:48 +0000

By now, you’d have heard about the FedEx price hike for Additional handling and Ground Unauthorized surcharges. Effective since September 3, this recent hike comes right on the heels of the January price hikes for additional handling, oversize and ground unauthorized surcharges, third party billing, and FedEx Freight over length surcharge. When carrier rates have been rising left, right and centre, this news can have a major effect on the bottomline of small business owners who have a niche customer pool.

What’s new with this surcharge?

As per this recent FedEx price hike, the additional handling charges for packages weighing more than 70 lbs will increase from $12 to $20. The same will apply for international express package services.

The ground unauthorized package charge will increase from $300 to $675.

What this means for retailers

This hike will be a disadvantage to several shippers, say for instance furniture or automobile retailers. These rate increases specifically target niche shippers who ship heavy or oversized products. This highly minimizes the impact (as it is aimed at only specific industries), and shipping carriers get to escape the brunt of the backlash that is usually inspired by such sudden price increases. If there are around 100 shipments in transit, and a few of them get damaged or unevenly distributed, the change in dimensional weight is inevitably billed to the shipper.

The irony is that shipping carriers try to penalize customers for mistakes, while they do not own up to their own mistakes and offer automated refunds for service errors.

In many cases, the mistake in dimensional weight billing lies on the carrier’s side but is slapped onto the customer and billed to his/ her invoice. It’s high time shipping prices became transparent and these unfair pricing policies came to an end.

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Compare Shipping Rates of USPS vs UPS vs FedEx vs DHL in 2018

Bianca Barath — Thu, 15 Feb 2018 12:54:28 +0000

Dimensional Weight Pricing

UPS and FedEx have recently started to charge a dimensional weight fee. Until recently, your shipping rates with these two carriers depended on package weight. Now, the package size matters. So, if you have been shipping light weight goods that occupy significant space in shipping trucks or planes, you will be expected to pay more now. Dimensional weight pricing was applicable only with packages that are larger than three cubic feet. If you shipped smaller items, there was no change in your shipping rates. But that again has changed and now, every package is subject to dimensional weight rules.

FedEx had changed its dimensional weight divisor from 166 to 139 on January 2, 2017, for only U.S. ground and Express shipments. Now, in 2018, FedEx SmartPost is also added to the list of service levels with the 139 dimensional weight divisor. UPS has a dimensional weight divisor of 139 for packages bigger than 1,728 cubic inches or one cubic foot. And the weight divisor is 166 for smaller packages.

Peak Shipment Surcharge

UPS announced a new peak surcharge fee in June 2017. And then, UPS updated it twice to expand its geographic reach. There are also added extra charges for excessively heavy packages going to Puerto Rico, Hawaii or Alaska, as well as packages from Hong Kong or China.

General Rate Increases

UPS raised its air and ground service rates by 4.9% in 2017. FedEx has raised rates differently for these services.

Negotiable Rates:

FedEx and UPS account managers have the authority to lower your shipping rates if you offer volumes. So, if you are a higher volume shipper, ask your account manager to lower rates. FedEx depends on several middlemen to deliver their goods. So, there are bound to be more taxes in their invoices.

DHL is a great choice if you are looking to ship internationally. Within the US, it’s not a viable option. This is because DHL is headquartered in Germany and not in the US. They excel in international shipping. So, choose DHL services if your shipments are predominantly in overseas markets.

The USPS has affordable options within the US. In fact, it is the most affordable choice among all four. There are no surcharges for fuel, remote areas, additional handling etc. Their delivery speed is not excellent but it works well if you are on a budget. If you deal with non-urgent, small-scale and nearby deliveries, USPS is your best bet.

Shipping costs of FedEx and UPS – Compare for best deals

How To Choose The Right Shipping Carrier?

5 Smart strategies to master International Shipping

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