FedEx Ground recently announced that they will apply dimensional weight pricing on all packages beginning January 1, 2015. FedEx Ground currently only assesses dimensional weight on shipments three cubic feet or greater. FedEx invoices at the greater of the actual weight or the dimensional weight. For more information about dimensional weight, check out the previous blog post from March 10th.
You may recall that FedEx and UPS both reduced the dim factor, which increases the dimensional weight, back in 2011. That announcement was made in the last quarter of 2010, allowing shippers little time to prepare. FedEx has decided to make this announcement much earlier, giving shippers a full 7+ months to prepare.
Let’s examine the potential impact of this change. If we have a zone 5 shipment and utilize a one cubic foot box measuring 12x12x12 with an actual weight of 5 lbs., it would now dim out as 11 lbs. Based upon today’s published rate, the shipment would increase from $9.47 to $10.60, which is an 11.9% increase. This is just the increase based on the application of the dimensional logic and is not inclusive of the associated fuel surcharge increase due to the higher freight charge or the general rate increase that will also be applicable in January.
Though no announcement has been made as of yet, it is likely that UPS will follow suit.