The end of the year peak season is coming! International courier giants shipping rates are rising! How can sellers control costs?

October 18, 2024

With the end of the peak season approaching, the cross-border e-commerce industry is ushering in the annual logistics peak. At this critical moment, the international courier industry giants UPS, FedEx , DHL have announced plans to increase freight prices, which is undoubtedly a major challenge for cross-border sellers. In the face of this situation, how should sellers respond to ensure the continued profitability of their business? This article will reveal the coping strategies for you.

UPS Shipping Adjustment

Effective December 23, 2024, daily rates for UPS Ground, Air and International services will increase by an average of 5.9%, according to a UPS announcement.

Additionally, effective October 26, 2024, an additional 2% surcharge will be applied to all invoices paid by credit card. Effective January 27, 2025, the calculation of the Large Package Surcharge (LPS) and Additional Handling Charge (AHC) will be revised. Additional Handling Charge (AHC): The length plus perimeter definition of AHC will be replaced by a cubic volume definition, with all other factors remaining the same.

FedEx to follow up

Meanwhile, FedEx announced that it will increase its standard rates for packages and shipments by an average of 5.9% from January 6, 2025, coinciding with UPS’s rate increase strategy. This rate adjustment will apply to the United States within the ground courier and international courier services, as well as from the United States exports or imports of freight business, including Ground Economy, Ground Multiweight, International Premium and other services.

DHL rate adjustment

Freight giant DHL has also announced a new rate adjustment program, although unlike UPS and FedEx, DHL’s rate increase strategy has significant regional differences.

According to DHL’s announcement, starting from January 1, 2025, transportation costs in Hong Kong, Macau, and Taiwan will increase by an average of 4.9%; The average freight cost in Japan has increased by 6.9%; The average shipping cost in Australia has increased by 4.9%. In addition, DHL has adjusted the fuel surcharge rate to 24.5% from October 1st to October 31st, 2024.

How sellers control costs

In the face of the general trend of rising freight rates, cross-border sellers need to pay close attention to the rate dynamics of various freight companies and plan their layout in advance. The following are a few practical cost control suggestions:

1. Optimizing supply chain management

Cost control and efficiency improvement in every step of the process from raw material procurement, production, warehousing to distribution. Utilizing overseas warehousing services for local shipments to significantly reduce international long-distance transportation costs.

2. Fine-tuning inventory management

Implement an advanced inventory management system to reduce inventory backlogs, warehousing costs and capital utilization. Accurately forecast market demand to avoid excess or out-of-stock inventory.

3. Diversified logistics channels

Combine various modes of transportation, such as sea, air and land transportation, and choose the optimal solution according to the characteristics of the goods, the degree of urgency and cost considerations. Cooperate with several logistics companies to compare the cost-effectiveness of different routes and services.

4. Packaging design optimization and product lightweighting

Adopt lightweight, pressure-resistant and drop-resistant packaging materials to reduce the weight and volume of packaging materials. Adopt lightweight design under the premise of ensuring product quality and performance.

5. Bulk shipments

Establish a perfect order management system, consolidate order processing and realize batch shipment. Develop reasonable shipment plans to improve loading rates and reduce unit transportation costs.

6. Building partnerships abroad

Select overseas partners with good reputation and strong strength to jointly carry out cross-border logistics business. Establish an information-sharing mechanism to solve logistics problems collaboratively.

WTS platform helps cross-border sellers

As a leader in cross-border logistics, WTS provides cross-border sellers with one-stop services to meet their needs for cross-border logistics and overseas warehousing. We have warehouses in prime locations and transportation hubs in the U.S. Located at 15056 Shoemaker Ave, Santa Fe Springs, CA 90670 in the core business district of California , we are close to a number of high-speed arterials, and only a stone’s throw away from LAX and the Port of Long Beach, which allows us to quickly connect to all parts of the U.S. and realize highly efficient logistics transshipment.

Relying on WTS’s strong transportation network around the world, our overseas warehouses provide sellers with a full range of integrated logistics solutions including one-piece delivery, self-pickup service, truck delivery and FBA transit.

Same day orders are shipped out on the same day to ensure efficient and fast logistics experience; at the same time, we have independently developed an advanced WMS system to achieve accurate tracking and management of goods; in addition, with our account advantages in the field of end-of-line delivery, we can help sellers effectively reduce logistics costs and enhance market competitiveness!

If you have US overseas warehouse needs, welcome to contact us!

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