A worker sorts packages at a FedEx facility in Houston. Photo: *Getty Images*

Negotiating surcharge reductions or waivers

One of the most direct approaches is to negotiate with shipping carriers. Businesses can request reductions or waivers for certain surcharges, especially fuel surcharges, which are applied year-round and increase significantly during peak seasons. "You have nothing to lose by asking your FedEx or UPS representative," advises transportation consultant Micheal McDonagh.

According to consulting firms, negotiations are currently more likely to be successful than during the Covid-19 peak, when shipping demand far outstripped supply. However, the negotiation process typically takes 60 to 90 days, so businesses should start early.

Adjusting operations and incentivizing customers

Some surcharges are based on volume and delivery time. For example, FedEx's peak season residential delivery surcharge is based on the increase over the June baseline volume. Therefore, businesses can proactively increase shipping volume in June to mitigate the risk of high surcharges later in the year.

Additionally, businesses can encourage consumers to shop early before the period of increased fees (from 24/11 to 28/12). Offering gift cards or discounts for early orders can help distribute demand and limit extra costs.

Considering alternative carriers

With both FedEx and UPS implementing surcharges, many businesses have turned to smaller carriers or regional delivery services to optimize costs. While their coverage may not be as extensive, these can be flexible solutions during the holiday season, especially for intrastate or short-haul deliveries.

The Dan