How Do I Avoid FedEx Residential Surcharge?

When it comes to shipping, not having a proper plan can result in excessive expenses, draining your transport budget faster than necessary. One of the factors contributing to these increased costs is surcharges. In this blog post, we'll address the question 'How Do I Avoid FedEx Residential Surcharge?' and provide insights to prevent you from incurring it.

What Is Residential Surcharge?

A residential surcharge is a fee that a carrier charges, on top of the standard delivery fee, to deliver packages to a home/residential address. This also applies to businesses being run out of a home.

Why Do Carriers Charge the Residential Surcharge?

Delivering packages to residential locations can pose challenges for carriers, often necessitating the imposition of residential surcharges.

Firstly, residential areas tend to have lower package volumes per stop compared to commercial zones, leading to increased delivery time and fuel consumption. Navigating through residential neighborhoods can be more time-consuming due to narrower streets, traffic congestion, and the presence of obstacles like parked cars and pedestrians.

Additionally, the delivery window for residential locations can be wider, with recipients not always being available during standard business hours, requiring carriers to make multiple delivery attempts or evening deliveries.

All these factors increase operational costs for carriers, making it essential for them to charge residential surcharges to offset the additional expenses.

How Much Is FedEx Residential Surcharge 2023?

Here are two tables displaying FedEx's surcharge prices for pickup and delivery in residential areas.

Shipments picked up at a home or private residence, including locations where a business is operated from a home, incur a residential pickup charge in addition to all other applicable charges

FedEx Residential Surcharge—Delivery

What Is FedEx Residential Surcharge?

The FedEx Residential Surcharge is an additional fee that FedEx charges for the delivery of packages to residential addresses.

FedEx applies the residential surcharge to shipments addressed to a home or private residence. This includes places where a business operates from home and any shipment where the shipper has specified a home as the delivery address.

As shown in the tables above, the specific residential surcharge amount can vary depending on several factors, including your location, the FedEx service you're using, and the terms of your shipping agreement with FedEx. Make sure to periodically check FedEx’s Additional Shipping Fees page for the latest info on their surcharges.

How Do I Avoid FedEx Residential Surcharge?

Here are some tips to help you avoid paying the FedEx residential delivery surcharge.

1. Use a commercial address: If possible, use a commercial or business address for your shipments rather than a residential one.
2. Use the FedEx Hold at Location service: Choose the FedEx Hold for Pickup option when ordering your shipment. This allows you to have your package held at a FedEx location or a nearby store like Walgreens or Dollar General.
3. Negotiate with FedEx: If you are a high-volume shipper or have a shipping contract with FedEx, you can try negotiating your contract terms to reduce or eliminate the residential surcharge.
4. Stay informed about FedEx surcharges: Check the current FedEx rates and surcharge information on their website or contact FedEx directly to stay updated on their policies and surcharge rates. This can help you tailor your shipments in a way to minimize the residential surcharge, among other fees.
5. Use FedEx Ground Economy: Consider using FedEx Ground Economy (formerly FedEx SmartPost), a service that partners with the United States Postal Service (USPS) for the last-mile delivery to residential addresses. We didn’t find a residential surcharge in the surcharge list for this service.
6. Accurately classify the recipient address: Use address validation tools to determine whether the recipient address is commercial or residential. For instance, you can integrate FedEx’s Address Validation API into your company's shipping software.
7. Change delivery preferences: When ordering online, you might have the option to specify delivery preferences. Some retailers offer alternative delivery locations, such as pickup points or lockers, which can help you avoid residential surcharges.

Why Does FedEx Charge More for Residential Delivery?

FedEx, like other shipping carriers, often charges more for residential delivery compared to commercial delivery for several reasons, such as:

• Increased complexity: Residential areas may have narrower streets, limited parking, and various types of dwellings, such as houses, apartments, and condominiums. These factors can make residential deliveries more challenging, requiring extra effort and resources.
• Volume and density: Unlike commercial deliveries, residential deliveries often involve more stops across a wider distance and fewer packages per stop, making the service more costly overall.
• Risk factor: Carriers may consider residential deliveries to be riskier due to the potential for packages to be stolen or damaged when left at a doorstep, leading to higher insurance and liability costs.
• Redelivery and address corrections: Residential deliveries are more likely to result in address corrections or failed delivery attempts, which incur additional costs for the carrier. For example, a recipient may not be at home, leading to a need for redelivery or package holding at a nearby facility.

How ShipSigma Can Help

Avoiding surcharges is great, but lower shipping rates across the board are even better! When you partner with ShipSigma, you get a team with over 250 years of industry experience, utilizing proprietary AI software to get you lower rates, no matter your preferred carrier or service level.

We've already delivered an average cost savings of 25% for over 300 satisfied customers, and now it's your turn. Reach out to us today.