Peak season is hectic for everyone. Shipping volumes skyrocket, deadlines tighten, and surcharges become a real headache. If you’re not prepared, these extra fees can quickly eat into your margins. But with the right data, you can manage these surcharges and keep your shipping costs under control.
Peak season is becoming more expensive than ever, and understanding these changes is crucial. This year, we saw FedEx and UPS extend their peak season surcharges, even with a shorter holiday window. Costs will add up quickly without a solid plan.
By spreading shipments, using multiple carriers, or negotiating early you can minimize the impact and better manage your costs. The following best practices help you manage peak season surcharges efficiently and spend less money.
Start early and be proactive
One of the biggest mistakes companies make is waiting too long to prepare. “If you wait until the last minute, you'll be reacting to surcharges rather than planning for them. Historical data from previous years is a great way to forecast where surcharges will hit,” says Shin Thu San, who leads Product at Loop.
Using your past shipping data empowers you to negotiate discounts where they have the most value (high-cost accessorials, package types, zones, etc.) before peak season begins.
It’s not about eliminating surcharges entirely but using data strategically to reduce their impact. Get ahead of the game by negotiating early and using your data to show where surcharges hurt you most. The earlier you act, the better your leverage.
Optimize shipping to minimize surcharges
Here’s how you can minimize the impact:
- Rethink shipment size and frequency: Break large boxes into smaller, more manageable packages to avoid oversized or large-package fees. Spreading out your dimensional volume instead of sending everything at once can also reduce volume-based surcharges.
- Use multiple carriers: Don't put all your eggs in one basket. Split your shipments between carriers to get the best rates and avoid getting hit too hard by one carrier’s surcharges. Maybe FedEx has better rates for certain routes, while UPS is cheaper for international deliveries. By using both, you can take advantage of each carrier’s strengths and avoid getting hit too hard by one provider’s fees. Use intelligent scenario planning to help you make these decisions.
- Adjust modes: If you have multiple parcel shipments going between the same origin and destination, can they qualify for a minimum LTL charge? Finding where you have repetition in your network can help you find consolidation areas.
Data is your best defense
Technology, and the data it’s able to surface, is your ally during peak season. With great data, you can instantly see where surcharges are spiking and adjust accordingly. This is where great analytics platforms separate themselves from the pack - great platforms are proactive and timely.
For example, if one carrier suddenly raises its fees, Loop can flag that change. You can quickly shift your volume to another carrier with lower costs. Without automation and centralized data, this would take longer and cost more since you don’t have visibility across your entire network.
With standardized data, you can easily understand accessorial fees, service-level costs, package types, and lane-level expenses across different carriers. Loop helps you manage and analyze this data and ensures you have the insights needed to make smarter decisions and keep costs down.
Turn data into your secret weapon
Your shipping data from past peak seasons is a goldmine. Use that information to plan ahead.
Was there a week when fees spiked? Did certain routes cost more than others? Knowing these details lets you adjust shipments and negotiate better terms before peak season starts. For one Loop customer, $58,000 in surprise surcharges appeared after a vendor changed their packaging. With Loop, they were able to spot the issue quickly, fix it, and stop the extra surcharges.
Data isn’t just for retroactive analysis. It allows you to be proactive and adjust in real time, keeping you ahead of surcharges.
Strategy beats chaos every time
Peak season doesn’t have to be stressful. With the right planning, data, and tools, you can stay on top of surcharges and keep costs under control.
Want more tips on how to use AI and automation to your advantage? Check out our guide on Making sense of AI in a rapidly evolving supply chain.
