Discover how shipping costs are shifting and why your 2025 budget may already be at risk

Wouldn’t it be nice to go back to when shipping used to be more predictable? You could negotiate your contract, lock in your carrier rates, and account for the surcharges that would accompany peak holiday season. Unfortunately, this is no longer the reality.


The shipping costs we see today are determined by a combination of factors like annual general rate increases (GRIs), fluctuating surcharges, and a never-ending list of accessorial fees. And not only are carriers charging higher prices, but they’ve gotten more strategic at it – quietly increasing fees and adjusting existing ones. This makes it challenging for shippers to anticipate and budget for what their total costs might be.


While some shippers may still be hyper focused on managing increasing costs during the peak holiday season, the truth is that most of these rising costs are taking place long before and after the holiday season. For shippers to stay competitive, it’s key to understand that rate hikes are no longer confined by the season. This means shippers must redefine their strategies to consider a year-round approach when it comes to managing shipping costs.

Breaking Down the 2025 GRIs 

Each year, shippers wait in anticipation for the major carriers to announce their GRIs, and as predicted, 2025 would bring another year of rising shipping costs. Taking effect in late December of 2024, UPS led the charge with a 5.9% average net increase, followed shortly thereafter by FedEx implementing the same on January 6th of this year. While not ideal, this figure may seem manageable at first. However, these GRIs are averages, meaning other service levels, zones, and package types could encounter even higher increases.


As mentioned previously, we know that shipping costs can fluctuate at any time throughout the year, so it should come as no surprise the United States Postal Service (USPS) has recently announced their mid-year price increases. Taking effect on July 13th, 2025, these include:

  • 6.3% increase for Priority Mail services
  • 7.1% increase for Ground Advantage
  • 7.6% increase for Parcel Select

FedEx will also introduce additional rate changes throughout the upcoming months, including:

  • Changes to FedEx One Rate pricing for Express Saver and 2Day services, effective July 14th, 2025
  • New pricing structures for parcel pickups in the U.S. and Canada, effective August 18th, 2025

While it is important to be aware of incoming rate increases, it is challenging to determine the actual impact as some of these increases exceed well beyond the advertised percentage. This can especially impact shippers who move large, bulky items, as well as those shipping to residential areas. Therefore, it is crucial that businesses have the agility and flexibility to navigate these complexities – without it, they will continue to feel the financial impact. GRIs can no longer be taken at face value.

Bracing for Impact: Surcharges 

Previously, the peak holiday season was the main time shippers endured significant surcharges. However, today the most costly shipping changes are happening year-round – and often without much notice. Some of the surcharges we’re seeing major carriers implementing are:

  • Fuel Surcharges: additional costs to cover fluctuating fuel prices 
  • Residential Delivery Surcharges: applied to residential packages as delivering to residential areas can be more complex 
  • Delivery Area Surcharges: applied to deliveries going to remote or less accessible locations 
  • Additional Handling Surcharges: for packages requiring any extra handling 
  • Oversize/Large Package Fees: additional costs for packages heavier than the standard size or weight limits set by the carrier 
  • Address Correction Fees: charged for incorrect or incomplete shipping addresses 

Unlike GRI’s, surcharges are updated frequently and quietly, making them especially challenging to manage. Additionally, surcharges can stack on top of each other, meaning one shipment can endure several fees. Without clear visibility into these fees at the time of label creation, shippers risk absorbing significant costs after the fact.


In terms of recent surcharges, some changes to highlight include:

As surcharges continue to expand in scope and complexity, businesses must adopt tools and strategies that can help them adapt and account for these frequent shifts. This underscores the importance of real-time visibility, automated technology, and flexible solutions for shippers to maintain cost-effective operations.  

The Cost of Static Shipping Strategies 

It’s clear that the modern logistics landscape is defined by constant, rapid change. For shippers in an industry that’s nothing short of dynamic, their shipping strategy should be too. What may have worked in the past, is not guaranteed to work today and could be costing your business significantly on avoidable fees.


If your business is still reliant on a few or a single carrier, fixed routing guides, or manual decision-making processes, you are likely already falling behind. As carrier rates shift and surcharges build, a static shipping strategy is a major liability. Factors such as real-time carrier rate adjustments, surcharge fluctuations, supply chain disruptions, and capacity issues can go unaccounted for.


That is why today’s shippers must adopt a strategy that can keep up with the quantitative and qualitative changes the industry endures on a monthly – sometimes weekly – basis. It is crucial to move away from outdated tools, rigid processes, and manual workflows, and move towards advanced capabilities like real-time rate shopping, automated business rules, and multi-carrier flexibility, that can help you make smarter, quicker, and more cost-effective decisions.

Take Control with a Multi-Carrier Shipping Software Approach 

To effectively manage this shift, shippers need more than just a change in mindset – they need the right technology in place. Advanced multi-carrier shipping software (MCSS) solutions help businesses manage rising costs, surcharges, and adjustments to carrier rules with ease, bringing their operations the flexibility, automation, and crucial insights needed to thrive in this environment.


That is precisely where an industry leader like Varsity Logistics comes in.

Varsity Logistics: The Powerful Solution for Modern Shippers 

Shipping costs may be far from predictable, but gaining proper control is not out of reach. Varsity’s comprehensive MCSS is the only holistic shipping solution built for the IBM i, designed to help shippers thrive in today’s volatile and unpredictable market. With proven reliability and efficiency, Varsity plays a key role in turning uncertainty into opportunity with smarter, faster, and more cost-effective shipping processes.


As a leading multi-carrier shipping software provider, let’s take a closer look at how Varsity helps shippers stay ahead.


Real-Time Carrier Rate Shopping
Varsity’s powerful ShipSelect module streamlines the carrier selection process by automatically comparing multiple carriers, delivery times, and shipping methods in real-time. This enables shippers to make the most cost-effective choice for each shipment, while considering key factors such as transit time, carrier performance, and service type. By factoring in the latest rates and surcharges, ShipSelect provides the visibility needed to avoid unexpected costs and make smarter decisions. [Discover how Varsity ShipSelect eases carrier selection pain points.]


Configurable Business Rules
Varsity’s platform allows you to implement business rules that fit best with your unique needs. Depending on your operational goals – whether that be cutting costs, meeting promised delivery dates, or avoiding certain surcharges – configurable business rules can help you stay aligned and on track.


Unified Platform for Parcel and Freight
Many other shipping software companies only support either parcel or freight capabilities, forcing businesses who ship both ways to utilize disparate systems. However, Varsity’s platform supports both parcel and less-than-truckload (LTL) under one unified system, streamlining operations and enabling a seamless flow of data. Leveraging Varsity’s platform gives shippers flexibility across shipment types and enables the ability to optimize both cost and performance regardless of the selected mode.


Built to Scale with Your Business
Everything surrounding the logistics landscape can change quickly, and so can your needs. With a comprehensive modular build, powerful IBM i (AS/400) technology integrations, and strong partnerships with all the leading carriers in North America, Varsity can scale and adapt to your evolving needs. From an evolving carrier mix to requirement adjustments and volume increases, Varsity ensures your operations maintain optimal efficiency. [Take a closer look at the modular software suite that powers Varsity’s holistic solution.]


GRIs, surcharges, and constant industry change are unfortunately here to stay, but that doesn’t mean your shipping strategy has to suffer. Using Varsity Logistics advanced shipping software gives businesses the power of visibility, informed decision-making, cost-control, flexibility, and improved operations to thrive.


Ready to take control of your shipping costs and future-proof your logistics strategy? Contact our team of shipping experts or schedule a pressure-free demo to discover how our multi-carrier shipping software can help you stay ahead with confidence.