Size matters; at least when it comes to FedEx shipping charges.
The global delivery company announced it’s lowering the size threshold for packages that are assessed a handling surcharge, according to Internet Retailer.
Currently, FedEx charges customers an extra fee to ship packages that are 60 or more inches long. Starting June 1, you’ll have to fork over more money if you want to ship anything 48 or more inches long.
“We are seeing a significant increase in nontraditional items now being purchased online, mattresses to new swing sets and big-screen TVs just to name a few,” FedEx Executive Vice President Mike Glenn told analysts on a March 16 earnings call, according to a transcript from Seeking Alpha. “We welcome this opportunity but it is important that we price these items accordingly to account for the operational complexities, such as manual sortation to person delivery, et cetera.”
During the earnings call, Glenn also addressed Amazon’s entrance into the shipping and delivery market. Amazon has reportedly purchased a fleet of delivery trucks and is looking into acquiring freighter jets so it can take over the delivery of at least a portion of its orders.
The FedEx executive said that if Amazon does in fact take over the delivery of at least some of its orders, it will have an impact on FedEx revenue, but not a significant one.
“It is important to note that no one FedEx customer represents more than approximately 3 percent of total revenue,” Glenn said. “Additionally, other than the Postal Service, no single customer represents more than approximately 3 percent of revenue for FedEx Express, FedEx Ground, or FedEx Freight. We manage these relationships carefully to ensure we don’t become overly dependent on any one customer.”
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