Shipping costs are eating into margins across every industry, and most companies don’t even realize it. Whether your business ships through FedEx, UPS, or regional carriers, hidden fees and unoptimized contracts can quietly inflate logistics costs by double digits.
The truth is, most organizations aren’t paying for what they use. They’re paying for inefficiency.
Here are the 10 most common reasons businesses overpay for shipping, and how to take control of your logistics spend through smarter procurement practices and better carrier management.
Contracts with FedEx, UPS, or other carriers often auto-renew with outdated rates, surcharges, and minimum charges. Over time, those hidden terms add up.
Fix: Conduct a contract performance review every 12–18 months. Consider using a procurement advisor who can help you renegotiate carrier contracts, eliminate unnecessary clauses, and align rates with actual shipping volumes.
Shipping markets fluctuate constantly due to fuel costs, inflation, and capacity changes. Without benchmarking, your “discounted” FedEx or UPS rates could be well above market average.
Fix: Use external data and procurement insights to compare carrier pricing across industries. Real-time benchmarking intelligence can help ensure that carrier agreements stay competitive.
Carriers like FedEx and UPS charge by dimensional (DIM) weight, not just actual weight. A lightweight box that takes up space on a truck can cost more than a heavier one.
Fix: Optimize packaging. Standardize box sizes and use packing software that calculates the most cost-efficient option per shipment.
Multiple small shipments to the same destination drastically increase per-package costs.
Fix: Consolidate orders and shipments whenever possible. Procurement teams can coordinate fulfillment to reduce total loads and minimize accessorial fees.
Residential delivery fees, address corrections, Saturday deliveries, these “extras” can account for 15–25% of total invoice costs if not managed.
Fix: Audit shipping invoices monthly to identify recurring surcharges. Audits can help uncover these hidden costs and negotiate reductions with carriers.
Without visibility into key shipping metrics: spend by zone, carrier performance, or package weight, you can’t optimize your network.
Fix: Use analytics to pinpoint inefficiencies and opportunities for contract renegotiation. Procurement advisors can help translate that data into measurable savings.
Many businesses sign multi-year contracts with FedEx, UPS, or other carriers, but never review how those carriers actually perform. Over time, service issues, late deliveries, or hidden rate escalations can quietly erode value. Without annual performance reviews, companies lose leverage and miss opportunities to renegotiate better terms.
Fix: Conduct annual carrier performance reviews that evaluate on-time rates, surcharge trends, and customer support responsiveness.
Manual rate lookups and outdated systems lead to higher spend and slower fulfillment.
Fix: Implement a Transportation Management System (TMS) or partner with a procurement advisor that provides rate optimization tools. Technology-driven sourcing ensures you always ship at the lowest available rate.
Fuel surcharges fluctuate weekly, and some carriers apply blanket rates that don’t match your routes or shipping profiles.
Fix: Audit your invoices for incorrect fuel applications. Consider using logistics specialists who can help analyze surcharge data and push for adjustments that reflect real-world shipping behavior.
Shipping is often treated as an operational function, not a procurement category. That’s where opportunities are lost.
Fix: Treat logistics as a strategic spend category. Consider partnering with a procurement advisor this will give you access to carrier insights, rate benchmarking, contract optimization, and renegotiation services, without adding headcount or internal complexity.
At CenterPoint Group, we help organizations uncover hidden shipping inefficiencies and secure better rates across FedEx, UPS, and other major carriers. Our approach combines data-driven insights, expert contract renegotiation, and category-specific benchmarking to deliver measurable savings.
We focus on:
By applying procurement discipline to logistics, CenterPoint Group helps businesses move beyond reactive cost management, turning shipping into a competitive advantage.
Shipping costs aren’t static. They shift with market conditions, carrier demand, and contract terms, often in ways businesses don’t notice until it’s too late. With strategic procurement, real-time benchmarking, and expert contract management, you can reduce costs, improve visibility, and reclaim control of one of your most overlooked spend categories.
CenterPoint Group can help you do exactly that.