How to Find Out If You Are Overpaying for Shipping

You are probably overpaying for shipping if no one has re-rated your last six to twelve months of shipments against your contract and against alternative carriers. A free PLD analysis from ShipTrac does that with your parcel-level data and returns a number, not a sales call.

Key Takeaways

Overpaying for shipping usually comes from three places: a rate card that no longer fits your parcel profile, surcharges and dimensional weight nobody is tracking, and invoice errors nobody is checking.
UPS and FedEx each announced an average 5.9% general rate increase for 2025, but what that does to your account depends on your discounts and surcharge schedule, so only your own data gives the real figure.
A parcel-level data (PLD) analysis re-rates your actual shipments by weight, zone, service and surcharge against alternative carrier mixes, and tells you the gap in your own numbers.
ShipTrac's free PLD analysis returns a quantified answer; savings of up to 30% are possible, but only after the analysis, and they depend on your carrier mix, zones and parcel profile.
If you ship through a 3PL, check how the 3PL bills you for postage and handling as well, because overcharges can sit in the invoice rather than in the rate.

Signs You Are Overpaying

You do not need a consultant to get a first read. If two or three of these are true, assume there is a gap and go measure it.

Your rates predate your current volume or parcel mix. A contract signed when you shipped heavier boxes, or far fewer of them, was priced for a different business.
Cost per parcel is rising faster than your average weight or zone. If volume is flat and the invoice is not, something other than your shipping behaviour is moving.
Surcharges are a growing share of the invoice. Residential, delivery area, additional handling and fuel lines are negotiated separately from the headline discount.
One carrier ships everything. Light, short-zone residential parcels and heavy cross-country boxes rarely belong on the same rate card.
Nobody files claims or checks service-failure credits. Lost parcels and late deliveries that never get claimed are money you already paid.
You cannot state your delivered cost per order by zone. If you cannot, you cannot tell a good rate from a bad one.

Where the Money Leaks

Dimensional weight

Worth knowing

UPS and FedEx both use a divisor of 139 for domestic dimensional weight. A 12 x 10 x 8 inch box is 960 cubic inches, and 960 / 139 is 6.9, so you are billed for 7 lb on a parcel that weighs 3 lb, more than double the scale weight.

As of the 2025 carrier rate guides, UPS and FedEx both use a divisor of 139 for domestic dimensional weight on daily (commercial) rates. Take a 12 x 10 x 8 inch box that weighs 3 lb. That is 960 cubic inches, and 960 / 139 is 6.9, so you are billed for 7 lb, more than double the scale weight. Over-sized cartons and void fill show up here first, and the carrier invoice will not flag it for you.

Run this first

Compare billed weight with actual weight on your 50 largest parcels by cost. The gap is your dimensional-weight exposure, and it takes one sort.

5.9%Average general rate increase announced by UPS and FedEx for 2025, published September 2024. Your rate card moved whether or not you renegotiated.

General rate increases

UPS and FedEx each announced an average 5.9% general rate increase for 2025, in September 2024. That is an average on published rates. Your exposure depends on your discount tiers and on which accessorials rose. The quick arithmetic is annual parcels x your average label cost x 0.059, which gives you a ceiling to sanity-check against what you actually saw. If your invoices moved by more than that, look at surcharges first.

Service and carrier mix

Paying for a faster service level than the customer was promised is a common leak. So is sending every parcel through the one carrier you negotiated with, when part of your volume would price better elsewhere. This is where the answer is "it depends on your carrier mix": the gap comes from the combination of weight bands, zones, residential share and service levels, not from any single rate.

Invoice errors

Weight and dimension corrections, duplicate charges and surcharges applied to the wrong address type all land on the invoice as lines that look plausible. Without a check at the tracking-number level, they get paid.

Costly mistake

Established brands that feel nickel-and-dimed by a 3PL are usually reacting to exactly this: not one big overcharge, but billing errors that cost them revenue as well.

Where it leaks	What causes it	How you spot it
Dimensional weight	Over-sized cartons and void fill	Billed weight above actual weight
General rate increases	An average 5.9% for 2025, applied unevenly	Cost per parcel rising faster than average weight
Service and carrier mix	Paying for speed the customer was never promised	Air on shipments with no deadline
Invoice errors	Wrong address type, duplicate charges, surcharges	Invoice lines that look plausible until checked

A One-Afternoon Check You Can Run Yourself

Export 12 months of shipment-level data from your carrier portals or your order system. Use a full year if your volume is seasonal.
Calculate cost per parcel by zone and weight band, and plot it month by month.
Work out surcharges as a share of total spend, split by type.
Compare billed weight with actual weight on your 50 largest parcels by cost.
Pull 20 invoice lines at random and match each to its tracking number, service level and address type.

This tells you whether you have a problem. It does not tell you what a different carrier mix would cost, because that needs other carriers' rates applied to your actual parcels. That second step is what a PLD analysis does.

What a Free PLD Analysis Returns

Parcel-level data is the shipment-by-shipment record of what you sent and what it cost. ShipTrac's RateTrac starts with a free PLD analysis built on that export. We re-rate your parcels against alternative carrier mixes, including carriers reachable through ShipTrac's collective volume, such as Uni Uni and Amazon Shipping, and return the difference as a number you can check against your own invoices.

Here is the honest version of what that number means:

Up to 30% is the ceiling we work within, and only after the analysis. It is not a promise and it is not an average.
It can come back small. If your contract, mix and invoices already fit your parcel profile, the analysis will say so.
It depends on four things: your weight distribution, your zone distribution, your residential share and the service levels you use.

If the number is worth acting on, RateTrac is how you access ShipTrac's enterprise-level rates through collective volume. If it is not, you have lost an afternoon and gained a benchmark. We are a team of operators who have negotiated with carriers, and we would rather tell you your rates are fine than sell you a switch you do not need.

Overpaying Through Your 3PL's Billing

If a 3PL ships for you, the carrier rate is only half of the question. Ask for carrier charges passed through at the tracking-number level, with the markup shown as its own line. If you receive one blended "shipping" figure per order, you cannot tell whether the rate, the markup or a carrier adjustment moved. Established brands that feel nickel-and-dimed by a 3PL are usually reacting to exactly this: not one big overcharge, but lines they cannot reconcile.

The fix is not to distrust your 3PL. A good one wants the same visibility, because billing errors cost them revenue as well.

What 3PL Billing Automation Does

If you run a 3PL, you are on the other side of this invoice. So, what is 3PL billing automation? It is software that builds client invoices from reconciled data instead of spreadsheets. Carrier charges are ingested, matched to tracking numbers, marked up under your rules and issued to the client with the checking already done. The 3PL automated invoice that results can be traced line by line, which makes disputes shorter and leakage visible.

How to automate 3PL billing

Bring carrier invoices into one system automatically rather than downloading and re-keying them.
Reconcile each charge to a tracking number, so duplicates and weight corrections surface.
Apply markup rules by client, carrier, service and weight band. Check whether your WMS billing module can express the rules you actually use.
Flag disputes and adjustments before the client invoice goes out, not after.
Capture billable activity that never reaches an invoice, such as handling and storage events.

Evaluating 3PL billing automation software

When you compare 3PL billing automation software, ask whether it reconciles at the tracking-number level, whether its markup logic goes beyond a flat percentage, and what happens to a disputed line. Automated billing for 3PL operations is only as good as the data it reconciles against.

FinTrac is ShipTrac's product for 3PLs. It handles automated invoice ingestion and reconciliation, with markup flexibility beyond what a WMS billing module offers. Metering of billable activity, to stop revenue leakage at the source, is planned and not yet available, so step five above remains a manual process for now.

Where to Start

Run the afternoon check first, because it costs nothing and tells you whether to worry. Then send your shipment export for the free PLD analysis, so you have a number from your own parcels to decide on. If you are a 3PL owner and the invoice side is where the hours go, start with FinTrac.

See what your own data says

A free PLD analysis re-rates your actual shipments against your contract and alternative carriers, and returns the difference as a number. Not a sales call.

Request a free PLD analysis

Frequently asked questions

How do I know if I am overpaying for shipping?

Compare your cost per parcel by zone and weight band over the last year, check what share of your invoice is surcharges, and spot-check invoice lines against tracking numbers. If you cannot explain the trend, or no one has re-rated your data against other carriers, you probably have a gap. A PLD analysis puts a number on it.

What do I need for a free PLD analysis?

A shipment-level export covering six to twelve months, ideally a full year if your volume is seasonal: weight, dimensions, origin and destination, service level, and charges by line. The analysis re-rates those parcels against alternative carrier mixes and returns your potential gap as a number. Savings of up to 30% are possible, but only the analysis can say whether they apply to you.

What is 3PL billing automation?

It is software that builds client invoices from reconciled data instead of spreadsheets: carrier charges are ingested and matched at the tracking-number level, markup rules are applied, and the 3PL automated invoice goes out with the charges already checked. It targets revenue leakage, where costs you incurred never reach the client's bill.

How do you automate 3PL billing?

Start by getting carrier invoices into one system automatically, then reconcile each charge to a tracking number, apply markup rules by client, carrier and service, and flag disputes before invoicing. FinTrac handles ingestion, reconciliation and markup flexibility today; metering of billable activity is planned and not yet available.

Will a PLD analysis always find savings?

No. If your carrier mix, rates and invoices are already well matched to your parcel profile, the analysis may find little, and it will tell you that. What you pay depends on weight, zones, residential share and service levels. Up to 30% is the ceiling we work within, and it applies only after the analysis.