Minimizing Address Correction Charges

by LJM Group

Address Correction charges continue to be a thorn in the side for many companies. The rules seem to vary from shipper to shipper and often, from week to week, depending on the circumstances. As you know, if a package incurs an address correction fee, the guaranteed delivery time is no longer in play. Could there be a correlation?

If the carriers make a minimal change to the address, you can expect an additional charge to be assessed to your package. One example we saw recently was when a shipper wrote out the word “Drive” in the address field, and one of the two big carriers assessed them for an address correction fee correcting it to “DR”.

What is an Address Correction? It’s an accessorial fee issued by the carriers for shipments in which your ship-to-address does not match what FedEx and UPS determine it should be. Not only does your address need to be exact, it must also be in the format the carriers require. Example, do not put a suite number or apartment number on the same line as the street address; this will cost you up to $15.90 per box; if you ship multiple packages to the same “bad” address, you will be charged for the first seven boxes at $15.90 per ($15.90 X 7 = $111.30).

The address correction charge increases every year. UPS increased their address correction charge from $13.40 per package in 2017 to $15.90 in 2018 and FedEx increased their address correction charge from $14.00 in 2017 to $15.00 in 2018. This is a significant amount considering the address correction fee may total more than the actual package itself. This is a huge profit center for the carriers.

Here are some ways to mitigate some of these egregious address correction charges.

  1. When you incur an address correction charge, be proactive and make the necessary changes in your systems to the address using the adjustment provided by the carrier. This will ensure it does not happen over and over.
  2. The carriers recommend you always abbreviate any directional or street type portion of the address in your systems. (N, S, E, W and RD, LN, BLVD, ST, etc.). If not abbreviated, carrier systems can read them as part of the actual street name, which will then lead to an address correction charge.
  3. Invest in address hygiene software which will help clean the address prior to shipping and save you a bundle of money and will allow you to claim a refund if the shipment is delivered late.
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