How to Audit Your FedEx and UPS Bills to Maximize Profit in Your Retail Shipping Store
Running a retail shipping store means you’re constantly balancing customer satisfaction with profitability. One of the biggest factors that directly impacts your margins is your FedEx and UPS carrier billing. While these carriers provide powerful tools and services, their billing systems are complex — and mistakes or missed opportunities for savings happen more often than you might think. That’s why auditing your carrier invoices is a must if you want to protect your bottom line and make the most profit per shipment.
Here’s how to get started:
1. Review for Billing Errors
Carrier invoices are highly detailed and often confusing, but errors do occur. Some common ones include:
Incorrect weights or dimensions being billed.
Residential surcharges applied when the address was actually commercial.
Duplicate charges for the same shipment.
Fuel surcharges calculated incorrectly.
Action Step: Cross-check package dimensions and weights from your POS system against what FedEx or UPS billed. Even small discrepancies add up fast.
2. Check for Guaranteed Service Refunds (GSRs)
FedEx and UPS both offer service guarantees: if a package arrives late, even by a few minutes, you may be eligible for a refund of the shipping charges. However, these refunds aren’t automatic — you must request them.
Action Step: Audit your delivery records regularly and file for refunds on late deliveries. Many third-party audit services exist that can help automate this process if you don’t have the time to manage it in-house.
3. Understand Surcharges and Accessorial Fees
Surcharges like fuel, address corrections, additional handling, and residential delivery can eat into your profits. Often, customers don’t realize how many of these fees are tacked on after the fact.
Action Step: Review which surcharges are showing up most frequently on your bills. Then, consider adjusting your retail shipping prices to better account for these “hidden” costs so you don’t lose margin.
4. Reconcile Retail Rates vs. Costs
Every package you ship should have a clear margin between what you charge the customer and what you pay the carrier. By reconciling your invoices with your retail sales data, you’ll know exactly how much profit you’re making per package — and where you may be undercharging.
Action Step: Run monthly reports to compare customer-paid shipping revenue vs. your carrier costs. Identify services or package types that consistently yield low margins and consider adjusting your pricing.
5. Use Technology to Automate Audits
Manually checking every line item is time-consuming. Thankfully, there are software tools and third-party services designed to automate carrier audits. These tools can flag billing errors, late deliveries, and overcharges, saving you time and ensuring you recover every dollar you’re owed.
Final Thoughts
Auditing your FedEx and UPS bills isn’t just about catching mistakes — it’s about protecting your store’s profitability. By checking invoices regularly, monitoring surcharges, and reconciling your margins, you’ll ensure that every shipment contributes to your bottom line. In a competitive retail shipping environment, these small details can make a big difference in your success.
