High gas prices hit everyone, even if you don’t drive.
- The cost to ship goods has increased with fuel prices, and online retailers and delivery services are passing those costs onto customers.
- Shoppers may see fuel surcharges, higher shipping costs, and/or increased product prices as retailers react.
- It may be worthwhile to weigh the cost to pick up your purchases in person versus higher shipping fees.
For the first time in years, drivers are hitting the road in droves. Many are back to the office and their daily commute, and summer travel is kicking into gear. But all that driving is going to be quite a bit more expensive than it was pre-pandemic (or even last year).
Indeed, the national average for a gallon of gas is now over $5 according to AAA — and some states are well past that mark. That’s more than twice as high as it was in 2019, and about $2 more than this time last year.
That increase has led to many companies that rely on contracted drivers to add extra charges to help offset costs. You’ll see this anytime you order local delivery or grab a rideshare, as Uber, Lyft, even Instacart have all added extra fees in the name of combating higher gas prices. Many restaurants with on-staff drivers have also added their own fuel surcharges.
Fuel price increases mean delivery costs have risen
As if prices at the pump weren’t bad enough, however, the rising cost of fuel is hitting many of us at home, too. Higher fuel prices mean shipping costs are rising, and retailers are passing those costs onto customers.
UPS charges, for instance, have gone up significantly this year. The international shipper’s fuel surcharges have jumped 3 percentage points since March. It now sits at 18% for ground shipping, the highest it’s been in the last 90 days.
In response to increased costs, some online retailers have increased shipping prices, as well as specific gas surcharges being tacked onto some orders. And, as gas prices continue to climb, fuel-related delivery surcharges could become common for smaller retailers who simply can’t afford to eat the cost of higher delivery fees.
However, it’s not just the little guys. Even retail giant Amazon, which has a major contract with USPS, not to mention its own fleet of delivery vehicles, has had to contend with higher shipping costs.
Someone pays, somewhere
Of course, you can’t assume you’re safe just because you don’t see a gas-specific charge. When retailers pay more — so do customers. If the shipping price isn’t higher, the item price likely will be.
For example, Amazon recently hit sellers with a 5% “fuel and inflation” surcharge on its fulfillment service. This applies to any sellers that say “Fulfilled by Amazon.” Since many of these items ship free with Prime, the only way a seller can offset the cost is by raising the price of the item itself.
So, while your Prime deliveries are still free, your purchase price has probably gone up. And the same is likely true at major retailers across the board. Anywhere that maintains its free shipping policies will make up the difference somewhereand jacking up prices is usually the simplest solution.
Picking up your purchases may make more sense
While you don’t have much recourse for higher product prices — other than being a more diligent comparison shopper — increased delivery fees may have a workaround: pick up orders.
Many major retailers offer the option to order online, then pick up your purchase in the store. Depending on the delivery fee (and your vehicle’s gas mileage or public transit costs), it may make more sense to swing by the store to grab your order. This applies to retail purchases, as well as restaurant and grocery orders.
And, if you don’t already have a good gas rewards credit card, now may be the time to add one to your wallet. Earning an extra 3% to 5% back on gas won’t get you back to 2019 prices, but it can certainly help make your gas budget go a little further.
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