How peak season surcharges impact shipping costs
A peak season surcharge can turn an ordinary freight bill into a costly surprise.
Applied by carriers during periods of high demand, these temporary fees are designed to manage congestion and balance capacity.
But for many businesses, this can mean higher landed costs and disrupted operations.
Peak season surcharges are common in the weeks leading up to big retail events, such as Black Friday, Cyber Monday, and Christmas.
They can add hundreds or even thousands of dollars to a single shipment. Multiply that across several containers, and the financial impact becomes hard to ignore.
Knowing when surcharges apply and how they impact shipping decisions is key to keeping goods moving and costs under control.
What is a peak season surcharge?
A peak season surcharge (PSS) is an additional fee that carriers may apply when cargo demand exceeds available capacity.
It’s not a fixed cost included in freight rates. Instead, it’s a temporary charge carriers apply to balance supply and demand during busy periods.
Peak season surcharges are most common in ocean freight.
However, air freight can also be subject to seasonal surcharges when capacity is limited, and trucking providers sometimes apply them during peak retail and holiday seasons.
What makes PSS challenging is its unpredictability. Carriers may announce them on short notice, leaving businesses with little time to adjust.
While the charge is temporary, it can significantly impact total shipping costs during critical periods when businesses are moving their highest volumes of goods.
Examples of when PSS may apply
Peak season surcharges are most common in the final quarter of the year, but they aren’t limited to the holiday rush. Some common scenarios include:
- Holiday retail imports surge in the weeks leading up to Black Friday, Cyber Monday, and Christmas as retailers stock their shelves for the busiest shopping period of the year.
- Back-to-school season can drive higher shipping volumes of apparel, electronics, and school supplies.
- Chinese New Year triggers one of the largest freight surges as factories in Asia close for several weeks and exporters rush to ship goods ahead of the holiday.
- Supply chain disruptions, such as congestion, labour strikes, natural disasters, or geopolitical events, reduce available capacity and can prompt carriers to add surcharges.
The impact of peak season surcharges on shipping
Peak season surcharges affect both the economics and logistics of importing.
They can impact how much your business spends, how reliably you can plan, and how competitive you can remain in your markets. Their effects are felt across several areas of operations:
Higher landed costs
Peak season surcharges add directly to freight bills. If you’re moving multiple containers, these charges can quickly escalate into thousands of dollars, which could reduce your profit margins and strain your cash flow.
Budget unpredictability
Carriers often announce surcharges on short notice. This can make it difficult for you to accurately forecast shipping expenses or adjust your pricing strategies in time.
Competitive pressure
If you leave planning until the last minute, you may face both higher costs and slower delivery, which puts you at a disadvantage in competitive markets. Importers who book space early and plan with a freight forwarder are often better positioned to avoid the highest surcharges or shipment delays.
Operational disruption
Peak season surcharges can change the normal flow of your shipments. Higher costs during busy periods may require adjustments to shipping timing, changes in order volumes, or addressing congestion in your supply chains.
Do peak season surcharges affect value for duty?
For Canadian businesses, whether a peak season surcharge is included in the value for duty depends on its connection to the place of direct shipment.
This is the last place outside Canada from which the goods are shipped directly to Canada.
- If the PSS is part of the transportation costs before the place of direct shipment to Canada, it must be included in the value for duty.
- If the PSS applies to the transportation costs after the place of direct shipment, it is not included in the value for duty.
How to plan for and manage the impact
Peak season surcharges cannot be avoided entirely, but you can reduce their impact on your business with early planning and the right support. Steps to take include:
Booking early
Securing space ahead of the busiest shipping windows is one of the simplest ways to limit exposure to peak season charges.
Forecasting costs
Including potential surcharges in landed cost calculations keeps your budgets realistic and helps avoid unpleasant surprises.
Monitoring carrier announcements
Because carriers often release surcharge notices on short notice, staying informed allows you to quickly adapt your shipping and financial plans.
Working with a freight forwarder
Freight forwarders track market conditions daily and can provide alternative routing options. Relying on their expertise can help you navigate surcharge periods with fewer disruptions.
How Cole International can help
When peak season surcharges hit, unplanned costs and shipping delays can disrupt even the most well-planned supply chains. That’s where we come in.
At Cole International, we provide freight forwarding solutions to help businesses like yours manage seasonal surcharges and keep your goods moving.
Our team can work with you to:
- Monitor carrier announcements and keep you informed of surcharge changes
- Secure space in advance to reduce exposure to the highest fees
- Recommend shipment strategies that balance cost and timing
- Keep your freight moving smoothly even during the busiest times of year
Our goal is to help you ship your goods smarter and faster.
Reach out to one of our trade professionals to discuss how we can help you manage costs, secure space, and keep your freight moving on schedule, even during peak seasons.
