The Truth Behind High Shipping Costs: What’s Driving the Price?

If you’ve asked yourself lately, “Why is shipping so expensive?”, you’re far from alone. Whether you’re a business owner trying to manage e-commerce logistics or a shopper surprised by checkout fees, the rising cost of shipping has become a shared frustration. The truth is, there’s no single reason—it’s a combination of global issues, local logistics, and changing customer expectations.

Let’s break down what’s really driving those high shipping prices and what you can do about them.

Fuel Prices Are a Big Part of the Answer

One of the main reasons why shipping is so expensive comes down to fuel. Shipping anything—whether across the country or around the world—depends on fuel, and when diesel or gas prices go up, carriers increase their rates. These costs don’t stay with the shipping company—they’re passed on to the sender and eventually to the customer.

Worker Shortages Are Driving Up Costs

Another answer to why is shipping so expensive today? A lack of people. Truck drivers, warehouse staff, delivery workers—there just aren’t enough of them. To attract and keep workers, companies are raising wages, offering bonuses, and increasing benefits. All of that means higher costs, which again, are reflected in what customers pay for shipping.

Global Supply Chains Are Still a Mess

Even post-pandemic, global shipping is far from smooth. Port congestion, delays, and a shortage of containers have caused ripple effects across the industry. Every delay adds cost—storage fees, rerouting, and time lost. And those costs inevitably show up in the final shipping bill.

The Last Mile Is the Most Expensive

What’s called “last-mile delivery”—the final step from a hub to your door—is one of the most expensive parts of shipping. Traffic, route planning, remote addresses, and fast delivery expectations all make last-mile logistics a challenge. It’s a big reason why shipping is so expensive, especially for next-day or rural deliveries.

Dimensional Weight Pricing Adds Up

Shipping carriers now calculate prices using dimensional weight, meaning they charge based on how much space a package takes up, not just how heavy it is. So, a large but light item can cost more to ship than a small, heavy one. For online retailers shipping clothing, home goods, or lightweight items, this shift has had a major impact on cost.

Expectations Have Changed—And That’s Costly

Thanks to Amazon and other big retailers, customers expect fast, cheap, or even free shipping. But small and mid-sized businesses can’t absorb those costs as easily. To stay competitive, many either raise product prices or take a loss on shipping—neither of which is sustainable in the long term.

How to Deal With High Shipping Costs

You might not be able to change global shipping rates, but you can take a few steps to manage the impact:

• Use regional couriers for local deliveries—they’re often cheaper than national services.
• Consolidate shipments to reduce frequency and cost per package.
• Explore third-party logistics (3PL) providers that offer discounted rates through volume.
• Offer local pickup or delivery lockers to cut last-mile expenses.

Some Canadian sellers are turning to fulfillment partners that help streamline shipping operations and secure better carrier rates. Here’s one option they’re using to reduce costs.