Everything You Need to Know About The 2023 UPS Rate Increase

Everything You Need to Know About the 2023 UPS Rate Increase

If you rely on UPS for your shipping needs, you may have heard about the recent rate increase announcement for 2023. As of December 27, 2023, the UPS General Rate Increase (GRI), UPS rates will elevate to 6.9%, resulting in changes to UPS shipping costs. Let’s take a closer look at what this means for shippers and what to expect from UPS 2023 rates.

You may recall late last year, in January 2022, when FedEx announced its most recent general rate increase.

What is the UPS GRI?

The UPS GRI is a periodic adjustment to UPS shipping rates that takes place annually. This adjustment typically reflects changes in various factors, such as fuel costs, labor costs, and other operational expenses that UPS incurs in providing shipping services. The UPS GRI is usually announced in advance and has a specific effective date (in this case December 27, 2023), which is when the rate changes take effect.

Understanding the UPS 2023 GRI

The UPS GRI will impact various shipping services, and shippers should be aware of the changes in rates, surcharges, and fees that may apply to their shipments. Knowing as much information as possible before rates increase will help you and your organization potentially mitigate costs, seek alternatives, or negotiate for a better rate. Here are some ways to proactively prepare for the UPS GRI.

Ways to Proactively Manage the UPS GRI

While learning about another general rate increase isn’t usually great news, there are ways to manage the increases and to even lessen the impact.

1. Negotiate Your Shipping Contracts with UPS

One way to potentially mitigate the impact of UPS rate increases is by negotiating your shipping contracts with the company. As a regular shipper with UPS, you may be able to secure a lower rate by contacting your UPS representative and discussing your shipping needs. 

This can include your shipping volume, frequency, and destination. By highlighting your business’s shipping history and demonstrating your loyalty to UPS, you may be able to negotiate more favorable terms before the rate increase goes into effect.

It is important to note, however, that negotiating shipping contracts can be a complex process and may require some expertise or outside assistance. Consider working with a shipping consultant or legal advisor to ensure that you are getting the best possible deal while protecting your business’s interests.

By taking proactive steps to negotiate your shipping contracts, you may be able to offset the impact of UPS rate increases and save your business money over time.

2. Optimize Your Shipping Process

There are several ways to optimize your shipping process to reduce costs. Consider using smaller boxes, shipping in bulk, or consolidating shipments to reduce the number of shipments. By doing so, you can lower your shipping costs and minimize the impact of the rate increase.

3. Communicate with Your Customers

Be transparent with your customers about the increase in shipping costs and any adjustments you make to your own pricing as a result. Consider offering options like free shipping for orders over a certain amount or flat-rate shipping to help offset the increased costs. By communicating openly and early with your customers, you can maintain their trust and loyalty. 

4. Consider Alterative Shipping Options

Research other shipping carriers or methods to see if there are more cost-effective options for your business. You may find that another carrier offers lower rates, especially for specific shipping destinations. Switching carriers may take time, so start researching and testing alternative options as soon as possible.

Talk with a Dropoff expert today to streamline your last-mile delivery operations and mitigate potential costs impacted by the UPS GRI.

FAQs on the 2023 UPS General Rate Increase

1. When will the UPS rate increase go into effect?

The UPS GRI will go into effect on December 27, 2023. This may vary slightly depending on your shipping service and location. Best to check with UPS to be absolutely certain.

2. Which shipping services will be affected by the rate increase?

The UPS rate increase is expected to impact shipping services, including domestic and international ground and air services.

3. Why is UPS increasing its rates?

The rate increase is due to rising operational costs, including the cost of fuel, labor, and technology investments.

4. How much of a GRI increase can we expect from UPS?

The exact amount of the rate increase may vary depending on the shipping service and location, but businesses and consumers should anticipate a significant increase of up to 6.9% in shipping costs.

5. Can I negotiate my shipping contracts with UPS for a lower rate?

Yes, as a regular shipper with UPS, you may be able to negotiate a lower rate with the company. Contact your UPS representative to discuss your shipping needs and see if you can secure more favorable terms.

6. Are there alternative shipping options to consider to avoid the UPS rate increase?

Yes, there are several alternative shipping options to consider, including FedEx, DHL, and the United States Postal Service (USPS). However, it is important to carefully evaluate these options to ensure that they meet your business’s shipping needs and are cost-effective.

7. How can I stay informed about future UPS rate increases?

It is important to regularly check UPS’s website and sign up for email notifications to stay informed about any future rate increases or changes to their shipping policies. Additionally, working with a shipping consultant or legal advisor can help you navigate any future changes and ensure that your business is well-prepared.

The UPS rate increase for 2023 is expected to have a significant impact on shipping costs for businesses. Shippers should take proactive steps to mitigate the impact of the rate increase, including negotiating shipping contracts with UPS, optimizing the shipping process, communicating with customers, monitoring expenses, considering alternative shipping options, and staying informed about future rate increases. While there’s no guarantee, there are usually at least some ways to minimize delivery rate increases.

By being proactive and taking necessary measures, businesses can effectively manage the increased shipping costs and maintain their profitability in the face of the UPS rate increase. It is important for shippers to stay informed, plan ahead, and explore all available options to minimize the impact on their bottom line.

Was this article helpful for you?
Thanks for your feedback!
Yes No
Enhance The Customer Experience With Same-Day Delivery Services!  
Talk To An Expert

Enhance The Customer Experience With Same-Day Delivery Services!