A substantial UPS strike is startingly close to taking place this summer.
UPS has until midnight on Monday, July 31 to negotiate Teamster terms or face a massive walkout by hundreds of thousands of its workers.
The impact of a Teamsters UPS strike could be devastating to both UPS and its customers. For context, when UPS workers went on strike in 1997, it resulted in a 15-day walkout. The company lost more than $600 million.
The UPS workforce has since doubled, managing 24 million packages a day. UPS handles nearly 1 in every 4 parcels shipped in the U.S.
Given this magnitude, a UPS strike could have far-reaching economic consequences; at best, causing delivery delays, and at worst, a potential halt to the supply chain.
Here’s what you need to know:
Understanding the Risks of a UPS Strike in 2023
The Teamsters Union represents 340,000 UPS workers. Negotiations began in April of this year, but both parties have not yet been able to reach a contractual agreement.
A press release dated June 16 shares that Teamsters overwhelmingly voted by 97% to strike if UPS fails to deliver a strong contract.
“This strike authorization vote sends a clear message to UPS that our members are damned and determined to take necessary action to secure a historic contract that respects their dedication and sacrifice,” said Teamsters General Secretary-Treasurer Fred Zuckerman. “Our members are the backbone of UPS, and they are the reason this corporation hauled in more than $100 billion in revenue just last year. It’s time for UPS to pay up.
Recently, some UPS union workers held a practice picket demonstration. So, things are continuing to heat up as the deadline draws closer.
What are UPS workers demanding?
The Teamster demands are numerous and include:
- More full-time opportunities
- Elimination of two-tier wages
- Air conditioning in UPS vehicles
- An increase in full-time positions
- Pay increases for part-time workers
- The cessation of a forced sixth day of work
- Elimination of driver-facing surveillance cameras from delivery trucks
How’s UPS’ financial health?
Like most shipping companies, UPS saw a boom during the pandemic as online shopping soared.
The company hit record profits in 2022 issuing more than $8 billion in dividends to shareholders. UPS did experience a 6% dip in earnings from Q4 2022 through Q1 2023. Overall earnings are down year over year.
However, in light of this more recent downturn, it’s worth noting that since the last Teamster negotiation five years ago, UPS profits have risen by $11.5 billion.
What can UPS customers do today?
While we can’t say this strike is imminent, it does remain a possibility. If you are a UPS customer, evaluate your needs and consider sourcing backup support. And the sooner you can get ahead of this, the better for your business and your customers. Here are some quick tips:
- Assess All Pending Deliveries: Identify all pending deliveries post-July 31. Be clear on when they’re scheduled to shop, what they are, and their quantity.
- Review Delivery Dates: Anything marked after July 31 may require another option. Know what you need to manage and when.
- Identify Priority Delivery Items: Review delivery items that need prioritization. Identify any time-sensitive materials that may be critical to your business operations.
- Review Delivery Quantity: How many actual items do you have listed to be sent by UPS? If it’s all or the majority, it’s recommended that you consider alternative delivery options as a backup.
6 Ways to Mitigate Risks Associated with a UPS Strike
Get a sense of what you’re dealing with so you can manage and mitigate any challenges, slowdowns, or potential halts that come your way.
1. Be Proactive – Check Your Agreements; Track Your Deliveries
Once you’ve assessed your pending deliveries, you’ll want to know the details of your agreements and contracts.
- Review your current delivery agreements and contracts. Find out what happens in the event of delays or supply chain challenges so you can be prepared and mitigate risks.
- Confirm delivery dates and times. Know your dates and times to ensure you avoid delays, can reasonably hold UPS accountable, and be prepared in case a transition is necessary.
- Ensure delivery addresses are correct. Now is a good time to confirm that everything is accurate so you are ready in the event of an emergency.
- Monitor delivery progress. Use UPS’ tracking tool to monitor your deliveries. This way you can address any issues fast.
2. Set Up a Transition Strategy
Should UPS workers go on strike, you may need to transition to another logistics provider. Of course, strike or no strike, it’s always good to have a backup plan in place. Mitigate your risks and have a transition plan ready to go.
Here’s what you need to consider to get started:
- Identify your shipping needs. Know if you need same-day delivery, next-day delivery, or international delivery. Starting here helps narrow your options quickly. helps narrow your options Research providers
- Map out a budget. Some providers may offer more services or have better on-time delivery rates. Prices may vary, so know what you can afford and what your priorities are.
- Negotiate contracts. If you have a consistent volume that’s regularly shipped, you have more negotiating power. Share your delivery needs and be sure to ask about any promotions or discounts offered. Here are some tips on how to reduce last-mile delivery costs.
- Test it out. Don’t fully transition to another logistics provider until you are 100% confident in their reliability. Do a test run and address any issues upfront.
3. Evaluate Alternative Delivery Solutions
Start simple. Make a list of potential new providers and schedule calls to learn about their services and pricing. Get quotes, compare prices, and find out how quickly their customer service team can react to potential challenges and inquiries.
When it comes to pricing, check for hidden fees, fluctuations, or anything that might skew your understanding of the whole picture.
Here are some of the big things to consider and compare:
- Delivery times
- Routes covered
- Driver certifications
- Geographical coverage
- Technology and integrations
- Customer service response time
- Delivery tracking and transparency
4. Maintain an Excellent Customer Experience
Regardless of what’s happening behind the scenes, you know that your job is to provide consistently excellent service for your customers. If there’s a delivery service provider transition, you’ll want to complete it as seamlessly as possible so your customers barely know anything changed.
Keep your customers happy by ensuring they can accomplish the following:
- Partner with customer service. You and your customers deserve complete 24/7/365 access to a responsible and reliable customer service team that is empowered to make things happen fast.
- Add flexible delivery options. Check if there are custom services available to meet you and your customers where they are. For example, know if there are same-day, next-day, off-hours, and weekend services available. Choose a courier that accommodates everyone’s needs.
- Track proof of on-time delivery trends. Any courier you choose to switch to or add to the mix should have a proven record of delivering packages on time and in good condition. If they don’t present this data, ask for it. Be firm in letting them know you will not compromise the reputation of your business.
- Access real-time delivery tracking. Customers expect to track their packages in real time. They, like you, should have full visibility into the entire shipping process to bring peace of mind and complete understanding.
5. Onboard a New Courier Partner
If you’ve found a new courier partner you are confident in and have completed a test run, you’re next move is to successfully onboard them. This can take time to get right but is a crucial step for long-term sustainability.
The best practice in setting up a new courier partner fast is to provide them with full access to all necessary information: business details, delivery addresses, time parameters, volume, and weight.
Establish a process and document it. This will help onboard others in the future while providing a playbook you and your new courier partner can use as a resource.
There are so many things to consider: delivery times, packing and labeling requirements, and delivery processes. With a robust tracking system, you should be able to monitor every step of the delivery journey, address mishaps, and celebrate wins
6. Stay Up to Date on Current Events
Teamster.org and UPS have both regularly been publishing updates about the potential strike on their respective websites. Dropoff is also closely monitoring the situation, so please check this space for updates.
What’s Next? Is UPS Going on Strike?
This could go either way and nothing is definite. Still, this event is a forceful reminder of how important it is to partner with multiple courier companies in case of an emergency.
Dropoff is closely monitoring the situation, so please check this space for updates. Teamster.org and UPS have both regularly been publishing updates about the potential strike on their respective websites.
A UPS strike could have devastating effects on UPS and the greater supply chain industry. However there’s still time for Teamsters and UPS leadership to land a negotiation agreement.
However, as mentioned above, there’s also time for UPS customers to evaluate their shipping needs. This could go either way and nothing is definite. Still, this event is a forceful reminder of how important it is to parter with multiple courier companies in case of an emergency.
Protect your supply chain and identify additional shipping support. Same-day delivery companies like Dropoff can augment UPS partnerships and oftentimes be faster and more agile. Talk to an expert to check on routes and pricing to discover where and how you can win.
FAQs on UPS Strike 2023
UPS Teamsters have committed to going on strike by midnight on July 31, 2023. If UPS does not meet the Teamsters’ contractual demands, a strike could be imminent.
UPS manages 1 in 4 packages sent in the U.S. so the implications of a UPS driver walkout could be economically devastating. It will likely result in a loss of profits for UPS and its shareholders, causing massive delays for UPS customers, and could potentially slow or even halt the supply chain.