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UPS Announces Rate Increases

Posted by Rachel Carollo on Oct 27, 2017 4:06:39 PM

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Following on the heels of FedEx's recent rate increase announcement, today UPS disclosed that they'll also raise some of their rates by 4.9%.

Here's what Reuters had to say about the news:

"UPS, the world’s largest package delivery company, said its 4.9 percent increase would go into effect on Dec. 24 and apply to UPS Ground, UPS Air and International services, plus UPS Air Freight Rates in the United States, Canada and Puerto Rico.

The company’s main rival FedEx Corp (FDX.N) said last month that rates at its FedEx Express unit will go up by an average of 4.9 percent for U.S. domestic, export and import services as of Jan. 1.

Atlanta-based UPS also said it would raise surcharges for most residential packages for the 2018 peak season - the busy season leading up to the holidays in December - “by a few pennies.”

For instance, the surcharge for UPS Next Day Air packages will rise to 84 cents in 2018 from 81 cents this year, while the peak surcharge for UPS Ground packages will increase to 28 cents from 27 cents.

UPS will also apply a new 2018 peak season surcharge for additional handling of large or awkward packages of $3.15.

As of July 8 2018 the company will also raise the additional handling cost for packages weighing over 70 pounds (32 kg) to $19 from $12 and raise the additional handling charge for large packages delivered to a residential address to $90 from $80.

Investors have expressed frustration that UPS and FedEx have had to invest heavily in network expansion to handle soaring lower margin e-commerce volumes.

UPS has unveiled a number of new surcharges in recent years, which are seen as a way not only to manage the higher costs associated with e-commerce but also to encourage retailers that ship excessively large, heavy or unwieldy packages to seek alternative shipping methods."

As a business owner or operator, it can be a real challenge to either eat these increased costs or pass them onto your customers at a time when it's imperative to be as competitive as possible. That’s why it’s important to find an alternative delivery solution, especially for local, last mile deliveries.

Dropoff’s same-day delivery service offers a convenient and flexible solution. Most importantly, you can rest easy knowing that Dropoff never tacks on hidden fees or surcharges. The price we quote is the price you’ll pay.

As large package delivery companies continue increasing rates and tacking on fees and surcharges year after year, the time is now to start leveraging a more convenient, flexible and transparent delivery solution.  

You can read the full Reuters article here.

Topics: Logistics Industry

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