In May 2021, Intelligent Audit reviewed the recent changes to the UPS peak season surcharges schedule, as well as several implemented and proposed changes to FedEx, USPS and Canada Post parcel schedules. This is not surprising as carriers endure the effects of limited resources, changing policies regarding ocean liners and more. Even more impactful is the ongoing needs and demands of customers, which appear to be on track to shatter all records for peak season ordering and shipping. In response, the major carriers have implemented these increases during unusual times to help offset their costs of transportation. And now, UPS has once again released new surcharges that will take effect this year for peak season as follows for US Domestic shipments:
- $3.50 additional handling per package surcharges from July 4, 2021 to October 2, 2021.
- $40.00 per item Large Package Surcharge for the same period.
- $6.00 additional handling per package surcharges from October 3, 2021 to January 15, 2021.
- $60.00 per item Large Package Surcharge for the same period.
- Over maximum limits will incur a $250.00 surcharge from October 3, 2021 to January 15, 2022 as well.
Additionally, UPS has determined that further peak season surcharges will be applied from October 31, 2021 to January 15, 2022 too. The peak season surcharges vary and depend on both service level and percentage volume increase compared to February 2020:
|Service Level||110% - 200% of February 2020 Volume||200%-300% of February 2020 Volume||300%-400% of February 2020 Volume||400%-500% of February 2020 Volume||>500%
of February 2020 Volume
|UPS SurePost||$1.15 per package||$2.15 per package||$3.15 per package||$4.15 per package||$5.15 per package|
|UPS Ground Residential||$1.15 per package||$2.15 per package||$3.15 per package||$4.15 per package||$5.15 per package|
|UPS Next Day Air Residential||$2.15 per package||$3.15 per package||$4.15 per package||$5.15 per package||$6.15 per package|
|All Other UPS Air Residential||$2.15 per package||$3.15 per package||$4.15 per package||$5.15 per package||$6.15 per package|
The continuing increases to peak surcharges are not surprising due to the increased strain on available resources. And they reiterate the need for a single source of truth to understand total shipping spend. Moreover, taking these surcharges into account is essential to helping shippers understand which carriers to use, when and why, based on the unique needs of each shipment.
It All Amounts to Keeping an Eye on Peak Season Surcharges AT ALL TIMES
Shippers have a problem as recovery continues. The amplification of e-commerce has created a new animal and demand for logistics. The entire strategy for peak season in prior years is antiquated and inefficient as carriers look to leverage their resources to meet minimum requirements. As such, shippers will face more uncertainty as rates continue on their upward trend. However, there is a light at the end of the tunnel, and that light is powered with logistics and shipping data insights.
The key to keeping it turned on is in using a single source of truth to understand the total effect of new surcharges, their granular impacts, and when to rethink current fulfillment models to procure capacity and avoid delays. Fortunately, Intelligent Audit is that solution and power source described. For help in understanding these charges and their total implication for your level of freight spend, connect with Intelligent Audit today.