UPS To Implement Surcharges During Holiday Shipping Rush
Christmas delivery surcharges. They’re going to be a thing.
UPS has announced that it will be placing holiday season surcharges on packages for the first time. The fee will be 27 cents a package during certain weeks in November and December. The reason for the fee? To cover costs generated only during that period.
When extra trucks and planes are purchased or rented at short-term premium rates, costs rise quickly. UPS also has to account for extra processing facilities and seasonal workers.
The extra surcharge will be in effect between Nov. 19 and Dec. 2 — the weeks encapsulating Black Friday and Cyber Monday — for ground packages. UPS will then break for the next two weeks, following customer slow-down patterns, and then roll them back in for the final holiday rush. From Dec. 17 to Dec. 23, UPS will charge an extra 27 cents for each ground shipment, 81 cents for next-day air and 97 cents for two- or three-day delivery.
27 cents may not seem like a lot, but it is definitely a step in a different direction from an industry that is moving to free shipping. Amazon set the free two-day standard and most companies are trying to keep up with the customer expectations this sets.
This will affect individuals, albeit in a small way because it’s 27 cents, but this is really targeted toward companies that have major shipping surges at the end of the year. Major companies that are either e-commerce giants, or trying to compete with them.
It’ll be interesting to see whether retailers pass along the fee to customers by raising shipping prices, or just eat it along with other shipping costs as they’ve had to do to keep up with customer demands in the recent past.
This will directly affect supply chain and may set precedents for the future, so this is your heads up.
