Blog / UPS Follows FedEx Down The Peak Surcharge Path
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Summertime and the living is... expensive-- UPS rates surge in July

Big changes are on the horizon for UPS customers. Are you ready for the financial impact? On June 22, 2021, UPS published a statement on their website saying that, “Effective July 4, 2021 until further notice, the amount of the Peak Surcharges applied to U.S. shipments will change. All other previously announced Peak Surcharges will remain unchanged.” We’re not talking minimal charges either. Let’s talk through some of the new rates, UPS’s reasoning for the increase, and how you can protect your bottom line from unexpected price hikes in the shipping industry.

What are the new rates?

What are the new rates?

You can read the full update here, but the following changes are a few we expect to impact our clients directly: 

  • Additional Handling for qualifying customers on all U.S. domestic, U.S. import, and U.S. export shipments will increase by 100% from $3 per package to $6 per package by October 3, 2021
  • The Large Package Surcharge for qualifying customers on all U.S. domestic, U.S. import, and U.S. export shipments will increase from $31.45 per package to $60 per package
  • A new Over Maximum Surcharge of $250 will be imposed on U.S. domestic, U.S. import, and U.S. export shipments
  • A peak surcharge of up to $6.15 per package will be applied for qualifying customers on U.S. domestic shipments through UPS Air Residential, UPS Ground Residential, and UPS SurePost packages 

This announcement comes just one month after FedEx revealed their new shipping surcharges.

Why is UPS making these changes now?

New UPS rate increases come after their investor and analyst conference, in which they detailed 2023 financial targets, targeted areas of growth, and its Customer First, People Led, Innovation Driven strategy. 

Carol Tomé, UPS chief executive officer, shared that, “We are creating a new UPS, rooted in the values of the company. Our strategic priorities are evolving to reflect the changing needs of our customers and our business, and what matters most to our stakeholders.” Those strategic priorities include providing the best possible digital experience to the customer, a goal of being carbon neutral by 2050, and increasing their consolidated revenue ranging from approximately $98 billion to approximately $102 billion. 

As demand for shipping services increases with a shift toward e-commerce, carriers like UPS are increasing their rates to keep up. These increased rates allow UPS to meet your needs while funding their long-term goals.

Fight back by renegotiating you carrier agreement

If your business is hit with increased rates and peak surcharges, the first thing you need to do is contact ShipRx. Alone, it can feel impossible to negotiate with your carrier– they seem to always have the upper hand. 

The team at ShipRx began our careers with the major carriers, writing their contracts. These days, we work with businesses to negotiate the lowest possible rates. Because we know what businesses just like yours pay, we’re able to negotiate a fair and reasonable contract that protects your bottom line from exorbitant price increases. 

If you’re spending between $500,000 and $2 million in parcel shipping annually, we can help. Get in touch with us today to set up a free contract consultation and start saving today!

 

Brittany ShipRx Contributor
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