How many parcels did customers divert from UPS during the Teamsters negotiations?

For months, analysts predicted that the Teamsters and UPS would strike a deal before the deadline. However, as midnight on July 31 loomed closer, many businesses jumped ship and shifted their parcels to alternate carriers. In the Q2 Earnings Call on August 8, UPS CEO Carol Tomé said, “We expected negotiations with the Teamsters to be late and loud, and they were. As the noise level increased throughout the second quarter, we experienced more volume diversion than we anticipated.”

UPS package volume was down 1.2 million parcels daily in the second quarter as customers flocked to FedEx, the United States Postal Service, and other regional carriers amid strike uncertainty. Compare that to last year, when UPS delivered an estimated 24.3 million packages daily. Now, it is committed to regaining the nearly 5% of lost business and adding new clients.

Why UPS? Why now?

Tomé announced that it is “all hands on deck to win back the volume that was diverted due to the labor negotiations.” These win-back strategies include:

• Setting up a control tower to make the onboarding of return volume as smooth as possible
• Amplifying the message that UPS offers the best service in the industry
• Boosting its SurePost advantage, which offers low-cost last-mile delivery for lightweight packages to residential addresses
• Expanding weekend pickup and Saturday deliveries
• Enticing small- and medium-sized businesses with new offerings through its Deal Manager

The strike is off the table, and UPS is ready to resume business with long-term customers that took a hiatus and welcome new clients— just in time for peak season.

What does this mean for your business?

As the newly-negotiated UPS contracts go into effect, it’s more important than ever that the carrier’s volumes trend up. Tomé stressed that the decline in volume isn’t worrying, as the company focuses on long-term strategy over short-term losses. She revealed, “We are now laser-focused on executing our win-back initiatives and pulling through the more than $7 billion of opportunity in our sales pipeline. To do so, we will leverage our superior service and capability and the investments we’ve made in the digital customer experience.”

Whether you are interested in switching carriers, adding additional volume, or simply finding out whether your current UPS contract is competitively priced, the team at ShipRx can help. As UPS focuses on winning back customers, you can expect great pricing and exceptional service if you switch to UPS.

We’ll audit your current contract for free, and you’ll only pay if you’re saving money. You’ve got nothing to lose, and with UPS’s goal of winning back customers, now’s an excellent time to negotiate.

James Founding Partner