UPS just announced 2019 peak season surcharge application, dropping additional holiday levies on residential deliveries while expanding certain surcharge hikes to include the entirety of Q4.
UPS applied a surcharge of between $.28 and $.99 per package on residential shipments during the 2018 holiday season. FedEx did not join UPS in applying an additional surcharge for residential shipments last year, and have not announced an update for 2019.
UPS will apply peak season surcharges to packages currently subject to Add’l Handling, Large Package, and Over-Maximum surcharges. Additionally, peak season surcharges relating to Large Package and Over-Maximum shipments will be applied over the entirety of Q4 2019, through January 4th, 2020.
Packages subject to Add’l Handling will be assessed a peak season surcharge between November 24th and January 4th; Excluding the YoY concession on residential peak season surcharge, all UPS applications are experiencing tremendous increases in comparison to 2018. Add’l Handling will increase by 14% YoY, to an addition of $3.60 per package. Large Package classifications will result in an additional $31.45 surcharge, representing an increase of 20%.
Lastly, Over-Maximum classifications will result in an additional $250 surcharge, an increase of 50% when compared with 2018.
This shift largely targets packages that are either unattractive from a UPS cost basis or shouldn’t be in the network (Over-Maximum), while increasing YoY pricing competitiveness for residential shipments. As UPS continues to experience robust growth in e-commerce volumes and associated delivery/stop density improvements, residential shipments are decreasingly onerous from a cost basis. This factor plus expansion of surcharges in the aforementioned areas will likely keep overall revenues intact while providing significant benefit to B2C shippers.
Contact AFMS, learn how our team can help you reduce these new charges and help lower your parcel shipping costs. 800-246-3521
