This is the most aggressive Peak Season pricing strategy we have seen UPS take. It is geared towards E-Commerce / Residential Shippers and the goal seems to be to 2-fold:
1. Control the influx / flow of weekly package volume into the UPS network between Nov 15th 2020 – Jan 16th, 2021.
UPS is using Price to try and drive shippers’ behavior to help them better control and manage Peak Season weekly package volume flow in their network. The 3 tier surcharge matrix in section F seems to be designed to control the rate of volume a shipper plans to tender to UPS each week during the peak Period and / or for shippers to spread package volume to other Parcel Carriers: USPS, FedEx, Ontrac, Lasership each week during the peak period.
2. UPS is going to make more $$$ in Peak 2020.
UPS and their new CEO, Carol Tome, know shippers are in a very tough situation due to COVID-19 and have to use Parcel Carriers to drive sales and get products to customers. She has said publicly that UPS needs to get smaller and charge more for their services.
AFMS helps companies mitigate these carrier announcements. Please feel free to contact us today and let us review the impact on your company.
