UPS, the United Parcel Service, is adding a surcharge on parcels sent in the peak period for ecommerce with the aim of encouraging retailers to send goods that are not time sensitive on quieter days.
Apparently a $0.27 surcharge for ground parcels in the USA came into affect on November 19th and will stay in play until December 3rd. And additional charges will come into force for USA grounds parcels in the week before Christmas too.
On premium 2 and 3 day deliveries in the week before Christmas the surcharge will be as much as $0.97. Such is the volume of UPS shipping that it’s predicted that the various surcharges could add up to $200 million.
Greg Brown is the president of UPS’s retail sector and he said:
“I don’t think it’s going to change buying patterns dramatically. What we’re trying to help retailers do is shape demand a little bit.”
Key competitors FedEx and USPS are not adding peak time surcharges so that may play to their advantage in the 2017 peak. And it is worth wondering whether the idea is controlling volumes or trying to increase profits. Considering that so may retailers will be tied in with UPS, many will have no choice but to absorb the additional charge rather than change provider.
Are you a retailer who is affected?
