In the final few days of 2015, the rates for UPS changed.
In general, the prices saw a slight increase. Knowing the new costs is important. It can have a massive impact on your profitability if you start to undercharge your customers on their packaging and postage. You might need to change your charges or alternatively look for different ways to get your products delivered to your customers.
Why Are UPS Increasing Their Costs?
There are numerous reasons why UPS has increased its price:
For one, they want to improve their delivery coverage area and enhance their Next Day Air Early service. This improvement will include an additional 4500 ZIP codes.
The second reason is to do with their international shipping, something that is a must in today’s modern and complex economy.
UPS already delivers more packages internationally than any other courier.
They want to increase this to add more coverage and provide you with more potential customers.
UPS will also increase the convenience and control for your customers. The greater this is, the more attractive your products are.
By the end of last year they had 8,000 UPS Access Point locations in US cities and 22,000 internationally.
The New Prices
According to their website, there are a range of price increases for UPS this year.
The rates for UPS Ground services have increased by an average of 4.9%.
The rates for UPS Air and International services have increased by an average 5.2%.
In addition to these charges, there are some changes to the surcharges. These include an additional handling surcharge that will increase by $1.50. Address corrections have also increased by 50 cents, though there is a maximum Address Correction charge that can be applied to shipments. This will be $3.50 more than in 2015.
If your package is missing an account number or it is invalid, the increased administration fee is $0.50. The same increase can be seen on the refusal fee and chargeback for consignee billing shipments.
As from December 28, 2015 the daily rates and standard list rates have been combined into a single publication.
This will be referred to as the Daily Rates. All shippers who had received either the Daily Rates or Standard List Rates, which includes those shippers who were provided with a customised shipping agreement, should receive combined Daily rates from now on.
This should help to make it easier for all shippers to calculate their postage fees and unifies everyone on a single system.
Air Freight will also see an increase in charges. Those packages destined for US, Canada and Puerto Rico will have seen an increase of 5.2%. Other UPS Freight will also increase by an average of 4.9%.
How Can You Save On Costs?
Unless you are going to raise the delivery costs of your products with your customers, these changes are going to have an impact on your bottom line.
You will need to work extra hard to recover those profits just to ensure that you match your results from last year. So consider how you can save the costs on your shipping.
There are many ways that you can save on the costs of sending your products to customers:
For instance, you could reduce the size and weight of your packages to ensure that all necessary protection is applied, but the parcel is not too bulky.
Alternatively, you could send your parcels in bulk. This can often allow you to negotiate deals with your shipping company and get better rates for your products.
Finally, you could use a fulfillment specialist like Floship. We have the best experience to get the most for your shipping budget. We provide the logistics to get products to customers on time and cost effectively.
- Do you use USP?
- Has the price increase affected you badly?