Fresh Fees Hit Packages Over 50 Pounds & E-Commerce Battle Begins in India

by | Jan 2, 2020

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New UPS, FedEx Fees Go Into Effect

As part of their 2020 rate increases, FedEx and UPS added a $24 fee on packages weighing more than 50 pounds. The companies say that the fee will help offset the additional handling that these packages require.

Prior to 2020, packages that weighed more than 70 pounds had additional handling surcharges, but together the companies are lowering the threshold. Some estimate that the new threshold will impact 14.5% of packages shipped, as opposed to 8.4% of packages that were affected by the old rule.

“These changes will ensure that we continue to provide the level of service that our customers expect while responsibly managing capacity through our network,” a FedEx spokeswoman told The Wall Street Journal.

Like all of the annual changes made by FedEx and UPS, not all companies will be hit by this fee equally. Depending on the weight of the items that are shipped, some companies could hardly see an increase in shipping costs, while others could see a cost increase in the millions.

The new rate went into effect at UPS on Dec. 29. FedEx’s change starts on Jan. 6.

E-Commerce Battle Between Amazon and Asia’s Richest Man Commences 

In a move to challenge Amazon’s e-commerce dominance in India, billionaire Mukesh Ambani is testing his own online shopping platform, JioMart. The company will offer more than 50,000 products including grocery items.

While the service is currently only offered in three neighborhoods around Mumbai, the company is offering competitive incentives that include free home delivery and a good return policy. These incentives are designed to compete with Amazon, who has offered their prime membership since 2016.

Amazon and JioMart aren’t alone in the India market. They also face off against Walmart-owned Flipkart which has been operating since 2007 and claims to be “India’s biggest online store.”

E-commerce only accounts for a fraction of India’s total retail sales, but it is a sector that is expected to grow over the next few years. Amazon, Walmart and now JioMart are expected to compete fiercely for India’s market, which has over one billion people and is expected to become the most populated country by 2050.

Topics: eCommerce Shipping, Large Package Surcharge, Oversize Surcharge, Surcharges