UPS® recently announced new rate changes which will impact parcel shippers utilizing their shipping services. According to UPS, the change is being implemented due to the additional handling required for affected packages in their network.
From the UPS website:
Effective June 6, 2016, UPS is changing the measurement that determines whether the UPS Additional Handling charge will be applied to UPS® Ground services packages in the U.S.
- Any package with the longest side exceeding 48 inches, instead of 60 inches, will be assessed the fee.
- The Additional Handling fee of $10.50 remains the same.
- The change does not impact UPS Air or International shipments.
What Does This Mean for You?
It is important that parcel shippers understand the impact any rate changes have not only on their parcel spend, but on their overall business. Previously, this charge was significantly more lenient; parcel shippers were able to exceed 60 inches on the longest side of their package without incurring this charge. With this change, however, those who ship packages with a side exceeding only 48 inches will become eligible for a UPS Additional Handling Charge.
What Can You Do About It?
- Audit: Make sure you are prepared for any potential impacts this may have on your parcel spend. Parcel shippers should utilize technology platforms and auditing service to stay apprised of their data trends by monitoring Key Performance Indicators (like cost per package) on a weekly basis.
- Reassess: Additionally, if your shipping profile regularly includes packages whose longest side exceeds 48 inches, it may be useful to reassess whether such packaging is appropriate or can be reduced in order to avoid the additional fee.
- Renegotiate: Lastly, if changing the size of the packaging isn’t an option for your business and data suggests that this will have a major impact on your parcel shipping spend, it may be worth considering renegotiating your parcel carrier agreement. While you might not be able to avoid the UPS Additional Handling Charge specifically, you may be able to reduce other surcharges and accessorials that drive up your overall cost per package.
For help understanding and limiting how UPS’s expanded Additional Handling Charge impacts your business, contact VeriShip.