UPS for the first time is extending its peak surcharges for residential delivery beyond the usual mid-January cutoff, referring to them as by the new designation of “demand surcharges” which will be in place until further notice, while FedEx is not following suit but letting them lapse.
Days before its third quarter earnings report, UPS matched rival FedEx by announcing a general rate increase of 6.9% for 2023, an unprecedented figure for both major carriers set as a benchmark for pricing shipper contract rates. FedEx took heat last month in announcing its rate increase last month, as it reported a painful quarter.
As much as ecommerce sellers want every shopper that loads up their cart to complete a purchase, the reality is that some simply won’t. However, many shoppers that vanish at the sight of added shipping fees will in fact hit the “buy” button IF they are given more shipping options and control over how they receive their order.
The UPU on Wednesday approved a compromise plan that will let countries set their own inbound postal rates, avoiding a threatened pullout by the U.S. that would have caused shipping chaos ahead of the peak holiday season. The U.S. can begin imposing self-declared rates next July, with others following in 2021.
At the first day of the Universal Postal Union’s extraordinary congress in Geneva Tuesday, the body voted 78-57 with 9 abstentions against a U.S. proposal to allow creation of self-declared postal rates, an effort to end the current inequitable terminal dues system, the Associated Press reported.
The Universal Postal Union (UPU), a hitherto quiet backwater that sets global cross-border mail and parcel rates, now plans to fast-track review of rate changes after President Trump last week threatened to pull out of the UPU accord, according to the Wall Street Journal.
The USPS is proposing a number of rate changes that would be effective on Jan. 27 including an average 9.3% increase in its Parcel Select service for packages weighing more than 1 lb., as it looks to recover rising costs and deals with stiff competition from major carriers.
A Senate hearing on a task force report recommending U.S. Postal Service reforms, scheduled for Sept. 5, has been postponed as President Donald Trump is delaying release of the report. No new date has been set, indefinitely postponing any legislative action, including possible raising of postal rates or even privatization.
As he reviews the report from his U.S. Postal Service task force and weighs next steps including possible privatization, President Donald Trump has now set his sights abroad in pursuit of more equitable international postage rates from the Universal Postal Union or UPU, according to media reports.
Because of all the changes with UPS and FedEx and the complexity in today’s carrier contracts, you need to do your due diligence in terms of shipping volumes, the value of your freight to the carriers and contract terms. These steps will help you better manage the negotiation and contract process to get the best terms possible.