UPS has had a busy holiday season with threats of a Teamsters strike circulating not too long ago. With the strike averted by a ratified new contract, UPS is now turning its attention to increasing annual shipping rates and, consequently, giving shippers little time to prepare for the changes.
Overview of 2019 UPS rate changes
Starting December 26, 2018, the following UPS changes go into effect:
- The rates for UPS® Ground, UPS Air, and International services will increase an average net 4.9%.
- Fuel surcharges will apply to Additional Handling, Over Maximum Limits, Signature Required and Adult Signature Required accessorials.
- A processing fee of $2.00 per package will be charged when Package Level Detail (PLD) is not provided to UPS prior to delivery.
- The rates for certain value-added services and other charges will increase.
This is the overview that UPS states on its website. But, as I’m sure you know, the average rate increase of 4.9% doesn’t accurately reflect the individual changes on surcharges. It’s important for shippers to analyze and understand what they ship, where it ships to, and what surcharges are most commonly found on invoices.
2019 UPS package accessorial changes
Often considered “value-added” service charges, accessorial costs add up quickly and contribute to a large percentage of carriers’ total revenue. Accessorial charges are set to soar in 2019 for both UPS and FedEx.
|UPS Surcharge||2018 Rate||2019 Increase||% Increase||2019 Total|
|Large Package Surcharge
|Over Maximum Limits Surcharge||$650||$200||30.76%||$850|
|Additional Handling Package Surcharge||$12
Less than 70 pounds
Less than 70 pounds
Greater than 70 pounds
Greater than 70 pounds
UPS Large Package Surcharge 2019
Any package that doesn’t conform to the size and configuration guidelines established by UPS incurs additional charges. The 2019 UPS Large Package Surcharge for U.S. Domestic residential packages is set to increase $25 bringing the total charge to $115. The Large Package Surcharge for U.S. Domestic commercial packages and for international packages will increase $15.00.
Over Maximum Limits Surcharge 2019
Surcharges are mounting on packages that are over maximum limits and could potentially disrupt UPS’ system. Packages with an actual weight of more than 150 pounds, or that exceed 108 inches in length, or exceed a total of 165 inches in length plus girth [(2 x width) + (2 x height)] combined are refused for transportation. In 2019 the surcharge increases by $200, making it $850 total to ship such a massive item. The Oversize Pallet Handling Surcharge will also increase $200.00.
Shippers get hit with a residential surcharge when the delivery address entered in the UPS shipping system, or the actual delivery address is deemed residential by the carrier. Carriers try to make the residential surcharge complex, so here are the detailed changes coming at the end of the year.
- The Residential Surcharge for domestic UPS Ground Service, UPS Standard to/from Canada and UPS Standard to/from Mexico shipments will increase $0.35.
- The Residential Surcharge for domestic UPS Air Services and UPS International Air Services will increase $0.40.
- The Residential Surcharge for UPS Hundredweight Service shipping will increase $2.65 per shipment.
Package Level Detail
UPS is penalizing any shipper that doesn’t provide all package details prior to delivery by charging $2.00 per package when Package Level Detail (PLD) is not provided. If you are a high-volume shipper tendering shipments electronically, this most likely won’t apply. If you are a shipper who completes shipping details manually, this extra cost is a serious threat.
Don’t let UPS surcharges slow your business down
Since changes go into effect on December 26, UPS’ rate increases capitalize on the post-holiday return process, whereas FedEx rate increases don’t target the busy post-holiday returns season.
These rates have unique impacts on every shipper. If you want to understand how these changes will influence your business, start by looking at which surcharges you see on your invoices frequently. The Share a Refund Auditing Team is trained to reduce transportation costs and improve supply chain efficiency. Don’t let these soaring surcharges siphon money from your business. Share a Refund has the transportation cost management solutions your business deserves.