Start saving your pennies now, in a few months you may need the extra cash to ship your holiday goods! UPS is adding yet another surcharge to packages shipped between Black Friday and Christmas. The surcharge will be an additional 27 cents for each ground shipment, 81 cents for next-day air and 97 cents for two- or three-day delivery. It may not sounds like a lot, but it will certainly add up especially from a business standpoint.
Businesses now have to decide what their best option is during this holiday season. They can either, eat the cost, have the consumer pay for the shipping, or increase the cost of the goods to compensate. None of these are very opportune situations and may leave the consumer dissatisfied. Another option could be for the retail stores to promote their “holiday” deals a different week. These peak surcharges won’t take place the two following weeks after Black Friday and Cyber Monday, but will pick back up again from December 17 – December 23. There is a slight grey area to this new development; the surcharge is only applied for residential shippings. Meaning, retailers and shoppers can have the item sent to the store for pickup to avoid the extra costs.
The reason for UPS doing this isn’t necessarily to make more money, but to stay profitable and meet their margin. During these busy times of shipping, they have to increase labor, and add on more transportation to get the high volume of packages out. As quoted in the Wall Street Journal from Sanford C. Bernstein*, “Without them, Christmas kind of doesn’t happen.” With a huge increase in online shopping, there is truth behind what Bernstein says.
If you are interested in learning more and how this might affect you, please contact your client service rep at Fulfillment Plus, Inc!