UPS to Add Delivery Surcharges for Black Friday, Christmas Orders
June 19 2017 - 11:15AM
Dow Jones News
By Paul Ziobro
Holiday shopping is about to get more expensive.
United Parcel Service Inc. for the first time will tack a
surcharge onto most online orders shipping around the Black Friday
shopping weekend and during the week before Christmas. It is the
latest attempt by the large delivery company to recoup the massive
increase in hiring and reserving extra trucks and plans during the
busiest times.
The changes puts retailers, who are struggling to adapt to a
world where more people shop online, facing the prospect of either
eating the higher charge or trying to recoup it by raising
prices.
UPS on Monday said the surcharge will be 27 cents a package for
all ground shipments to homes sent between Nov. 19 and Dec. 2,
which includes some of the busiest online shopping days. Ground
orders typically arrive within five days and are a heavily used
shipping option during that time since shoppers don't necessarily
need the items quickly.
The peak surcharges go away for the next two weeks, when
shoppers typically take a pause, but return for the final holiday
rush. From Dec. 17-23, UPS will charge an extra 27 cents for each
ground shipment, 81 cents for next day air, and 97 cents for two-
or three-day delivery.
The charge only applies to residential deliveries, so retailers
and shoppers may be able to avoid the charges by getting orders
shipping to stores, an option retailers have been pushing for the
past few years with varying success.
Chief Commercial Officer Alan Gershenhorn said the per-package
cost will only "marginally increase" during this time. As an
example, UPS said a five-pound next-day air package from Atlanta to
Philadelphia will cost 1% more to ship.
The surcharge, however, will provide a much bigger haul to UPS,
whose daily volume swells to more than 30 million in the weeks
before Christmas versus more than 19 million on a normal day.
UPS will also impose surcharges on all large packages, which
cost more to ship and sort, throughout the entire period. It is
encouraging shippers to instead send such packages through its
freight network, where it recently imposed a second 4.9% increase
in the past year.
UPS's main rival FedEx doesn't have a surcharge during the
holidays, although the two carriers often match each other on
pricing moves. A FedEx spokesman on Monday declined comment.
Write to Paul Ziobro at Paul.Ziobro@wsj.com
(END) Dow Jones Newswires
June 19, 2017 11:00 ET (15:00 GMT)
Copyright (c) 2017 Dow Jones & Company, Inc.
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