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The Latest UPS Headlines
Why United Parcel Service and FedEx Corporation Are Hiking Prices
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<blockquote data-quote="cheryl" data-source="post: 2388826" data-attributes="member: 1"><p><a href="http://www.fool.com/investing/2016/10/01/why-united-parcel-service-and-fedex-corporation-ar.aspx" target="_blank"><strong>Why United Parcel Service and FedEx Corporation Are Hiking Prices - Motley Fool</strong></a></p><p></p><p><strong>Why prices are going up</strong></p><p>The pricing increases will grab the headlines, but in reality they are part of a series of actions both companies have been taking to maximize profitability. In short, FedEx and UPS need to take these measures because they are seeing margin pressure as a result of burgeoning e-commerce delivery growth. That pressure shows up in different ways.</p><ul> <li data-xf-list-type="ul">The need to expand capacity to deal with increased costs brings about higher operational costs -- at least initially eating into gross profit margins.</li> <li data-xf-list-type="ul">E-commerce demand during peak season is putting pressure on both companies to have the right capacity in place at the right time -- UPS in particular has had issues with this subject.</li> <li data-xf-list-type="ul">E-commerce vendors are packaging inefficiently and increasingly shipping large, difficult-to-deliver items, such as trampolines or gym equipment.</li> </ul></blockquote><p></p>
[QUOTE="cheryl, post: 2388826, member: 1"] [URL='http://www.fool.com/investing/2016/10/01/why-united-parcel-service-and-fedex-corporation-ar.aspx'][B]Why United Parcel Service and FedEx Corporation Are Hiking Prices - Motley Fool[/B][/URL] [B]Why prices are going up[/B] The pricing increases will grab the headlines, but in reality they are part of a series of actions both companies have been taking to maximize profitability. In short, FedEx and UPS need to take these measures because they are seeing margin pressure as a result of burgeoning e-commerce delivery growth. That pressure shows up in different ways. [LIST] [*]The need to expand capacity to deal with increased costs brings about higher operational costs -- at least initially eating into gross profit margins. [*]E-commerce demand during peak season is putting pressure on both companies to have the right capacity in place at the right time -- UPS in particular has had issues with this subject. [*]E-commerce vendors are packaging inefficiently and increasingly shipping large, difficult-to-deliver items, such as trampolines or gym equipment. [/LIST] [/QUOTE]
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