Peak season pain looms for FedEx, UPS shippers - Freightwaves
Few places to hide as surcharges and other fees are imposed
For FedEx Corp. and UPS Inc., the demand iron has rarely been hotter. So it makes perfect sense to strike their shippers as often as possible.
With holiday demand, especially from e-commerce, expected to surge by as much as 50% over the 2019 peak, the companies are hitting their largest customers with big-time surcharges that take effect in November. But the purple and brown hammers aren’t stopping there. According to Rob Martinez, founder and co-CEO of parcel consultancy Shipware LLC, UPS is using fourth-quarter volumes as negotiating leverage even over moderate-volume shippers that are mostly being spared the pain of the surcharges.
Martinez said UPS’ negotiating message is a straightforward one: “‘Sign the proposed UPS pricing agreement NOW (his caps for emphasis) or get left out in the cold.’”
Martinez added, though, that FedEx and UPS continue to be responsive to pricing requests from smaller shippers, customers coveted by both carriers because they are stickier than big shippers and typically lack the huge volumes to demand deep discounts.
Few places to hide as surcharges and other fees are imposed
For FedEx Corp. and UPS Inc., the demand iron has rarely been hotter. So it makes perfect sense to strike their shippers as often as possible.
With holiday demand, especially from e-commerce, expected to surge by as much as 50% over the 2019 peak, the companies are hitting their largest customers with big-time surcharges that take effect in November. But the purple and brown hammers aren’t stopping there. According to Rob Martinez, founder and co-CEO of parcel consultancy Shipware LLC, UPS is using fourth-quarter volumes as negotiating leverage even over moderate-volume shippers that are mostly being spared the pain of the surcharges.
Martinez said UPS’ negotiating message is a straightforward one: “‘Sign the proposed UPS pricing agreement NOW (his caps for emphasis) or get left out in the cold.’”
Martinez added, though, that FedEx and UPS continue to be responsive to pricing requests from smaller shippers, customers coveted by both carriers because they are stickier than big shippers and typically lack the huge volumes to demand deep discounts.
