UPS to add surcharge for companies shipping large quantities starting this fall

Tuesday, August 11, 2020
UPS to add surcharge for companies shipping large quantities
Your online orders may cost you more if you're shipping UPS starting in the fall.

Shopping online during the upcoming holiday season could get more expensive if it's delivered by UPS.

The company will begin imposing surcharges of several dollars on companies that ship a huge amount of items this fall and early winter, anticipating rising costs as more people shop online because of coronavirus.

The new fees would cost several more dollars depending on how many packages the retailer ships weekly.

However, the new fees won't affect customers shipping small items at the UPS Store or other places. The fees are intended for what the company calls "large volume customers," and it's unclear whether retailers like Amazon, Target and others will pass the added costs onto customers. For some companies, those hefty fees could be hard to absorb, and they might end up in your shipping bill.

For a company that ships more than 25,000 packages per week, the surcharge will cost between $1 to $4 depending on whether it's delivered via ground or air. UPS decides the fee depending on the company's shipping volume in February of this year, prior to the pandemic hitting the US. Fees will be implemented from November 15, 2020, through January 16, 2021.

"UPS routinely adjusts its pricing to align with the cost to serve our customers, enabling the company to be appropriately compensated for the service and value we provide," a company spokesperson told CNN Business, adding that the new surcharges "reflect current market conditions caused by the pandemic."

UPS reported better-than-expected earnings last week because of the surge in online shopping. Demand for residential deliveries surged 65% and its average daily volume increased 23% in the second quarter.

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