UPS Adds Residential Holiday Shipping Surcharges; FedEx Will Not Follow

08/30/2017 — PartnerShip

The holidays are approaching and that means an increase in small package shipping. If you use UPS for residential Ground shipping, you’ll also see new holiday residential shipping surcharges from the Atlanta-based company.

UPS announced that it will add a 27-cent charge on all Ground residential packages sent between November 19 and December 2. This includes two of the busiest online shopping days of the year, Black Friday, which is November 24 and Cyber Monday, which is November 27.

The charge hibernates for two weeks, then returns December 17 through December 23, during which time all Ground residential deliveries will see the additional 27-cent charge, plus an additional 81-cent charge for next-day air shipments or an additional 97 cents for two-day or three-day delivery.

According to financial news outlet Bloomberg, the surcharges will increase the cost of UPS residential deliveries by roughly 3 percent.

The stated reason for the company’s surcharge increases is that online shopping and e-commerce has grown significantly over the last twenty years and UPS sees a huge influx of packages during the holiday shopping season that puts stress on its systems, processes and machinery. On an average day, UPS processes around 19 million packages but during the holiday season, that number swells to 30 million packages.

In order to meet demand, UPS says it has to add planes, trucks, and thousands of employees; and the surcharges are necessary to offset the additional cost of the holiday package surge.

“UPS’s peak season pricing positions the company to be appropriately compensated for the high value we provide at a time when the company must double daily delivery volume for six to seven consecutive weeks to meet customer demands,” according to Glenn Zaccara, a spokesperson for UPS.

UPS is also adding a Large Package surcharge of $24 and a Over Maximum Limit surcharge of $249. Both of these UPS surcharges are effective November 19 through December 23, 2017.

In a notable departure from UPS, FedEx will not apply residential surcharges this holiday season, except for packages that are big or bulky enough to require special handling.

Between November 20 and December 24, 2017, FedEx Express and FedEx Ground in the U.S. and Canada will increase the additional handling surcharge by $3 per package and $25 per package for oversize packages. The largest surcharge of $415 per package is only applied to packages that exceed the FedEx maximum size limit and cannot move through its sorting equipment.

With the additional handling surcharge for oversized packages, both UPS and FedEx are trying to discourage large and heavy, odd-sized shipments, because they cannot pass through its automated systems and require additional handling. In fact, the volume of oversized packages handled by FedEx Ground has increased 240 percent during the past ten years and is now 10 percent of the ground operation’s volume. This is “largely driven by expansion of e-commerce into sports equipment, furniture, mattresses and other things that weren’t largely available on e-commerce 10 years ago,” according to Patrick Fitzgerald, senior vice president of marketing at FedEx.

It's important to evaluate how you these changes might affect your shipping costs. Through a PartnerShip-managed shipping program, you can receive significant discounts on select FedEx services - resulting in savings that can help to offset cost increases like these. If you're not sure if you qualify for one of our small package shipping programs, contact us and we'll find the solution that's right for you.

Everything You Need to Know About Freight Claims

08/25/2017 — Leah Palnik

Damaged freight is every shipper’s worst nightmare. To make it worse, filing freight claims is a complex and frustrating process. There is a lot you need to know about what to document, what to file, and what the Carmack Amendment covers. Before you find yourself in this mess, it’s best to learn some of the basics.

First, damaged freight isn’t the only type of freight claim you may encounter. You may also experience a shortage or a lost shipment all together. And then there’s the concealed claims – when the cargo damage or shortage is discovered after delivery and reported after the driver leaves. As you can imagine, there can be extra hoops to jump through in these situations.

Before you can understand what to do in the case you need to file a cargo claim, you need to understand the Carmack Amendment. This law addresses the issue of liability between shippers and carriers. Under this law, you have to establish that the goods in question were picked up in good condition, delivered in damaged condition, and resulted in a specific amount of damage.

Once you’re able to prove that these requirements were met, the carrier is held liable unless it proves that it was not negligent and the cause of cargo damage was one of the following: 

• Act of God 
• Public enemy
• Act of default of shipper 
• Public authority 
• The inherent vice or nature of the goods

If you have to file a claim, it’s best to do it as soon as possible. You typically will have 9 months from the delivery date, or only 5 days in the case of a concealed claim. You’ll want to have the Proof of Delivery (POD), the original Bill of Lading (BOL), freight bill, merchandise invoice, and replacement invoice or repair bill to support your claim. Taking pictures to include is also very helpful.

Unfortunately there are several issues that could cause your cargo claim to be denied. If you want to secure a fair resolution, make sure your documentation is accurate, your claim includes specific details, and you have proof that you attempted to mitigate the damage.

The subject of freight claims is complicated, but that doesn’t mean you’re out of luck. PartnerShip has developed a helpful white paper that details everything you need to know about filing a freight claim. It also provides you with important information that will teach you how to package your shipments to avoid damaged freight, how to set procedures for accepting freight that protects you in the event you need to file a claim, and how to ensure your claim doesn’t get denied.

Download the free white paper: Everything You Need to Know About Freight Claims!

What You Need to Know About Freight Class Changes

08/10/2017 — Jen Deming

Weight, density, distance, and freight classification are all important variables that help to determine your LTL freight rate. Periodically,the National Motor Freight Traffic Association (NMFTA) will update and rework these freight classes in order to keep up with industry changes when needed. One such change went into effect on August 5, 2017 and has adjusted the NMFC class breakdowns on several categories of freight shipments. What are these changes and how will they affect you as a shipper?

The most significant change is seen in the categories of LTL freight that are classed according to a shipment's density or pounds per cubic foot.Typically, the lower the density, the higher the shipment will be classed (and the higher your rate will climb). Commodities such as Plastic Articles (15660), Wire Goods (198080) and Clothing (49880) are affected by this freight class update in addition to 138 other density-based freight classes.

The good news for shippers is that the new 11-tier system will provide a lower freight class for LTL shipments that are VERY dense (over 22.5 lbs per cubic foot).  If you are currently shipping loads that fall within this category, the lower freight class will potentially save you money going forward.

The other change affects mid-ranged LTL freight shipments with a class of 4-6 pounds per cubic foot previously set at class 150. With the new 11-tier breakdown, these shipments will be increasing to an updated class 175. Illustrated below, is the adjusted 11-tier classification system that will be replacing the former 9-tier model. Bold-faced density descriptions (subs) are the revised breakdowns.

It's important to mention that shippers with a FAK on certain types of commodities will also be affected. For example, if a shipper has been regularly shipping actual class 150 items at a FAK 100, and the density is 4-6 lbs per cubic foot, the shipment will now move at actual class 175 and the FAK will no longer apply.

What can shippers do to empower themselves and ensure they are doing the most they can to keep their LTL freight shipping costs low? At PartnerShip, you work directly with a dedicated freight specialist who will assist in calculating the accurate density of your shipments, and their proper freight class. Additionally, PartnerShip expertly audits your freight bills and will check for common invoicing errors, such as incorrect discounts and carrier mistakes—which cost your company money and affect your bottom line! If you are unsure on how to proceed with classifying your freight, or have a shipping challenge and don't know where to begin, PartnerShip can help point you in the right direction.

Find your freight class online!