I’m Jay Kent, managing director of SLB Performance, a consulting firm that helps companies reduce supply chain costs, implement BI tools, and improve in-stock and customer service. After 25 years of leading some of the most complex supply chains in the industry, I began advising companies in multiple industries and verticals.
It’s important to understand the market to mitigate costs and improve efficiencies. So, twice a month, I’ll share parcel news and thoughts. Be sure to hit the subscribe button to receive the latest newsletter in your LinkedIn notifications.
In addition, on those weeks that Parcel Notes does not go out, we send a market update and analysis email to subscribers. ***If you would like to be added, please DM me***.
In anticipation of increased e-commerce volumes from China, UPS and FedEx increased their ‘surge fee’ and ‘demand surcharge’ between Asia and the US as a way to protect their revenue per parcel.
- According to the Sourcing Journal, UPS reinstated a 29 cents-per-pound surge fee on all shipments from China, Hong Kong and Macau entering the U.S. bringing back an added charge that was in effect for two weeks in March. FedEx followed by implementing a 45 cents-per-pound import demand surcharge on parcel shipments from China, Hong Kong and the Philippines. The FedEx surcharges are expected to remain in effect until May 2, which is the date duty free de minimis trade provision for low-value shipments out of China is officially banned.
Meanwhile, UPS officially introduced its UPS Ground Saver and UPS Ground with Freight Pricing. The announcement noted that UPS Ground Saver is “a reliable, economical shipping solution for less urgent packages, leveraging the UPS Smart Logistics Network.” This is the former UPS SurePost service that USPS performed the last-mile on behalf of UPS until Dec 31, 2024. Meanwhile, UPS Ground with Freight Pricing which is described as offering “less-than-pallet load shipments that weigh more than 150 lbs,” is kind of its former UPS Freight service in partnership with TForce.
- As a reminder, TForce’s parent company, TFI, acquired UPS Freight in 2021. As part of the acquisition, “UPS and TFI International will also enter into an agreement for UPS Freight to continue to utilize UPS’ domestic package network to fulfill shipments, for a period of five years.”
- There are certainly some benefits in regards to both of these services but be sure to understand your other options based on your needs.
Speaking of UPS, the company will announce Q1 earnings on April 29. How well do you think they’ll do?
Expect USPS price increases in July. According to a Axios story, first-class stamp prices could increase by 5 cents. The proposed hike ties the record as the highest stamp increase ever and the third 5-cent increase.
- USPS’ announcement
That’s it for now. Stay tuned for the next newsletter April 30. Don’t forget to hit the subscribe button to ensure you receive it in your LinkedIn notices. In addition, if you like what you’re reading, sign up to receive additional insights and analysis via emails twice a month – DM me for more info.
Most important though, reach out if you’d like to learn how to lower or even possibly eliminate any parcel fees. 📦
-Jay