Parcel shipping was expensive in 2020, especially over the holidays. As FedEx, UPS, and even regional carriers imposed peak surcharges targeted at residential addresses, margins became razor thin. We hoped – maybe even prayed – that this trend wouldn’t continue into 2021, but if there’s money to be made they’ll find a way (I mean, we can’t really blame businesses for making money).
With UPS reinstating pre-holiday surcharges as of January 17, our hopes were dashed. While the first round of surcharges applied to people who shipped 25,000 over their average volume during February, the 2021 UPS surcharges target shippers with a weekly volume of 25,000 in February, period. This amounts to:
- $0.30 per package surcharge for UPS Ground Residential and UPS SurePost.
- $31.45 for large packages of all service levels.
And now, FedEx is following suit at $0.30 per package for ‘large customers’ – averaging over 30,000 packages per week from Jan. 4 – Jan. 31. It’s important to point out that FedEx has not marketed these price bumps as surcharges, save listing them under Peak Surcharges online. But they made sure to note that they are indefinite. The total charges amount to:
- $0.30 per package surcharge for U.S. residential delivery traffic.
- $3 per package for additional handling.
- $0.75 surcharge for SmartPost® package services.
- $30 dollar peak oversize charge.
Rather than shaking an angry fist at the shipping gods, we decided to lean into our mode and carrier agnostic approach to logistics. As Brad Hollister, SwanLeap CEO, reminds us, “We’re not here to beat up carriers to get a better price. It’s about finding the right provider for that shipment at that moment that they need [it].” In other words, there are always more options which is another great reason to diversify your carrier network.
“We’re not here to beat up carriers to get a better price. It’s about finding the right provider for that shipment at that moment that they need [it].”Brad Hollister, SwanLeap CEO
If increased prices are the new normal, shippers need supply-chain optimization to mitigate and insulate from charges. Having access to your granular shipping data is the only way to make decisions that will insulate your company from additional expenses.
But how exactly does technology turn a supply chain under siege into a profit center? The answer lies in a transportation management platform. In fragmented systems data is usually unavailable and even when you get it, it’s cumbersome (in the form of massive excel spreadsheets – parcel data, am I right?).
With a transportation management platform, all of that changes.
Moving beyond the traditional role of the TMS as a label maker to get packages out the door, companies are able to leverage a cohesive platform to manage their transportation and logistics operations. A platform that delivers visibility into cost management. A platform that allows finance to run real-time shipping accruals. A platform where suppliers can fulfill your POs on your rates. A platform where customer service can see the status of every order. A platform that connects with your providers via API and EDI connection, providing instant access to otherwise cumbersome data. A platform that tracks every event within the system and combines that data with data from your providers. Imagine having access to live shipping data in one place. No more logging into various websites to see what is happening. You’d immediately be able to make decisions from trends in shipping to identify savings. Combine that with proprietary freight and parcel auditing technology, and you’ll be able to recapture costs and manage your shipping spend.