How to Save on UPS Shipping

By Shipware | eCommerce, Shipping Knowledge, UPS

UPS is a respected veteran of parcel shipping. Founded in 1907, the brown delivery trucks are well known to anyone shipping or receiving in both the residential and commercial markets. They set standards for the industry, often pushing competitors to match services, network size, and capabilities. Today, there are very few places that UPS or its partners can not deliver a package to. It is for this reason that UPS is one of the most widely used shipping services. 

The expansive shipping service requires a vast network of aircraft, trucking, depot, and even courier assets to ensure both speedy and accurate delivery. This costs money. For most businesses, just starting on parcel shipping, the published rates (“book rates”) are a fact of life. But, as a company grows in activity, UPS negotiates new shipping rates at a steep discount from those published ones. While these discounted shipping rates are a better deal than paying a straight quoted rate, there is more that a company can do to control, manage, and reduce their shipping costs with UPS such as parcel contract negotiation.

If you’re wondering how to save on UPS shipping, you’ll need to focus on 3 areas simultaneously. First, reduce the cost of today’s shipping. Second, understand how changes to the business will affect future costs. And third, include UPS shipping services and its cost structure in your plans for the future.  


1. Invest heavily in standardization.

Standardization, whether it be in processes, data, equipment, or packaging, is key to controlling your daily shipping costs. Standardized carton sizes produce predictable shipping charges. But the standardization of processes and data is even more impactful. Correcting shipping addresses to avoid the address correction or redelivery charges can remove unpredictable costs. Focusing your attention to product information over time will allow the shipping company to better utilize the cartons full size for each order. The key to this is removing variations and ad hoc responses to normal business demands to have high integrity, high efficiency, and high brand recognition.

2. Use the appropriate service

Too often, businesses get into a pattern of habit in their operations. Not from design or data, but purely from ease. UPS provides branded packaging for its Express services at no cost to the shipper when included in their contract. This makes it very easy to pack an order and even label it correctly. But that means the Express service is being used for every order. That includes orders that are going across the state, across town, or even just down the coast. Switching to UPS Ground shipping may get the package there in the same amount of time, with a lower shipping cost. Make sure the level of service matches the company’s customer expectations, but don’t ignore alternative UPS shipping services that meet those expectations at a lower cost.

3. Use the best size packaging 

One of the easiest ways to control sources of the shipping cost for UPS is to minimize the impact of dimensional billing. Dimensional billing is the practice of taking the dimensions of the package to determine the volume, dividing the volume by a factor, and creating a dimensional “weight.” The heavier of either the actual or dimensional weight is then used to determine the charge for a package. 

Addressing the density of packaging into smaller, heavier shipments can reduce the impact of dimensional weight and the disparity in cost produced on carrier invoices. As customer order attributes change, the size of orders in unit count, value, and physical size will change. And as SKU catalogs grow in size as companies expand offerings, again the carton sizes, weight and even quantities per order will also change. Thus, revisiting the optimal packaging for business is a constant, everpresent investment that can yield results. Ignoring the shifts in this area will only cause more expenses.


Next, factoring in the practices and structure of the pricing contract to future plans is required.

1. Know when and how minimum shipping charges apply

The pricing zone charts of UPS can be misleading. When the shipment is small or going a shorter distance, instead of the listed rate in the zone chart, a minimum shipping charge is used. Couple this with the dimensional weight aspect, and it is easy to expect a shipment to be charged at a much lower rate than the invoice eventually shows. 

Often, companies focus on negotiating the rates of the zone charts based on their activity, but do not understand where the minimum charges come into use. If other forces in the customer arena like smaller, more frequent shipments, new product lines, or even subscription service style routine shipping occur, the minimum may impact more than it has in the past. Knowing where and how minimum charges are applied to rates is crucial for near term planning, especially as daily business evolves.

2. Know which surcharges are applied and why

Surcharges are not all occasional fees for unusual service. Yes, surcharges like international redelivery fees are exceptions to normal costs. But others are more present or predictable and, therefore, controllable. For example, fuel surcharges apply to every shipment while others apply depending on the recipient’s address, such as the remote, extended, or delivery area surcharges. But some are more difficult to predict and therefore control. The additional handling surcharge is applied for oversize shipments and cartons. Whether a depot charges it for a specific shipment is up to the supervisors and staff of the depot and other surcharges are specific to how UPS classifies an address. If the recipient is in a residential area and therefore is not on the route for commercial deliveries, residential surcharges may be applied. 

What complicates this is that these surcharges will differ between ground, air, international, and freight services. It is difficult to know which surcharges will be used for new business, new locations, and even seasonal shipping shifts. While the base rates for shipping are more easily negotiated, surcharges often end up being a significant line item in the shipping budget. Controlling the occasional, minimizing the consistent, and avoiding the obvious surcharges are key to handling the ebb and flow of shipping costs in the near term. One way you can control the costs on your invoice is by conducting a parcel audit. This allows you to review each line item and get refunds on shipping costs.


Finally, the details of the contract and the capabilities of UPS should be considered in strategic plans.

1. Determine the ideal facility locations based on activity

The data collected by UPS during shipping operations is both specific and large. Every shipment, every charge, and every package is tracked and logged. This information can be used to determine many things about future plans of a company. The pattern of carton weights can help determine if shipping charges are too high and an incentive program to increase shipment weight would help margin. The level of shipping correction charges can help determine the quality of data entry and lead sources. 

One of the most useful, and often ignored, is the volume activity from each UPS shipping site. Remember that zone maps are specific to the shipping location. What is considered a zone 3 for one site is considered a zone 6 for another. The value is in analyzing where shipments go for each site and the similarities or differences in the shipments. A company expanding into eCommerce will begin to ship smaller shipments to customers. Often this is done from the largest, most experienced, or most flexible existing location. But looking at the data from UPS can suggest a new location to reduce ecommerce shipping costs. And by segmenting the data by weight, it may suggest a location best for ecommerce different from the older style commercial shipments. This is all contained in the data UPS has about each company’s shipping volume.

2. Focus on increased volume to earn better discounts

Due to the factors of dimensional weight and minimum charges, there is a tendency to focus on increasing non-parcel shipping, shifting to LTL when possible. To really save more money on UPS shipping charges, however, the key is to increase the amount of parcel shipping across all services and zones. UPS offers tiered discounts based on the total amount a company spends. The more spent, regardless of how, the more the company earns in a flat rate discount. This creates an incentive to both concentrate the shipping of parcels with UPS and to explore more options and services for new business. Services like cross-border consolidation, customs clearance, even LTL deconsolidation may allow more shipping expenses to be funneled through UPS, increasing the savings.

3.  Consider alternate forms of shipping 

Over the years, UPS has added new forms of shipping services to meet both service and cost demands of its customer base. From early A.M. Next Day Air services to Surepost to even hundredweight shipping, there are many options for any company shipping parcel. When planning for new products, locations, customers, or even distribution models, it is best to consider more than just the obvious services from UPS.  

An excellent example is the UPS Surepost service. This shipping service uses the United States Postal Service (USPS) for the actual delivery to the destination but the UPS distribution network for the major portions of the transport. It exists as a costconscious alternative to pure UPS ground shipping service. When considering future business operations, companies who need a low cost, non-delivery datespecific services should consider Surepost. This is a great shipping option for the sending of spare parts, large scale kit distribution, and high volume seasonal shipments such as subscription services. 

Knowing the alternatives that UPS has internally for each shipping need can help make costsaving easier while not endangering the discounts and negotiated rates already in place.

4. Renegotiate your contract

9 times out of 10, volume shippers are overspending in their UPS contracts. As you can see, there are so many factors that contribute to your overall shipping costs. Parcel contract negotiation allows you to re-evaluate your contract and get the most out of your contract. With experts like Shipware, you have inside knowledge of the carrier industry to help you save on UPS shipping. Shipware works on your side, negotiating for the rates that your carrier isn’t telling you about. For more tips on contract negotiation, check out our guide on how to prepare for parcel rate negotiations.


UPS is not only an experienced handler of parcel shipping, but a large network of services and capabilities. To actively save money using their services, focus needs to be maintained on current operations, planning for the near term, and including UPS and its structure for future operations. For more information, contact a professional from Shipware today.

July 22, 2019 Sunnyvale / CA / USA - UPS

UPS Announces 2020 General Rate Increases (GRI)

By Shipware | News, Rate Increases, UPS

Effective December 29, 2019, UPS Ground, UPS Air and International services rates will increase by an average of 4.9%. Keep in mind that there is often a discrepancy between the announced increase and the effect the increase has on individual shippers.

Our team at Shipware will perform a detailed analysis of the announced increases over the next week, but in the interim, here are some areas which will likely provide the most impact:

1. Longer zone UPS Air services will take larger increases, while all ground zones will take similar increases. Shippers are more likely to utilize longer zones in the express networks, as the ground networks become more efficient in accomodating 1-2 day transit times in the lower zones, so it is likely that heavy UPS air shippers will take larger increases. Following is a comparison of Air to Ground:

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2. Two and Three day shipping have larger increases than other services. This will negatively affect shippers with day-definite (but not overnight) shipping needs. Increases are consistent across weights for air services, but generally increase by weight for ground services.

Screen Shot 2019-11-19 at 3.37.18 PM

Full weight/zone breakdown of ground services increase:

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3. The ground minimum package charge (zone 2, 1 pound list rate) has increase by 4.84% to $8.23, which mirrors FedEx. Following a full breakdown of minimum charge increases by service:

Screen Shot 2019-11-19

4. SurePost increases are much lower from 1-9lbs (2.2%) than at 10+lbs. (5.3%). This will allow the UPS SurePost list rates to better compete with FedEx SmartPost list rates, although the SurePost rates remain higher by approximately 3-4% from 1-9lbs.

5. UPS has followed FedEx in placing a new emphasis on “Extended” Delivery Area Surcharges (DAS). Zip codes designated as extended delivery areas will incur a much larger increase than their non-extended DAS counterparts. Refer to the full table below for the full breakdown of the increases.

  • Standard DAS increases range from 1.2% – 5.3%
  • Extended DAS increases range from 11.3% – 23.2%
  • Note that DAS/Extended DAS zip codes have changed. Refer to the changes here:

6. UPS has added new accessorial charges for 2020: Rebill fee, Prohibited Item Fee, Item 86 Fee:

  • A Rebill fee ($17) will be assessed for each request to change the billing account for a shipment.
  • A Prohibited Item fee ($150) will apply to packages containing prohibited articles or restricted articles not in compliance with all UPS policies and procedures, and applicable laws and regulations if found in the UPS system.
  • A processing fee ($10) will apply to each request to file a single entry under Entry Type 86 for a shipment that normally qualifies for U.S. customs clearance under a consolidated manifest.

This table shows accessorial increases for UPS’s most commonly assessed charges:

Screen Shot 2019-11-19 at 3.50.18 PM

Also, effective December 29, 2019, new surcharge ratings will occur:

  • Value-added services and other charges will apply to undeliverable packages returned to the shipper.
  • UPS reserves the right to assess a late payment fee in an amount set forth in the UPS Tariff/Terms and Conditions of Service if an invoice is not paid in full by the invoice due date.
  • The weight threshold for applying an Additional Handling surcharge will be lowered from 70 pounds to 50 pounds actual weight for UPS Ground and UPS Air services.

How will this affect individual shippers? The general rate increase will affect some shippers more than others. If you’re a shipper that routinely uses two or three day, long-zone express, or ships to remote areas, it is likely that you will be subject to an increase much larger than the stated 4.9%.

As is the case with each annual rate increase, it is vital to understand how all changes combined will impact your individual characteristics and, ultimately, your overall shipping costs. However, understanding the financial impact to your organization is not a simple or straightforward analysis. If you would like an in-depth understanding of how UPS’s 2020 increase will affect you, Shipware will perform a complimentary and customized analysis for your organization. Email to learn more.


Matt Bohn,
Senior Consultant, Professional Services
Shipware, LLC

Matt Bohn is a Senior Consultant, Professional Services at Shipware, LLC, where he works to optimize carrier contracts for high-volume shippers. Matt has nine years of previous experience as a Revenue Management Advisor at FedEx, where he analyzed and developed contracts for some of FedEx’s largest eCommerce shippers. Matt has transitioned to helping similar shippers dramatically reduce their shipping costs. He can be reachesd at

Woman taking gift box out of parcel indoors

UPS Eliminating Residential Peak Surcharges For 2019

By Shipware | News, UPS

Residential surcharges can make business more difficult during the holidays. Whether a company is offering free shipping to customers or charging customers for the service, the additional fees add up quickly and can impact the bottom line as well as customer orders. Shippers can rejoice that this 2019 holiday season, UPS eliminated the residential peak surcharge.

No need to throw a parade though, this UPS announcement is just for residential deliveries. Other peak surcharges are waiting for the start date to begin, and UPS is raising international air-import fuel surcharges as well. Here’s the scoop.


UPS Peak Surcharges


Look for UPS peak surcharges on contractual exceptions and those requiring special handling. These are packages that require manual processes or off-line handling.

Shippers will find UPS peak surcharges assessed on all U.S. domestic, U.S. import and U.S. export service levels for all domestic and international destinations during the peak periods, for these amounts, services and dates:

  • $3.60 per package for Additional Package Handling, from November 24, 2019 to January 4, 2020
  • $31.45 per package for Large Packages, from October 1, 2019 to January 4, 2020
  • $250 per package for Over-Maximum Limits, from October 1, 2019 to January 4, 2020

UPS describes how these services are determined in its UPS Rate and Service Guide.

Though the UPS Rate and Service Guide will have all the details, Additional Handling basically includes these categories: weight (more than 70 pounds); length (longest side exceeding 48 inches); width (second-longest side exceeding 30 inches); packaging (not fully encased in cardboard – including cylindrical items; those routed through UPS’s irregular package sortation process; anything else UPS determines should fall into this category).

Large Package surcharges are assessed for these categories: domestic shipments where length (longest package side) plus girth [(twice the width) plus (twice the height)] equals 130 inches, or its length exceeds 96 inches; and international shipments meeting all domestic criteria except for length exceeding 96 inches.

UPS will not assess both a Large Package surcharge and an Additional Handling surcharge.

Over-Maximum limits include packages with actual weights of more than 150 pounds; exceeding 108 inches in length; or exceeding 165 inches in length (longest package side) plus girth [(twice the width) plus (twice the height.)]


Why UPS Is Eliminating Residental Peak Surcharges


As one of the major carriers, UPS again expects a record number of deliveries this 2019 holiday peak season. They’ve been revamping their facilities. UPS said they can handle 700,000 more packages each hour with their retrofitted or newly built automated sortation facilities. These Super Hubs and updated processing/delivery facilities should accommodate more than 75% of the eligible packages during the 2019 holiday season, and 100% of that eligible volume in 2021. As part of their capital investment plan, they are also upgrading air and ground capacity. During 2018 and 2019, they increased their fleet of 747-8 and 767 aircraft by 20, and there are orders for two dozen more planes to arrive by 2022.

Not surprisingly, UPS, FedEx and USPS are trying to increase their delivery speed and keep fees in check. That’s to compete against Amazon, which for the past number of years, has been disrupting not only retailing, but shipping with its Prime two day delivery (or less) model. This year, UPS also announced it was expanding its pick-up and delivery service to daily service, along with later pick-up times for next-day UPS Ground delivery, and more pick-up and drop-off partners. They added more services for lower priced international deferred shipping as well.

During the 2018 peak season, UPS applied a residential surcharge while competitor FedEx did not assess a 2018 peak season residential surcharge for the second year in a row. That said, the rates for the UPS Additional Handling surcharge, Large Package, and Over-Maximum Package surcharge are higher in 2019 than they were in 2018. These increases could more than make up for the UPS peak residential surcharges charged in 2018, at $0.28 per package for ground shipments, $.84 for Next Day Air and $0.99 per 2 Day Air shipment, especially to put them on a more level playing field with FedEx.


International Air-Import Fuel Surcharge


Speaking of surcharges, in August UPS also announced they’re increasing the Air-Import Fuel surcharge by 1% for all thresholds. They will continue to adjust them weekly, based on the surcharges for national Average U.S. Gulf Coast Jet Fuel Price.

The Air-Import Fuel surcharge ranges from 9% when jet fuel is between $1.58 and $1.61, to 12.5% when jet fuel is between $2.00 and $2.03. UPS account holders will find the fuel surcharge on their weekly bill. UPS customers who only use the service occasionally and don’t receive a weekly bill will see the addition in their charges.


About Shipware


Shipware delivers volume parcel and less-than-truckload shippers intelligent and innovative distribution solutions and strategies. Whether you ship with FedEx, UPS, USPS or regional carriers, our invoice audit and negotiation services are guaranteed to reduce your parcel and LTL shipping costs by 10 to 30 percent, with no disruption of current operations. Our team of experts has more than 200 years of carrier pricing experience. We have negotiated thousands of FedEx, UPS and LTL contracts – saving our clients an average of 19 percent.

Steps Shippers Can Use to Monitor UPS Costs

5 Steps Shippers Can Use to Monitor UPS® Costs

By Shipware | Contract Negotiation, UPS

After months of contract negotiations between UPS and the International Brotherhood of Teamsters, the union’s chief negotiator announced that the union had reached a tentative agreement. 

The UPS contract update offered a starting wage of $13 an hour, with no extra raises for current part-timers. This is despite the fact that going into bargaining, the biggest demand from the overwhelmingly part-time inside workers was for a $15 starting wage, with catch-up raises for people who’ve been underpaid for years. Though 54% of UPS workers voted “no” to prevent the tentative agreement from being ratified, Hoffa’s Package Division Director, Denis Taylor created massive confusion by announcing that the UPS contract was ratified.

While the UPS contract update debacle is not yet over, it seems UPS seeks to recoup its increase in wages from shippers. The carrier announced a 5.9% general increase rate for 2019 and increased several surcharges. Below are highlights from UPS’s new rates.

  • Over Maximum Limits charge increased $200.00 for packages that weigh more than 150 lbs., exceed 108 inches in length, or exceed a total of 165 inches in length and girth combined.
  • Additional handling surcharges increased by nearly 19%, depending on the type of additional handling incurred (length, width or based on packaging).
  • Third party billing fee, increased from a 2.5% fee to 4.5% – an 80% increase year-over-year.
  • Large package surcharges increased for commercial delivery addresses, rose from $80 to $95 – a 19% increase. Large package surcharge for residential shipments rose from $90 to $115 – a 28% increase.

In a world where free shipping determines who consumers shop with, these new rates may lead to high shipping costs and ultimately cart abandonment. Therefore, to retain your customers and remain competitive you need to renegotiate your UPS contract. Since UPS contracts are complex and complicated, here are five contract negotiation tips to ensure you get the best rates from UPS.


5 Steps to Keep Costs Down

1. Review Surcharges

While surcharges make a significant part of UPS’s revenue, the good thing is that they are negotiable. The first step to prevent surcharges from eating away your profit is to be aware of the different types of surcharges UPS has, and understand how these surcharges impact your shipping costs.

Carry out a freight audit to understand how much you are paying for surcharges, what those surcharges are, and when they are being applied. Look out for surcharges that have the greatest cost impact on your costs and target them for waivers or reductions. If any surcharges are unclear, ask for your carrier rep for clarification.

UPS surcharges are often added to your invoice after the shipment has been made, so they can be difficult to monitor. So to keep tabs on your surcharges, review your shipping invoice to see how many additional components your shipping bills contain, identify surcharges that do not apply and filter them out when negotiating your contract. In view of the fact that tracking your surcharges yourself can be time-consuming, consider outsourcing this task to a third-party logistics provider.


2. Have A Benchmark

While you cannot prevent carrier reps from talking about how great UPS rates are, you can gauge how good the terms and structure of your contract is by benchmarking. Benchmarking allows you to compare your contract components against your peers and gives you an idea of what a fair rate is. This prevents you from leaving money on the table and increases the likelihood of negotiating the lowest rate possible.

Although UPS benchmarking information is not made readily available to shippers, you can find out what kind of pricing or discounts your peers have negotiated by having conversations with peers in your industry, using feedback from carriers, or contacting third-party logistics firms offering benchmarking information and consulting.

The discounts UPS gives are largely based on the carriers’ analysis of a shipper’s profile and other factors that are directly tied to the carrier cost drivers. So use data analytics to identify shippers in your industry that you share similar shipping profiles with and use them to determine the right benchmark. Also, select specific Key Performance Indicators to benchmark to ensure the right questions are asked and that the relevant measurements are used.


3. Know Your Shipping Profile

To remain profitable, UPS relies on advanced analytics and artificial intelligence to analyze your shipping profile and determine what discounts to offer you. However, you can outsmart the carrier by having more knowledge about your shipping profile than UPS does and using your insights to find opportunities for negotiation that match your shipping profile.

When building your shipping profile, use advanced analytical tools to gather data points such as weight distribution, delivery density, and surcharge spend. Also, ensure your data is accurate and complete, and track your data sources in real time to create a detailed portrait of your company’s shipping habits. To translate data points within your carriers’ invoices, pricing agreements on a granular level, use advanced analytical tools. This will enable you to visualize your data, have a 360-degree view of your shipping, and identify which aspects of your contract aren’t working for your business.

Once you have a clear picture of your shipping profile, find out what factors UPS considers when determining how far they can move on price and tailor your negotiation in a way that shows UPS your shipments are valuable. For instance, size doesn’t always matter to UPS. The carrier is more interested in how your packages travel through their network and how cost-effectively they are able to get them from point A to point B. So if your shipping profile shows your location matches delivery routes and critical distribution hubs, you can negotiate on price.


4. Use Other Carriers As Leverage

Carriers classify pricing requests into one of three customer categories:

  • Retention: The current carrier keeps the vast majority of the available business.
  • Penetration: The carrier already has the majority of the business but has the chance to gain more volume.
  • Conversion: A new customer where the carrier has little to no presence.

Since loyalty often goes unrewarded in carrier-shipper relationships, you need to make UPS work to retain your business. And this means acting like a conversion customer. Because conversion customers are prepared to move their volume from one carrier to another, carriers give them large discounts as means of enticing them to move their business. In view of the above, leverage alternative delivery providers such as USPS, and regional carriers when renegotiating your contract with UPS. Having multiple carriers on your bid gives you leverage when negotiating and can create the necessary pressure to shift UPS into business acquisition mode and get you the best rate for your shipments.

You can request for quotes from carriers or use shipping comparison sites to find what alternative delivery providers charge for shipments and leverage the variance to negotiate a stronger deal from UPS. For instance, you can ask UPS to match FedEx fuel surcharges or wave your third-party billing. While UPS might not immediately be able to match some of the services or network alternative carriers have, you can get UPS to provide special pricing to offset any perceived service disadvantage. When using this negotiation strategy, keep in mind that you may not be able to get an apples-to-apples comparison. So look at the full picture of each contract and assess which will be the most beneficial to your business.


5. Get External Help

While a DIY approach is a good idea for crafts, it is not the best strategy to adopt when renegotiating your contract. Carriers are trained to sell shipping agreements that maximize profit and shift focus to value-add services that don’t apply to your shipping profile. So, having an employee without a sound background in contract negotiation handle your contract won’t help much in unlocking a reduction in your shipping costs.

Rather than leaving your contract renegotiation to your employees, consider bringing in a third-party consultant to help with your negotiations. Armed with industry experience, consultants negotiate dozens of contracts yearly and can help you to identify the best parts of your agreement to target: specific surcharges, or price floors. 11% of the top parcel shippers in the US have hired supply chain consultants to negotiate their FedEx, UPS, DHL contracts. And these shippers report that parcel consultants reduced shipping costs as much as 49% lower from what the company had been able to negotiate on its own.

When selecting a consultant, look for one that uses a data-based approach in analyzing parcel agreement and freight spend. Also, consider a consultant that can help you select a new carrier, execute a new contract and validate the accuracy of your new contract if you decide to switch carriers.


Don’t Leave Money On The Table

Aside from the above tips read the fine print, review your maximum spend and have a strong relationship with your carrier rep. Keep in mind that negotiating a profitable contract is just the beginning. Ensure UPS keeps up with your new contract terms by reviewing every invoice to make sure rates and fees are correct and that every package is delivered on time. If you cannot handle your contract renegotiation, Shipware can review your parcel and freight invoice and uncover where you are overspending and auto-identify incorrect surcharges, using our invoice audit recovery platform.


UPS® vs. FedEx® for International Shipments

By Shipware | FedEx, Shipping Knowledge, UPS

If you’re sending items internationally, you’re entering an even more complex shipping world than the domestic one you may already know. According to FedEx, 30% of all U.S. export shipments are from small businesses, which also make up the fastest-growing segment of U.S. exporters. Whether your company is a small, medium or large business, not understanding the various shipping options can be costly.

There are a lot of factors to consider when determining the best carrier for international parcel service, UPS vs. FedEx. In this post, we dig into those factors to give you a better idea of which service might be better for your business, or at least which ones you’ll want to focus on as you investigate the pricing and delivery options most important to you.

A warning: the services these carriers offer can sound the same, with terms like Worldwide Express, Worldwide Express Plus, Express Critical International, International Priority, International Economy, International Priority Freight, International Economy Freight, etc. The good news is there are many options. But the bad news is that comparing the services takes a lot of time and effort.

Rates to Ship Internationally

It’s impossible to provide a thorough description of every rate and package type for every service offered by UPS vs. FedEx. Know that the general rack rates of UPS vs. FedEx are pretty similar. Rates can change depending on the discounts your company negotiates, making an apples-to-apples comparison impossible. Your international parcel service rates may be different than a neighboring company shipping the same size or weight package.

UPS offers a handy at-a-glance chart with shipping services with icons showing special delivery options like Saturday service, returns/exchange service, and electronic export information. You can sort by earliest arrival or service name. FedEx also offers a listing of its service types, paired with basic shipping needs, like early delivery to key global markets, delivery in 1-3 days worldwide, or economical delivery to Canada. This makes it easier to narrow down services.

Rate Calculators

When in doubt, you can plug your package information into each company’s rate finder, to determine the cost and delivery options for individual packages. This is helpful when your shipping needs don’t fit your typical shipping patterns, or if you infrequently ship outside the U.S. Remember that the shipping rates quoted or listed may not be final, as the carriers retain the right to determine the weight and size on their own, there may be additional delivery charges, currency conversion fees, and the inevitable fuel charge, the price changing by the week.

The FedEx rate calculator will also give transit times for the chosen service or services, and you can choose a quick or detailed quote. You can also call FedEx International customer service at 1-800-GoFedEx for rate help as well. Of course there’s a similar UPS rate calculator, offering shipping rates and international delivery times for that carrier.

Dimensional Weight

FedEx and UPS sometimes use different dimensional (DIM) weight factors. For international shipping services, both use the greater of the DIM weight compared to the actual weight, for billing. The actual package weight is rounded up to the next whole pound. The DIM weight is the length in inches, multiplied by the height in inches, multiplied by the width in inches, divided a denominator. UPS applies 139 as a denominator for daily rates or 166 for retail shipping rates. FedEx only divides by 139 for international parcel shipping rates.

Additional Fees

The quoted shipping rate may not include additional fees, just as domestic shipping also has additional service fees. Some are the same types of fees, such as fees for signature upon delivery, proof of delivery, dangerous goods, Saturday delivery, Saturday pick-up, additional handling, address correction, fuel surcharges, out-of-delivery area, invalid account number, and residential delivery. But there may be unique fees for international services, such as electronic export filing, ancillary clearance service, and duties and taxes. Not all fees will be charged on all shipment types – as always it pays to check the FedEx Service Guide or the UPS surcharge list.

Number of Delivery Countries

Both FedEx and UPS ship to more than 220 countries and territories. A FedEx international service map highlights which international services are available in which locations. UPS notes that they ship to every address in North America and Europe. Not all shipping services are available for all international locations, so that may be an issue when choosing a carrier for a specific package. The rate calculators will not allow you to select a location where the company doesn’t offer that service type.


When looking at UPS vs. FedEx tracking, know that both carriers offer multiple tracking methods. UPS tracking lets you track by reference number, on a mobile app, chatbot on smart speakers, Facebook Messenger and Skype. You can log into your UPS account to track up to 75 of the most recent shipments, and you can store 50 tracking numbers in a recent history table. In addition, UPS offers Quantum View Manage, a software program for small to mid-size businesses with light to heavy international (or domestic) shipping needs. It provides a consolidated view into shipping status and reporting tools, with information potentially viewable by customers as well.

FedEx tracking also offers a myriad of options. That includes tracking up to 30 shipments from pick-up to drop-off, using tracking numbers, account numbers, order numbers, or door tag numbers. FedEx’s version of the small/mid-size business software is called FedEx Insight, allowing tracking across multiple accounts and locations. The FedEx Desktop program lets you receive shipping notifications and to send/receive email tracking results. FedEx offers a mobile app as well. Lastly, FedEx has a global tracking page for searching individual tracking numbers.


Sending a package across the country is concerning enough, but it can be worthwhile to insure packages delivered globally. FedEx’s limit of liability is $100 for international packages without additional coverage. For FedEx insurance, expect to pay $1 per $100 of declared value, or $9.07 per pound, whichever is greater.

UPS covers most international parcel shipping with a declared value of $100 or less, at no cost. Companies can declare a value up to $50,000 per package, and insurance generally costs $1.05 per $100 over the base amount.


Both companies offer money-back guarantees for most services. FedEx offers a money-back guarantee if they miss their published or quoted delivery time, though customs delays negate that. If they are passing off the goods to another carrier (cartage), FedEx only guarantees international delivery times for the FedEx service portion. This would relate to freight service. UPS also offers money-back guarantees for Worldwide Express Shipping. Both carriers reserve the right to suspend guaranteed delivery dates during peak seasons.

Membership and Discounts

Both FedEx and UPS offer discount programs. FedEx offers a number of ways to take advantage, including using AmEx as your billing credit card, or via other affiliate programs. The FedEx Business Perks membership program offers up to 28% discounts on a variety of international FedEx Express services, as well as up to 15% discounts on FedEx Ground and FedEx Home Delivery services. Your business will have to show qualifications for whatever program it wants to join, which could be as simple as providing proof of listing in a local directory.

UPS offers small business shipping discounts as well, basically by signing up online. Your business can save 40% on international air shipments through your UPS account. Their small business program offers additional savings benefits, including discounts on packing, printing, shredding, mail/package receiving and notary service.

Customer Service

Which offers better customer service options, UPS vs. FedEx? We’d probably go with FedEx, at least for online help. FedEx offers a long list of links for specific information, that an international shipper might need to consult. That ranges from learning more about shipping international freight, to tracking the status of an international package, to instructions for creating international shipping documentation and labels. They offer a similar list of FedEx phone numbers for international shipping. UPS has contact information and some support on its international customer service page as well.

How Shipware Can Help Negotiate Shipping Rates

Does this guide leave you more informed, more confused, or both? Shipware can help. With shipping, rates change depending on the contract. The experts at Shipware have deep experience in-house on the carrier side, and know what terms can be negotiated and by how much. We’re likely to get you lower contracted rates than you can get on your own, whether negotiating shipping incentives, surcharges, or changing the denominator for DIM weights.

Even without negotiating rates, though, Shipware can save you money by ensuring that your company is capturing the savings from any unmet carrier service guarantees, or via improper billing. Our services pay for themselves out of that savings, leaving companies with no out-of-pocket expenses for the services and no additional work once the system is set up. We offer new customers the opportunity for a free audit to see how much we can save your company in shipping payments recovery. If we don’t save you money, we will give you $10,000. There’s nothing to lose and everything to gain.


UPS Announces 2019 Rate Increases

By Rebecca Lannon | News, Rate Increases, UPS

Shipware Preliminary Analysis: What You Need to Know

United Parcel Service (NYSE: UPS), will increase shipping rates effective December 26th, 2019 by an average of 4.9% for UPS Ground, UPS Air & International services while UPS Air Freight rates will increase by an average of 4.9% on December 27th, 2018. The change will impact the following:

  • UPS Daily Package Rates including UPS Ground, UPS Air, and UPS International services
  • UPS Alaska and Hawaii Daily Package Rates
  • UPS Retail Package Rates including UPS Ground, UPS Air, and UPS International services 
  • UPS Hundredweight Service Package Rates 
  • UPS SurePost Rates
  • UPS Air Freight Rates
  • U.S. Origin UPS Express Freight Premium Direct Rates

In addition, there will be changes to UPS surcharges and minimums also effective on December 26th.  Notable of those changes for 2019 include the following:

ups 2019 rate increase_shipware

Here are some highlights from the announcement, showing the changes to some of the more common surcharges, along with the percentage increase.  In recent years, the largest increases continued to be reserved for those surcharges related to package size and dimensions, and this year we also see US increasing the Third Party Billing Fee by 80%!

Take a closer look at Additional Handling, Large Package Surcharge and Over Maximum Limits. UPS increased these accessorials during the 2018 General Rate Increase in December 2017 and then again in July 2018, and all 3 are going up again. Additional Handling Weight has increased over 91% in 12 months! 

The comparison below of 2018 rates to 2019 rates shows the actual impact by service and weight break. In many cases, the actual increase is over 5% – even as high as 9.34%!

An analysis by zone reveals that the increases deviate from the 4.9% mark quite a bit. SurePost<1lb is taking the biggest hit with zone 2 increase of 9.87%.

This year, UPS is giving its customers only 3 weeks’ notice of the 2019 increase whereas many contracts state that there must be a period of 30 days’ notice. Some of the most notable changes in 2019 will be the following: 

  • Fuel surcharges will now apply to more surcharges than ever before.  Included among those are Additional Handling, Over Maximum Limits, Signature and Adult Signature Required.
  • Fuel surcharges are scheduled to increase, but details won’t be available until 12/27/2018.
  • UPS will charge a processing fee when Package Level Detail (PLD) is not provided to them prior to delivery.

Both UPS and FedEx continue to create a more complex pricing environment year over year. Many shippers understand that there is usually very little correlation between the carriers’ announced average increase and the actual increase by service level, zone and weight.  The impact to their parcel budget can vary significantly from the announced average increase depending on their shipper profile. A more thorough analysis by Shipware’s team of consultants will be forthcoming. 

These increases will significantly impact each shipper; however, the increase in overall cost will vary per each shipper’s unique shipping characteristics. Please contact us if you would like a custom analysis to understand the exact impact these changes will have on your business.

UPS shipping insurance

Getting Started With UPS Shipping Insurance

By Shipware | News, Shipping Knowledge, UPS

Shipping is a critical link to customer satisfaction. Once a customer purchases a product, they expect it to arrive on time and in good condition. And if a package goes missing or arrives damaged, the customer expects a fast resolution. The first step is calling the carrier and attempting to track down the package, but when that fails, making it right with the customer becomes the central focus, often leading to replacing the product and shipping it quickly.

After ensuring that the customer is happy, the company is left with the bill, and it’s at this point that freight insurance comes into play.

The majority of carriers, including UPS, offers shipping insurance to bridge the gap when an unexpected event occurs. And with 5.1 billion packages circling the globe annually, shipping mishaps do occur. Understanding how to get started with UPS and figuring out UPS shipping insurance cost helps minimize your losses and ensure that the process moves more smoothly. 

Shipping Insurance: Understanding the Basics

Shipping insurance is a service that offers financial reimbursement if a package is lost, stolen, or damaged during the transit process. Most carriers provide a basic level of insurance. However, if you’re shipping a high-value item, you may want to consider purchasing additional insurance.

UPS automatically covers most packages up to $100 for both domestic and international shipments. Additionally, UPS provides declared value coverage for an additional fee for packages that exceed this amount. There are limits on the amount of insurance that can be purchased, which is currently set at $50,000 per package or $100,000 per pallet.

Some types of domestic packages have higher limits, such as a maximum declared value of $70,000, depending on the contents of the package. There are also limitations on what qualifies for coverage, and we’ll discuss those shortly. The cost of the insurance has risen slightly each year, and current rates can be found on the UPS rate and service guide page.

Shipping insurance is a necessary option if you’re sending valuable goods or a one-of-a-kind item with UPS. Even if the cost of goods is minimal, the no-cost insurance that UPS provides can help with replacing the item in the event of lost or damaged package.

UPS Shipping Insurance, Shipware freight audit software

Understanding Declared Value

When filling out a UPS shipping form, you’ll see a spot for the declared value of the item. Additionally, a UPS worker might ask you about the value of the item when you’re purchasing additional insurance for a package. So what is this referring to?

The declared value is the amount of money that you state the package is worth. This doesn’t take into account the packaging materials or the cost of shipping, but simply accounts for the value of the item. During the claim process, this is the amount that is considered when determining the payment for the claim. Supporting documentation may be required during the claims process, but when purchasing insurance, you simply need to state the value. According to UPS, the declared value is the lowest of the following amounts:

  • The cost of repairing or replacing the merchandise up to $100 if there is no value declared in excess of $100
  • The cost of repairing or replacing the merchandise up to the declared amount if the package had a declared value

The cost paid is the actual cost of the damaged or lost property, and the replacement cost includes the amount charged for repairing or replacing the item. Repair quotes are UPS’s responsibility; however, you may provide a third-party repair evaluation. If the third party says the item can’t be repaired, the actual or replacement value will be paid up to UPS’s maximum liability.

The Fine Print of Shipping Insurance

Shipping a product includes many expenses, including the employees’ time, the packing materials, and the cost of freight. Additionally, there is the actual cost of the product. UPS only pays the actual cost of the product should an unexpected shipping event occur. The cost of these other items are not included.

That’s why it’s a good idea to read the fine print to fully understand what’s covered and what isn’t when purchasing shipping insurance. For example, if you have purchased additional insurance coverage, you don’t want to later learn that an item is excluded when making a claim. A number of items are excluded from the company’s insurance, such as coins, cash, or precious stones. Other carriers, such as Federal Express and the United States Postal Service, have similar exclusions.

UPS has other limitations based on the type of commodity that is shipped, which are outlined in the “liability limits” section of the UPS/Tariff Terms and Conditions. According to UPS’ website, common items and applicable restrictions include the following:

Checks: If a package containing a check is lost or damaged, UPS will not pay for the face value of the check. UPS’s liability for a package containing a check or checks is limited to the cost of stopping payment on and reissuing the check(s), not to exceed US$100 per package.

Phone Cards, Tickets, Gift Cards and Similar Cards: UPS’s liability for a package containing a phone card, ticket (such as an event or airplane ticket), gift certificate, gift card, coupon or other similar printed matter with an exchange value is limited to the cost of replacing the physical card(s), certificate(s) or printed matter, not to exceed US$100 per package. As with checks, UPS is not liable for the face value of any phone card, gift certificate, gift card, coupon or similar printed matter.

Media: UPS’ liability for loss or damage to a package containing documents, film, photographs (including negatives), slides, transparencies, videotapes, compact discs, laser discs, computer tapes and media of a similar nature is limited to the replacement cost of the media on which the content is recorded.

Pairs, Parts: In the event of loss or damage to a pair or set of articles, UPS’ liability is limited to the value of that part of the pair or set that is lost or damaged, and UPS shall not be liable for the value of the whole pair or set. In the event of loss or damage to any part of the property (including any part of a machine) that, when complete for sale or use, consists of several parts, UPS shall be liable only for the value of the part lost or damaged, not to exceed the declared value of the part lost or damaged. In no event shall UPS be liable for the value of the complete item.

Insurance limitations may also apply to the shipping location. Check with UPS to ensure that if you purchase additional shipping insurance, the area where you are  shipping to is covered, especially when shipping items internationally.

Packing Rules and Restrictions

One more thing to consider is insurance packaging. For example, let’s say that an employee improperly packages an item. When the item arrives at the customer’s address, it’s damaged. You replace the item and then open a claim with UPS. The carrier will likely request to see the shipping packaging, and upon review, may determine that you did not follow their requirements for packing the item, and are therefore not protected under the insurance program.

UPS uses a third-party vendor to manage this process for insurance claims that exceed $100, and the vendor adheres to the small package carrier standards, known as the ISTA 3-A packaging guidelines, to analyze the integrity of the packaging job.

For example, one requirement is that you “always use new or like-new packaging.” That means that if a low-quality box is used, damages during transit might not be covered.

What to Expect When Filing a Claim With UPS

A customer calls your business, angry because a package is late or has never arrived. A quick investigation with UPS determines that the package cannot be located. This is a rare event, but one that requires quick action. A replacement product is sent to the customer with an apology to ensure that they aren’t dissatisfied. But at this point, you’re left dealing with recovering the loss.

As soon as you suspect a package is lost or stolen, file a claim with UPS right away. UPS gives domestic shippers up to nine months to file a claim (60 days for international shipments); however, filing a claim quickly will ensure that you have all the documentation the carrier might request, including supporting documentation such as photos of the item, or information about the value.

The first step that occurs when filing a claim for lost package is the search. If the package is not located, UPS sends a letter that authorizes the claim. At this point, documents are sent to the third-party company UPS uses to process claims. Once the carrier has the documentation, the process unfolds quickly. On average, UPS says the process is typically completed within five to 10 business days. 

It’s also important to note that replacement of a product may not be provided when an item can be repaired. For example, let’s say that you’re shipping a computer. The computer arrives damaged and not working, but upon further examination, it’s determined that the video card is broken. In this situation, the carrier wouldn’t pay to replace the entire computer, but instead to replace the video card.

Shipping with Greater Peace of Mind

Although billions of packages are circling the globe each year, your chances of losing a package with UPS are rare. But when it does occur, the process is frustrating. First, the company must deal with the customer, making things right on their end. Then they must invest time in recovering what they can of the loss. It’s not an ideal situation, but by planning for a small number of packages to have this problem, processing the issues will be easier, and having the right insurance in place is key.  

Setting internal policies for handling lost packages is critical to making the process smoother. If a customer calls and says a package is lost, missing, or damaged, what will your company do? Making sure that everyone is following the same policy will streamline the process and mitigate the risk for additional customer aggravation.

Taking into account the value of the item that you’re shipping and UPS shipping insurance maximums will help make better decisions and create better policies. Additionally, when you understand the fine print of UPS insurance coverage, such as the exclusion of coins and other items, you’ll know what to expect in these situations.

Many different factors play a role when you decide to purchase shipping insurance, but by keeping all these details in mind, you can mitigate risk and ensure that your item arrives at its destination with greater security.

About Shipware

Shipware delivers volume parcel and less-than-truckload shippers intelligent and innovative distribution solutions and strategies. Whether you ship with FedEx, UPS, USPS or regional carriers, our contract negotiation and invoice audit services are guaranteed to reduce your parcel and LTL shipping costs by 10 to 30 percent, with no disruption to current operations. Our team of experts has over 200 combined years of carrier pricing experience. We have negotiated thousands of FedEx, UPS and LTL contracts – saving our clients an average of 19 percent of their annual shipping spend.


UPS Holiday Shipping Deadlines & Other Helpful Tips

By Shipware | News, Shipping Knowledge, UPS

Online shopping during the holidays is consistently growing, and this year will be no exception. During 2016, online holiday shopping accounted for $94.4 billion in revenue, and in 2017, that number grew to $108.15 billion. According to this year’s spending predictions for Black Friday, online shopping is expected to reach $5.8 billion, which is a 15.31 percent increase from 2017. Most retailers know that a spike in revenue is coming, but the key to handling increased volumes is by preparing early.  

Carriers will frantically be delivering packages under intense deadlines and with customer expectations that demand no mistakes. A late or damaged package could translate to a fumbled gift, a mistake that customers rarely forgive. What’s more, mistakes during the holiday season have a ripple effect throughout the coming months. So how can retailers prepare?

Preparation requires many steps, but one significant area that requires attention is shipping. UPS is a common carrier for holiday shipping, and by having a strong understanding of UPS deadlines and what can be managed under intense pressure, retailers can adequately set expectations with customers. Read on to learn important UPS holiday shipping deadlines and other helpful tips to kick off a holiday season that over delivers.

Important Dates for Holiday UPS Delivery

Customers eagerly await package deliveries during the holiday season, checking off items on their shopping lists as each one arrives. A late delivery could amplify negative emotions in an already stressed-out shopper. Minimize this situation by marking your calendar and planning for critical UPS shipping dates during this peak season. Check out the below dates and view the entire holiday schedule here.

Monday, Dec. 17. UPS 2nd Day Air packages picked up today are scheduled for delivery on Thursday, Dec. 20. UPS 3 Day Select packages picked up today are scheduled for delivery on Friday, Dec. 21.

Tuesday, Dec. 18. UPS 2nd Day Air packages picked up on this date are scheduled for delivery on Friday, Dec. 21. UPS 3 Day Select packages are scheduled for delivery on Monday, Dec. 24.

Thursday, Dec. 20. Mark this date on your calendar, because it’s the last day to ship UPS 2 Day Air packages for delivery on Monday, Dec. 24.

Friday, Dec. 21. This is the last day to ship UPS Next Day Air packages for delivery on Monday, Dec. 24. UPS Next Day Air service may also be available for delivery on Saturday, Dec. 22. However, these packages must be processed and labeled for Saturday delivery, which is not available in all ZIP codes.

Saturday, Dec. 22. Delivery of UPS Worldwide Express, UPS Next Day Air and UPS 2nd Day Air packages are processed and labeled for Saturday delivery.

Sunday, Dec. 23. No UPS pickup or delivery service is available. However, UPS Express Critical service is available.

Monday, Dec. 24. Pickup service is available only for Air and International Air packages if it’s pre-arranged by Thursday, Dec. 20.

Tuesday, Dec. 25. This is a UPS holiday, and no UPS pickup or delivery service is available.

If you have specific questions, you can also use the UPS Calculate Time and Cost tool, which will help to determine the best shipping dates for your package.

UPS & FedEx Peak Surcharges

Another factor to consider during the holiday season are the UPS and FedEx peak season surcharges that may apply to customer packages. One or more of these surcharges may apply during the peak period of the holiday season, and they vary based on the selected service level and characteristics of the package.

This season’s peak period is roughly from Nov. 18 to Dec. 22 for UPS and Nov 19 to Dec 24th for FedEx. It primarily impacts a limited number of packages that exceed standard size or require additional handling.

The one area FedEx and UPS differ is the Peak Residential Surcharge.

Surprising many, FedEx will not implement this surcharge for the second straight year, while UPS will not only apply the Peak Residential Surcharge once again, but will raise the rates established last year.  

There is always the question of what constitutes a residence vs a business run out of a residence.  Per UPS website:

“A Peak Surcharge will apply to each package addressed or delivered to a location that is a   home, including a business operating out of a home. The Peak Surcharge will apply in the amounts set forth in the charts below to the indicated service levels and during the specified   Peak Periods:

Residential packages with origin and destination within the 48 contiguous states, and    packages with Alaska or Hawaii origin:

*Source: UPS

Residential packages shipped from an origin within the 48 contiguous states to a destination within Alaska, Hawaii, or Puerto Rico:

*Source: UPS

Additionally, there may be peak surcharges applied to large packages. For example, a Peak Surcharge will apply to packages with length plus girth [(2 x width) + (2 x height)] combined over 130 inches. In addition, a Peak Surcharge will apply to Domestic packages with a length exceeding 96 inches. Plus, there is a surcharge applied to additional handling of packages. For example, if an items ships in a barrel, drum, pail or package that falls into this category, it may be subject to additional fees.

To find out this potential impact on a specific package, you can use the UPS Holiday Ground Impact Tool. Additionally, you want to make sure that your fulfillment process is optimized to help you avoid these charges. These surcharges are in addition to all the other applicable charges.

Tips for Intentional Packaging During the Holidays

A customer invests time selecting just the right gift during the holiday season, places an order, and eagerly awaits the package’s delivery. As expected, the package arrives on time; initially the customer is thrilled, that is, until he or she takes a closer look. The box is damaged, and as a result, the contents of the box don’t look as expected. Even if the actual product is not damaged, giving a gift with a damaged box or an otherwise altered appearance isn’t what the customer was expecting during the holiday season, and he or she will not be happy with the experience.

Packaging more strategically helps minimize the risk for damage and reduces the risk of unsatisfied customers. See below for tips to help you improve existing processes and build loyalty during and after the holidays.

Select the right container. Are you shipping in a box? If so, UPS recommends that you select one that is large and strong enough to protect the items inside, and one that allows you to surround the contents by a minimum of two inches with something that can act as a cushion, such as packaging materials.

Avoid “over-packing” boxes. Strike the right mix between including enough packaging material to keep the package contents safe and not overpacking the box, which can also lead to problems. Select boxes that are large and include enough space to add the required “cushioning material” without “overstuffing.”

Use a single box for efficiency, but pack items separately. A customer may purchase multiple items from your store, and the most cost-effective way to ship those items is together. Retailers, however, can run the risk of damage when these separate items aren’t packaged well within the box. When shipping items together, wrap those items individually and include enough cushioning material around each item within the box.

Continue to evaluate the shipping process. Even if the packaging and shipping process is working, it’s never a bad idea to have an annual review. There may be additional opportunities to reduce risk for damage and streamline existing processes.

Getting packages to customer on time is critical during the holiday season, but it’s also important for retailers to minimize risk for damage. By doing so, you create a situation in which the customer is thrilled that he or she received the package on time and that the condition is also exactly what was expected, which is a win during the holidays.

Maximize Shipping Performance During the Holiday Season

Packing items intentionally is a good start to holiday shipping, but it’s also a good idea to look for ways to improve performance. The holidays are the perfect time to build trust with customers and create lasting relationships. If you deliver on promises during the busiest time of year, customers know they can trust you in the months that follow.

Doing this successfully, however, requires that retailers create processes and procedures that provide a smooth experience. The customer experience is a moving target, and with the Amazon effect in full swing, the demands that customers place on retailers have never been higher. Use these tips for preparing during the holidays.

Start early. A competitive advantage starts with early planning. Target areas such as inventory, staffing, promotions, and forecasts for all selling channels to help put together a strategy for navigating the holidays with greater success.

Fine-tune communication strategies. Stress is high during the holidays, and the thought or reality of not receiving a package on time creates frustrated and angry customers. Review existing communication processes. Do you have expectations set about holiday shipping dates? Some retailers handle this by placing a message on various website pages, saying “order before XXX (date) to get your packages by Christmas.” This sets clear expectations about deadlines for the customers, and when they need to place orders.

Plan for the unexpected. There are no exceptions during the holidays. A snowstorm could mess up delivery schedules for all carriers, and some customers might understand, but it doesn’t get rid of the disappointment they feel. Sure, a huge snowstorm is beyond your control, but the customer will likely still have bad feelings. The best strategy is to plan for the unplannable. Weather may be out of your control, but if you build in a shipping time buffer, in most cases customers will get packages early. In a worst-case scenario, such as poor weather, this will provide a little extra time to get packages delivered.

Minimize the risk of overpromising. All carriers have different holiday deadlines, including UPS. By knowing each carrier’s deadlines, you can better plan when packages will arrive and build a little extra time into these estimates. The best strategy for delighting customers during the holidays is to have items arrive early, and in perfect condition.

Plan for after-holiday returns. Sales skyrocket during the holidays, and so do holiday returns during the January rush. Even if you delivered a perfect experience and the exact product requested, gift recipients may elect to return or exchange products. When reviewing shipping and holiday policies, also review policies for managing returns and how they relate to shipping schedules. Timely delivery is also important after the holidays during the rush of returns.

All carriers, including UPS, update shipping schedules annually. After the holidays have passed and business slows to normal levels, savvy retailers debrief and determine what went well and what didn’t. They can then make changes that are applied to the coming holiday season, and work toward making that a more seamless experience.

Delivering the Right Experience by Leveraging a Holiday Shipping Strategy

UPS will deliver roughly 750 million packages globally this holiday season. Many packages are moving through carriers at the same time, and if you want to minimize delays and potential damage, it’s critical to understand important deadlines and processes for minimizing risk.

With holiday anxiety pulsing through the minds of customers, building trust at this critical time of year is the key to unlocking future success. Meet holiday expectations and customers will have the confidence to purchase again and again in the future. Setting clear customer expectations and aligning them with shipping processes and goals will ensure that customers are delighted during the holiday season and that future revenue grows.

About Shipware

Shipware delivers volume parcel and less-than-truckload shippers intelligent and innovative distribution solutions and strategies. Whether you ship with FedEx, UPS, USPS or regional carriers, our invoice audit and negotiation services are guaranteed to reduce your parcel and LTL shipping costs by 10 to 30 percent, with no disruption of current operations. Our team of experts has more than 200 years of carrier pricing experience. We have negotiated thousands of FedEx, UPS and LTL contracts – saving our clients an average of 19 percent.


SurePost vs. SmartPost: What’s the Difference?

By Shipware | FedEx, News, Shipping Knowledge, UPS

Selecting the best shipping option is not an easy task for retailers already facing intense pressure to ship faster, cheaper, and more efficiently. Yet retailers know that striking the right balance between speed and cost is key to meeting customer expectations and driving down shipping costs.

FedEx and UPS have created solutions, including SmartPost and SurePost, respectively, to address this challenge. The shipping options work similarly, which leave many shippers asking, “What is the difference between the two?” Most of the differences are minor – yet understanding them can assist with selecting the right option and have a serious impact on your bottom line. But how do the services work, and what are the differences to consider when selecting the right one for your business?

SurePost and SmartPost: Understanding the Basics

Cost is a major consideration when sending packages. FedEx and UPS created SmartPost and SurePost to focus on the most expensive part of the journey: the last mile. The last mile isn’t literally the last mile of a journey but can encompass several city blocks or hundreds of rural miles. Either way, it’s the most expensive leg of shipping. A driver might not have many packages going to a specific area, and if so, this drives up the overall cost of shipping.

SurePost and SmartPost were designed to make this last leg of shipping more cost-effective by joining forces with a major competitor. A package is dropped with the regular carrier, such as FedEx or UPS, but once that package gets to that last mile, it’s passed off to the United States Postal Service.

The United States Postal Service visits every address on a daily basis, which provides an opportunity to streamline last mile logistics. As a result, SmartPost and SurePost partner with the USPS to complete the final mile of delivery for the majority of deliveries.

These services are fairly similar in their cost-saving model, which involves partnering with the USPS to maximize efficiency and minimize cost. There are some differences, and we’ll highlight those shortly. But first, it’s helpful to understand the general benefits of these services, which include:

  • Cost Reduction: One of the most appealing benefits of SurePost and SmartPost is that using these services lowers shipping costs. Targeting the most expensive part of the shipping journey allows retailers to drive down the total cost of shipping.
  • Saturday Delivery: Since SurePost and SmartPost both use the USPS for the last leg of delivery, customers benefit from Saturday delivery.
  • No Residential Surcharge: UPS and FedEx charge a residential surcharge for regular delivery services; however, this surcharge is waived for SurePost and SmartPost deliveries. Since large UPS or FedEx trucks aren’t used to complete the final mile of shipping, there is no need to assess this fee.
  • Delivery to P.O. Boxes: FedEx and UPS do not typically deliver to P.O. boxes, but when partnering with the USPS, retailers can deliver to these addresses. Some recipients prefer to receive shipments at P.O. boxes, and partnering with the USPS provides additional flexibility for customers.
  • Drop-off is Easy: No special drop-off is required when using SurePost or SmartPost. Instead, retailers can simply mix these packages in with their normal shipments without the need for a special trip to the post office.
  • Tracking is Still Available: Having the ability to track packages is key to the customer experience. Most recipients want to know where their package is in the shipping process at all times. SurePost and SmartPost allow tracking throughout the entire delivery process. However, some users note that with UPS, there is a brief period of time when the package is marked as “delivered” during the transfer from UPS to USPS. The status is updated once the package is in the system, and the shipping process continues.

The largest drawback to using SurePost and SmartPost is slower delivery times. A slow delivery time, however, may be acceptable if customers expect it upfront. This is especially true in cases of free shipping. When considering these services, it’s also important to consider the differences.

Drop Locations Vary From SurePost to SmartPost

Retailers have a large opportunity to save by using SurePost and SmartPost and targeting that last mile of delivery. In fact, the last leg of delivery accounts for up to 28 percent of a shipment’s total cost, so allowing USPS to handle it offers decent savings. UPS and FedEx, however, handle the handoff from carrier to USPS slightly differently.

UPS SurePost packages are dropped at the USPS location closest to the package’s final destination. In most cases, this is the recipient’s local post office. As a result, the package is fairly close to its final destination, which may save time in the shipping process.

In contrast, FedEx SmartPost delivers the package to the nearest USPS regional hub, which is not the local post office. For example, the regional hub might be in a major city and the recipient’s address might be in a suburb 30 miles away. The reason why FedEx uses this strategy is that it creates efficiencies for package processing, yet some speculate that it may impact delivery times. Delivery times will be discussed in more detail shortly, but this is one key difference to note.

Determining the Last Mile of Delivery

UPS and FedEx use a similar strategy to drive down costs by targeting the last mile of delivery, but with UPS, the carrier does not always use USPS for that final leg of delivery. Why?

UPS workers are in the Teamsters union, so concerns were present that “outsourcing” a portion of the delivery process may jeopardize job security. As a result, UPS handles the handoff slightly differently by using sophisticated software. This software determines whether it’s truly more efficient for UPS or USPS to complete the final leg of delivery for each individual package and schedules it accordingly. And in some cases, it’s more efficient for UPS to handle the last mile of delivery.

For example, a UPS driver might already be visiting the delivery area and have multiple packages to deliver. If so, package delivery by UPS is still efficient. In contrast, FedEx uses a more general approach for that last leg of delivery. As a result, up to 60 percent of UPS SurePost deliveries are still delivered by UPS – not USPS.

Using UPS might be more likely to keep the package with the carrier and less likely it will arrive at the destination via USPS. Whether this affects delivery speed is speculative, but it’s one key difference to consider when evaluating options. But what about delivery times? How long does a package spend in transit with each of these services? Here is a quick comparison of SurePost and SmartPost.

  • FedEx SmartPost. According to FedEx, delivery time is typically two to seven business days based on the distance to the destination. There is a longer transit time outside the contiguous 48 states. Service days are Monday through Saturday, and the delivery area includes 100 percent U.S. coverage, including service to Alaska and Hawaii; Puerto Rico; Guam; U.S. Virgin Islands; all U.S. territories; P.O. boxes; and military APO, FPO and DPO destinations.
  • UPS SurePost: Delivery time isn’t published on the company’s website, but users report it’s typically around one day slower than using UPS ground. This is because on the day UPS typically would drop the package at the customer’s door, it’s dropping it off at the nearest USPS location instead.

Shipping Fees – How They Are Charged

It’s estimated that the savings using SurePost and SmartPost are significant – as much as 20 percent when compared to using standard FedEx or UPS. And while savings are significant with each, let’s take a look at some of the potential savings and fees for each service.

  • SurePost and SmartPost do not charge a residential surcharge: When shipping packages to a residential address, there is typically a surcharge for delivery, which increases the total cost to ship a package. Neither company charges this fee for these services.
  • UPS charges about 3 percent more: UPS charges about 3 percent more for SurePost compared to standard UPS; however, still no residential surcharge is charged. When looking at the potential for slightly faster speed, this additional cost might not be a serious consideration, especially since the overall cost of shipping is lower than UPS’ standard services.

When evaluating these services, it’s also helpful to consider the exact details of what you’re shipping, such as weight and dimensions. Understanding the rules and requirements for SurePost and SmartPost is a good starting point for figuring out which one is best for a specific package.

Dimension Differences and Considerations

SurePost and SmartPost have rules about package dimensions that may influence your ability to use these services. How much does your package weigh? Are the dimensions too large? Here is a quick comparison to consider for each carrier.

FedEx SmartPost:

This service can accept a package weight of up to 70 pounds and a size of 130 inches in length plus girth. In addition, it’s important to note a few FedEx special features that are not available, including:

  • Collect on delivery
  • Money-back guarantee
  • Declared value
  • Signature proof of delivery
  • Evening or by-appointment delivery
  • Hazardous materials service

In addition, FedEx SmartPost won’t pick up packages that originate outside the contiguous United States.

UPS SurePost:

A few different UPS SurePost services are available, including:

  • SurePost Less than 1 pound, with a maximum weight of 450.76 grams
  • SurePost 1 pound or more, with a maximum weight of 70 pounds
  • SurePost Bound printed matter, with a maximum weight of 15 pounds
  • SurePost Media, with a maximum weight of 70 pounds

The total dimensions of the package cannot exceed 130 inches and must be less than 1 pound if you select SurePost; it can be 1 pound or heavier and up to 108 inches in size if you select SurePost Bound Printed Matter or SurePost Media in the UPS service box.

Moving Forward to Maximize Cost Savings and Efficiency

Selecting the right shipping option isn’t always an easy choice, especially when attempting to balance cost with speed. SurePost and SmartPost provide good alternatives to help retailers operate with greater efficiency. Package delivery may be slower when compared to traditional options, but if you communicate that clearly to customers, it might not be an issue.

Striking the right balance between efficiency, cost savings, and customer needs and expectations is the key to minimizing costs and maximizing savings. As a result, a unique synergy is achieved – one that has the potential to impact your bottom line and contribute to the future success of your company.

About Shipware

Shipware delivers volume parcel and less-than-truckload shippers intelligent and innovative distribution solutions and strategies. Whether you ship with FedEx, UPS, USPS or regional carriers, our contract audit and negotiation services are guaranteed to reduce your parcel and LTL shipping costs by 10 to 30 percent, with no disruption of current operations. Our team of experts has over 200 years of carrier pricing experience. We have negotiated thousands of FedEx, UPS and LTL contracts and saved our clients an average of 19 percent.


How Does UPS SurePost Work?

By Shipware | News, Shipping Knowledge, UPS

Shipping is an important piece of the puzzle for most companies. But it’s not just about shipping quickly enough to make customers happy or shipping efficiently enough to realize productivity gains — it’s also about achieving lower costs without compromising the outcome.

Saving 10 percent on shipping costs might not seem like a large gain, but when you apply this to a company with high costs, the bottom line can see significant improvements. When this number is raised even higher to 20 percent, those gains quickly multiply.

When breaking down shipping, the final leg, known as the “last mile” regardless of actual distance, is where costs accumulate. That last mile might be a few blocks or 100 miles, but regardless, it’s where a large portion of your shipping dollars are going. As a result, reducing shipping bills and realizing sustainable cost savings start with this single factor.  

A key strategy for driving down costs is using a well-known shipping service that is already achieving success but has created a method specifically for targeting these last mile delivery costs. Driving that big, heavy UPS truck to your shipping destination is expensive. This is especially true when dealing with rural deliveries. As a result, UPS found a way to make that final leg of delivery less expensive, passing those savings along.

That service is called UPS SurePost (similar to FedEx SmartPost), and it’s a good solution for many businesses looking to reduce shipping costs and preserve the quality of delivery. But what exactly is UPS SurePost and how does it work?

Diagram of UPS SurePost

What is UPS SurePost?

Before services like UPS SurePost, shippers were at a loss for what to do when faced with expensive last mile delivery costs coupled with negative feedback from customers about the high cost of shipping.  One of the drivers behind these complaints was the high cost associated with an increasingly popular free-shipping option. In fact, nine in 10 consumers say free shipping is the No. 1 incentive when making a purchase, according to Marketing Land.

As a result, UPS created an option that would focus on driving down the costs of the last mile so it could pass that savings along to customers. The existing model included using its own resources — big trucks, fully staffed shifts, and running many deliveries a day, sometimes to rural and expensive delivery areas. In contrast, the last mile needed to be more efficient, so the company had to think differently and utilize resources that were already in place.

The United States Postal Service has a long history of delivering packages in the United States, and what’s more, it delivers to most addresses in the United States on a daily basis. Since the USPS is visiting everywhere daily, what would happen if UPS teamed up with the postal service for the last mile of delivery, saving its trucks from duplicating delivery efforts? This is the basic strategy behind UPS SurePost, and it’s how it saves shippers money.

However, there are some differences between the traditional service and that of UPS SurePost. For example, with traditional UPS service, a package may require a signature. In this case, the UPS driver cannot leave the package and must instead revisit the address until a signature is obtained. With SurePost, this option is not available, and packages are delivered to the address on the first attempt, which is outlined in the terms and conditions.

When considering this option, you might also wonder about limitations and how large packages can be to achieve these savings. The options for delivery are outlined here, but a quick summary includes the following.

  • SurePost less than 1 lb: 1 ounce – 15.9 ounces. Package dimensions cannot exceed 130″ (length × twice width × twice height).
  • SurePost 1 lb. or greater: 1 lb. – 70 lbs. Package dimensions cannot exceed 130″.
  • SurePost Bound Printed Matter: 0.05 kg – 15 lbs. Restricted to books and printed material. Requires a SurePost Bound Printed Matter contract in addition to a SurePost contract.
  • SurePost Media: 0.45 kg – 70 lbs. Restricted to specific items such as binders, films and medical binders. Requires a SurePost Media contract in addition to a SurePost contract.

Once you decide that using SurePost is a good fit, you might have other questions, including some about the potential savings. Exactly how much can you save? Let’s take a closer look into the costs of SurePost to understand the potential savings and whether it’s right for your situation.

How much does SurePost save?

Shipping is a major expense for businesses, and SurePost promises to save you money. Every little bit helps when trimming costs, but is SurePost worth making a switch? It’s estimated that the savings from using UPS SurePost can be as high as 20 percent when compared with UPS’ own residential ground service. And if you’re using a more expensive option than UPS, these savings might be even higher.

In addition, you get further benefits, which we’ll highlight shortly. For example, since the postal service already operates on Saturdays, goods can be delivered on the weekend. Shipping packages to P.O. boxes and military addresses is also possible, a flexibility many other shippers, including traditional UPS service, don’t allow for. These benefits, in combination with cost savings, make SurePost a viable option for those looking to reduce cost and increase flexibility. But there are also drawbacks, and we’ll also cover those shortly.

Understanding the Pros & Cons of SurePost

How would saving 20 percent on shipping costs affect your bottom line? The answer is likely positively. But cost savings aren’t the only benefit of using this option. There are several more potential benefits to consider, including the following:

  • Normal pickup options are available: Using SurePost does not require special treatment for drop-off or pickup. Trips to the post office are not required, and shipments can even be mixed with your typical UPS pickup.
  • Packages are still trackable with SurePost tracking, even during the last mile: One key feature of UPS is the ability to track packages. You don’t lose this ability when using SurePost. That last leg of delivery with USPS is still trackable with the same tracking number you received when initiating shipping.
  • Integration with shipping software is possible: Software is key when managing large numbers of shipments, and integration is important. SurePost integrates with most software, which is critical if you already have a software program in use.
  • The most expensive part of shipping is managed: As highlighted above, the last mile of shipping is the most expensive piece of the cost. This single factor makes up 28 percent of a shipment’s total costs — nearly a third. SurePost directly tackles this high cost and creates a more cost-efficient option for those who ship large volumes of packages.
  • Access to Saturday delivery is available: The SurePost model dictates that most packages are passed on to USPS for the final leg of delivery. No extra charge is assessed for delivering packages on the weekend — it’s included in the service. This is an important factor because one drawback to SurePost is that it’s slower than traditional UPS service (more on this in a minute). Weekend delivery helps offset this drawback.
  • The ability to ship to more addresses is possible: UPS normally will not deliver to P.O. boxes. Depending on your business, this may or may not be a sticking point. But it’s important to note that since USPS delivers to all addresses, through this hybrid UPS and USPS model, you have the flexibility to reach many places geographically that UPS would not normally go.
  • Packages are primarily lightweight (less than 10lbs) and being delivered to residential addresses.

Members can also use “UPS My Choice” membership, which allows them to use features to reschedule or redirect delivery to an alternative address or The UPS Store. Additionally, upgraded packages may arrive one day earlier.

With all the benefits of SurePost, it’s also important to note there are a few drawbacks. As mentioned previously, SurePost might take a little longer. Making the last mile more efficient does slow down the delivery process slightly. UPS drivers must pass the packages off to USPS, which then must sort them and ensure they get to the correct addresses. Is it cost effective? Yes. But is it slower? Absolutely. But how much slower?

UPS states that packages mailed via SurePost may take anywhere from two to seven days until arrival. Some users report an average delay of about three days when compared with using UPS’ typical service.

The major source of the delay is the transfer of packages from one carrier to the other, but this is also the source of savings. Before using SurePost, it’s important to consider the benefits and the drawbacks to determine what is right for your business. In some cases, when shippers are under intense pressure to offer free shipping, it’s worth the delay as long as customers have clear expectations about shipping times upfront.

Who Should Use SurePost?

SurePost is not right for every shipping situation, but when it’s a good fit, the result of using it can be significant. For example, if you’re worried about rising shipping costs and want to get those costs down and your profits up, this might be a good option. When making the decision about whether this service is right for you, it helps to understand who might benefit most.

  • A large number of packages are shipped weekly: SurePost might not be right for those who ship occasionally, but if you ship a large quantity of packages frequently, it may be a good fit.
  • The last-mile delivery costs are high: Since last-mile delivery makes up so much of the shipping cost, SurePost may be a good option to decrease these costs.
  • Expedited delivery is not required: SurePost is not the right option if you need something to arrive at a destination fast. SurePost does have the added benefit of Saturday delivery, but if recipients expect fast shipping, this is not the right option.
  • Weekly spend with UPS is required to drive down costs: UPS determines negotiated rates based on average weekly spend. Increasing your spending and consolidating shipping from other carriers to SurePost can boost that weekly spend. As a result, you may benefit from lower fees based on increasing this spend.

The best approach is to look at your current shipping costs. Ask this question: Do these shipments need to arrive quickly? If the answer is no, then you may benefit from another option, and in the case of reducing last-mile costs, SurePost is a viable solution.

Moving Into the Future With Greater Efficiency

UPS SurePost Shipping offers a good balance of a low price and a reasonable delivery speed. The UPS SurePost delivery time is slower than UPS ground service, but is sensible for the price. It also offers significant savings over typical ground shipping options by offloading shipping to a large delivery area to USPS, which is already visiting many of the locations and can handle Saturday delivery.

When looking at the market, there is no shortage of shipping options. But the key is to find a match between the customer’s expectations and the most cost-effective method for delivery. Once you find this match and utilize creative options to slash that last-mile cost, you can create maximum efficiencies within your business.

About Shipware

Shipware delivers volume parcel and less-than-truckload shippers intelligent and innovative distribution solutions and strategies. Whether you ship with FedEx, UPS, USPS or regional carriers, our contract audit and negotiation services are guaranteed to reduce your parcel and LTL shipping costs by 10 to 30 percent, with no disruption of current operations. Our team of experts has over 200 years of carrier pricing experience. We have negotiated thousands of FedEx, UPS and LTL contracts and saved our clients an average of 19 percent.