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UPS Rates Increase 5.9% During Peak Holiday Season
Oct 12, 2024
UPS Rate Increase December 23rd by 5.9%. Just in time for holiday peak season.
UPS has announced that its 2025 rate increase will take effect on December 23, 2024, just in time for the holiday season. The General Rate Increase (GRI) will average 5.9%, marking a significant adjustment for shippers.
Among the most impactful changes are the updates to the Large Package Surcharge (LPS) and the Additional Handling Charge (AHC):
- Effective January 27, 2025:
- The Large Package Surcharge (LPS) will now be calculated based on revised criteria, factoring in the length, weight, or cubic volume of shipments, whichever results in the higher surcharge.
- The Additional Handling Charge (AHC) will shift from the traditional length plus girth measurement to a cubic volume calculation. However, other existing factors determining AHC will remain unchanged.
This is the first time in recent memory that UPS has implemented a rate increase before Christmas, which means businesses will feel the effects earlier than usual. The changes will likely lead to higher shipping costs for customers while boosting UPS's revenue.
If you're concerned about how these changes will impact your shipping expenses, Mindful Logistics can help.
Contact us for a free analysis to understand how these rate increases will affect your business and how you can mitigate these costs before the new rates take effect in just over 60 days.
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UPS Ground vs FedEx Ground There are a lot of similarities between FedEx and UPS package operation systems. However, there are also quite a few differences between the two giant package delivery companies. UPS uses one truck to make their deliveries and pick-ups for companies. That means they deliver and pick-up all the ground, air, and international packages in one package truck. FedEx on the other hand has 3 different trucks. They have their Express, Ground and Home Delivery trucks to service their customers. Home Delivery Trucks are used to service ground residential packages. Ground Deliveries for both companies can take over 7 days to deliver depending on your origin and where the destination delivery address is located. Both UPS and FedEx offer Ground Shipping Options to Hawaii, Alaska, and Puerto Rico from the contiguous US as well as into Canada. Urban Areas FedEx has prioritized urban areas for their deliveries. UPS also prefers urban areas where they can off load more packages and drive less miles. These urban deliveries provide the both companies with a higher profit margin on their packages. UPS operational centers service roughly a 60-mile radius from each building. FedEx does not have as many operational centers in the US as UPS requiring their drivers to travel further to service rural routes. UPS has more trucks going to rural areas than their competitor, thus doing a better job at servicing the rural areas. Is UPS or FedEx Faster? Who will deliver your ground package faster? That will depend largely on your origin zip code. If you visit www.fedex.com and www.ups.com you can search your zip code to see who has the competitive edge to servicing your customer base. The maps are in color and will show you how many days in transit it will take to deliver packages from your location around the US. From our analysis, FedEx is quicker to deliver to more areas throughout the country than their counterpart. From zip code 28405, FedEx is the faster delivery to the Northeast, Illinois, and some parts of the west coast. However, UPS was quicker to deliver to Arizona than FedEx. Your Preference At the end of the day, it is your preference on which carrier you choose to use to deliver your packages. If time in transit is a key metric for your company, comparing your customer base location in the ground transit maps offered by each carrier will allow you to choose the carrier that will help get your packages faster to your customers. Mindful Logistics utilizes our expert knowledge of the industry to offer consultation to find the perfect shipping fit for your business. Click here for a free rate analysis.
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