UPS Announces Increased Charges for Oversized Packages

$150 Extra to Handle Oversized Packages

As reported by Reuters, the new fees add to charges UPS announced last year for oversized items and come as the world’s largest package delivery company is investing billions of dollars to expand and automate its U.S. sorting facilities.

UPS and rival FedEx Corp currently deliver parcels up to 150 pounds (68 kg) to a person’s doorstep.

The new charges are aimed at discouraging retailers from shipping heavier products that can bog down parcel sorting facilities, the company said.

UPS spokesman Glenn Zaccara said, “It’s not a revenue-generating charge, its something we have increased regularly over time to encourage customers to ship through the UPS Freight network for these over max items.”

From June 4, UPS is hiking per-package surcharges for pallets and packages heavier than 150 pounds from $500 to $650, a $150 increase, according to a May 11 message on its website.

UPS is adding a new $1-per-package fee if retailers mislabel a package's dimensions.

UPS Rate Changes

May 11, 2018 Update/Over Maximum Limits, Oversize Pallet Handling Surcharge and Shipping Charge Corrections

Effective June 4, 2018, the fee for Over Maximum Limits and the Oversize Pallet Handling Surcharge will increase by $150 and a new Shipping Charge Correction Audit Fee will be added. The Audit Fee will be assessed if the average shipping charge correction in an invoice week is more than $5.00.

The Audit Fee will be the greater of $1.00 per package subject to a shipping charge correction or 6% of the total amount of shipping charge corrections during the applicable invoicing period. Review the applicable UPS Rate and Service Guide starting on June 4, 2018, for further detail.

The Rise of Ecommerce

“They are making it clear to customers that they don’t want this oversized volume, and if you are going to ship it with UPS they are going to charge you an arm and a leg,’” said John Haber, CEO of Spend Management Experts, a supply chain consultancy.

“The sort facilities and conveyor systems are not equipped to handle packages that weigh 200 pounds. With the growth of e-commerce, retailers are shipping whatever they can and it’s very hard for UPS to manage that.”

The rise of e-commerce has forced UPS and FedEx to grapple with increased volumes of massive goods like sofas and televisions that consumers are increasingly buying online.

“With the rapid growth of e-commerce, retailers are shipping whatever they can and it’s very hard for UPS to manage that”John Haber, CEO of Spend Management Experts

FreightWaves also reported that the continued expansion of e-commerce has exacerbated the over maximum problem for parcel carriers, as large items such as appliances, televisions, and furniture can increasingly be purchased online and delivered to either a retail location or a residential address.

With large retailers such as Walmart and Amazon often offering items of all sizes through the same interface, parcel carriers can be faced with the challenge of having to deal with these over max packages.

UPS reportedly is in talks with a least one trucking company to form a partnership to create an in-home delivery service for these heavy residential deliveries.

In doing so, UPS hopes to take advantage of the rise in e-commerce sales of larger items and alleviate some of the complications that come with dealing with packages that exceed the weight limit.

In addition, UPS announced that it would be assessing an audit fee to shippers who fail to accurately label package dimensions. Mislabeled dimensions result in an improper calculation of the rate for packages, and often lead to lower charges to shippers.

UPS discovers these dimensional errors as packages are weighed and measured throughout its network. The audit fee will be $1 per package or 6% of the total shipping cost and will be charged to all shippers that average more than $5 in shipping change correction per package in a given week.

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