Written By: Celine Clayton
2020 has been a year filled with change and adaptation from the impact of Covid-19. One of the largest industries that have drastically seen an impact is retail. With the digital shift, there has been a dramatic increase in eCommerce. In April and May alone, delivery demand was 7% higher than 2019's holiday peak shopping season of November and December. Experts believe this holiday shopping season will present historic, unprecedented numbers with the rapid increase in demand.
To combat overwhelming demands, traditional courier companies have announced new peak charges scheduled to begin mid fall. FedEx, UPS, and USPS each plan to implement surcharges. Salesforce projects the additional fees, and related surcharges are projected to reach $4.5 Billion by the end of this year.
Here's what you need to know:
UPS plans to implement surcharges for those who surpass 25,000 parcels a week. The surcharge amount is based upon the average weekly delivery amount shipped pre-COVID. Those who exceed 110% average capacity will incur a surcharge price per package (seen below in graphic). UPS's peak surcharges are stated to run from November 15th to January 16th.
FedEx plans to add peak surcharge costs after a three-year absence. Their Covid-19 surcharge is stated to be in place until November 1st, with their holiday surcharges taking place on November 2nd. Surcharges on residential shipments will range from $1-5, slated to end January 17th. The surcharges will be based on the amount shipped between Oct.5 - 17th, applying to those who ship over 35,000 packages weekly.
USPS has announced added surcharges beginning October 17th to December 27th. Their temporary surcharges will range from $0.24 to $1.50 per package and are stated to affect commercial consumers in line with competitive practices. These surcharges will not impact customers at the personal, store level. They are being implemented as a hopeful way to keep the Postal Service competitive while providing the agency with much-needed revenue.
With no sign of shipping demands slowly, OneRail launched this week Capacity as a Service, powered by OneRail. Capacity as a Service "CaaS" provides retailers with immediate access to a network of 4.5 million drivers and 20 local and regional couriers across the nation. This access to local and regional couriers will offer faster transit times and expanded service levels, such as same-day shipping, next day shipping, online and pick up in-store, and three-day delivery. Traditional Parcel and LTL have been shifting into local and regional courier deliveries due to cost, and SLA misses. No surcharges, no increased prices, and heightened capacity enable an affordable option for shippers.
Besides the connection to the network of Couriers, CaaS provides exclusive access to the OneRail Platform enabling full visibility of all deliveries, real-time status updates, proof of delivery, AI smart matching to couriers based on the job, Live-USA based support team, and analytics across the full journey.
To learn more about Capacity as a Service, contact us today!