UPS (UPS) wants retailers and their customers to pony up more money for their holiday season packages.
The delivery company on Monday announced a new 27 cent surcharge on all U.S. ground shipments to homes between Nov. 19 and Dec. 2, a period that includes the major Black Friday and Cyber Monday shopping occasions, and again from December 17-23 when business picks up again as procrastinators try to wrap up their Christmas shopping with a flurry of online shopping.
During that last week rush, UPS will also charge an 81-cent fee for next day air delivery, and 97 cents for two- or three-day ground delivery. (Those surcharges won’t be applied in the Nov. 19-Dec 2 rush.)
The move comes as UPS tries to manage the huge surge in delivery volume during the holiday season, called “peak” in shipping industry parlance and avoid having its system overwhelmed, all the more important given the chaos that a snowstorm at that time of year can cause.
UPS’s daily volume is about 30 million deliveries around Christmas time, compared to 19 million at other times, according to the Wall Street Journal. This year, eMarketer projects U.S. retail e-commerce sales will rise another 15.8% on top of 7.8% last holiday season.
This extra charge comes at a time retailers are trying to get customers to pick up more of their online orders in store. That helps retailers’ already pressured margins but also gives them a chance to pick up more business from shoppers going to a store, not to mention better compete with Amazon.com (AMZN) on speed. Kohl’s estimated that one-third of online orders were picked up in stores last holiday season.
