UPS has announced a general rate increase that will take effect on December 26, 2023.

With an average rate hike of 5.9% for UPS Ground, Air, and International services, and most common surcharges rising higher than the announced GRI, eCommerce merchants are now navigating a more challenging business environment.

Let’s look at the specifics of these rate changes and discuss practical strategies to help mitigate the impact on your business.

What You Can Do To Mitigate the Impact

Negotiate Better Contract Terms 

Dive deep into the fine print of your UPS contract. Decode those complex clauses and pinpoint where a little negotiation could unlock big savings for your business. With the right insights, your next contract could transform your shipping costs from a cost center into a profit driver. This proactive approach not only mitigates the impact of rate increases but also paves the way for a more sustainable, cost-effective shipping strategy that supports your long-term business growth.

Optimize Your Shipping Strategy

Make undercharging or overcharging for shipping a thing of the past with Dimensional Packing. Automatically determine the best packing configuration for any combination of products in a cart, and combine with custom packing rules, to ensure you’re getting the most accurate rates. No more guesswork or manual calculations—just a more efficient pick and packing process and a healthier bottom line.

Protect your margins and sales with correct charges for residential and commercial shipments. Our advanced Address Validation feature automatically validates the addresses entered by customers at checkout, identifies whether the shipping address is residential or commercial, and passes that information along to the carrier to ensure that the shipping rate for each order is always 100% accurate. This not only minimizes the risk of address correction surcharges but also provides a seamless shipping experience for your customers.

Leverage Profitable Returns Solutions

Processing a return can cost retailers up to 66% of an original item’s price.

Rethinking how you handle returns and the associated costs is crucial in light of the UPS rate hike. One solution is to offer customers the option to pay a fixed return surcharge at checkout.

Our new Returns Options capability enables you to conditionally provide this option based on carriers, shipping methods, and customer groups. Plus, you have the flexibility to customize the text and amount charged to align with your specific requirements. For instance, you can display a liftgate fee or gift wrap upcharge alongside standard shipping rates.

By offering return shipping at checkout, you can effectively navigate the challenge of offering customer-friendly returns without compromising revenue and profit margins.

ShipperHQ is here to support you on this journey.

Now is the time to adopt and innovate. Sign up for a free 15-day trial today to get the advanced shipping tools and expert guidance you need to optimize your shipping strategy and maintain your competitive edge.