Delivery Area Surcharges updates from UPS

On April 8th of this year, UPS will expand their Delivery Surcharge delivery zone by 82 new zip codes. On June 17th, UPS stated that the applicable zone would change for certain origin/destination ZIP code pairs.

Ensure you understand how these 3 different Delivery Area Surcharges (DAS) can impact your cost. These charges usually apply to the delivery location unless the item is being returned.

What is a Delivery Area Surcharge and why does it matter?

A delivery area surcharge is an extra fee charged by shipping carriers for delivering packages to specific locations considered remote or hard to reach. These areas usually include rural regions, islands, or places with limited transportation infrastructure.

The expansion of ZIP codes is a regular addition yearly by carriers. The carriers use these expansions to maintain their margins, although they will contend that it is to cover their cost. You need to account for these surcharges when determining your shipping costs to ensure pricing is accurate and avoid unforeseen expenses. To mitigate the impact of these surcharges, you need to understand what percentage of your packages are being charged these fees and then negotiate a reduction.

Since most companies cannot change the destination of their shipments, the UPS agreement is the first place to reduce UPS delivery area surcharges. In particular, ask your UPS representative for a discount on DAS. A 25-50% discount on the published rate is an excellent goal. Before you ask for this concession, ensure you see many of these charges. What percentage of your packages are being charged one of these fees?

You can not alter the destination of shipments to your customers, but you can engage experts to assist you in determining what is best for your business. This is an excellent time to engage our consultants to use our advanced analytics to guide you in controlling costs and get the best-in-class agreement regardless of who you ship with.