As if the promotional products industry isn’t facing enough shipping challenges, now the two biggest carriers in the United States are jacking up their peak surcharges.
UPS has increased surcharges on international shipments from multiple locations in Asia to the U.S. In Hong Kong and China, service levels such as UPS Worldwide Express and UPS Worldwide Saver have leapt to $1.36 per pound, up 11 cents from earlier this month. In Taiwan, those same service levels have jumped 12 cents to $0.57 per pound.
FedEx has also announced increased fees on a variety of services, all with effective dates of June 21, 2021, until further notice. A peak surcharge of $3.50 per package (up 50 cents from the surcharge implemented in January) has been added to U.S. Express Package Services, U.S. Ground Services and International Ground Services. FedEx Ground Economy Package Services’ peak surcharge increased 25 cents to $1 and the Peak - Residential Delivery Charge for FedEx Express and FedEx Ground domestic has doubled to 60 cents.
“FedEx has kept commerce moving and delivered critical shipments throughout the COVID-19 pandemic,” the company said on its website. “The impact of the virus continues to generate elevated volumes, high demand for capacity and increased operating costs across our network. To provide our customers with the best possible service during this challenging time, the … surcharge increases are being implemented.”
The promo industry may be most impacted by the surcharge on residential shipping, which would increase the price of drop-shipping products to end-users. Since the COVID-19 pandemic began emptying offices and drying up event business, companies have relied on sending work-from-home kits, virtual event mementos and other gifts directly to their customers’ front doors. Nearly one-third of distributors provided kitting last year, research from ASI shows.
UPS and FedEx’s increased surcharges are another hurdle for industry firms contending with escalating shipping costs, lack of containers, rising raw material prices, depleted inventory, extended delays and a labor shortage. One supplier has called it the worst supply chain disruption he’s seen in nearly 30 years.