Insights

Peaking At the Wrong Time

As businesses around the country gear up for a Holiday Season that seems to come earlier and earlier every year, carriers are also preparing for the busy times ahead. Both UPS and FedEx have announced their Peak Season Surcharges for the upcoming festive period, and as usual, they’re a doozy. While annual GRI’s and Peak Season Surcharges have become the standard operating procedure of the two national carriers, this year, they could not come at a worse time.

Transportation capacity is still backed up nationwide, as companies struggle to offload excess inventories just as consumer demand dips due to rising inflation. Add to that the continued high cost of fuel across the globe, and these seasonal rate hikes are primed to hit many businesses’ bottom lines hard.

Some highlights from the recent announcements:

  • High volume shippers are going to be affected the most
  • Surcharges for Additional Handling and Large Packages will double during this period
  • International shipping rates will increase across the board

But don’t worry, all is not lost. We here at Zero Down pride ourselves on offering solutions, not just identifying problems (it’s even in our name). So, with that in mind, here are three things you and your team can do right now to help mitigate these rate hikes and ensure a successful season:

Implement a Parcel Audit:

Any time there are changes made to the carrier’s pricing schemes, there’s a higher likelihood that errors will get made along the way. With the increased madness surrounding the Holiday Season, making sure your business has an accurate and comprehensive parcel audit in place beforehand is absolutely critical to finding and eliminating rate errors during the next few months.

Diversify Your Carrier Portfolio:

One easy way to avoid unfavorable carrier rates during Peak Season is to simply use a different carrier. And, while the idea of integrating and using multiple carriers may seem daunting to some shippers, modern Transportation Management Systems make it easy to get quotes, print documents, and track shipments from numerous carriers at the same time, all from one easy to access web portal.

Optimize Your Distribution Network:

With warehousing and transportation capacity still tightly constrained across the country, knowing exactly where your demand regions are located is even more critical heading into the Holiday Season. A detailed and sophisticated network analysis can allow your company to optimize inventory storage, and thus save big on distribution costs just when you need it the most.

The speed of the modern business world continues to take some leaders by surprise. Especially in this Post-Pandemic era, prices and services continually fluctuate, making it seem almost impossible to stay ahead of the commerce curve, or even to keep up at all. But having the right systems in place and utilizing the latest technology, companies can not only survive these rate hikes and logistics bottlenecks, but go on to thrive. Peak Season Surcharges don’t have to be the death of your supply chain, as long as your supply chain is ready to Peak as well.

If you would like to learn more about setting your company up for success this Holiday Season, reach out to us today.

You Can Be Better. We Can Help.

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Author: Brad McBride

Brad McBride, CEO and Founder of Zero Down Supply Chain Solutions is a dynamic leader with over 30 years of experience in the supply chain sector. His journey began at Consolidated Freightways in 1988, where he mastered freight logistics and pricing. His career led him to Eagle Global Logistics, diving into international freight forwarding and leading high-volume shipping projects.

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