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What You Need to Know About Zonal Pricing Impacts

On April 11th, UPS changed to new Large Package and Additional Handling Zonal Pricing. How does this affect you?

Additional Handling Charges

Additional Handling Charges are added to packages requiring special handling. This includes packages above certain weight or dimension thresholds, or shipped in non-standard packaging.

2021 Zonal Increases

Domestic Zone 2 Zones 3-4 Zones 5+
Weight $24.00 $25.50 $27.00
Length + Girth $15.00 $16.00 $18.00
Length $15.00 $16.00 $18.00
Width $15.00 $16.00 $18.00
Packaging $14.00 $15.00 $16.00
International $16.00

Source: 2021 UPS Rate & Service Guide

Large Package Surcharges

Large Packages have a length + girth exceeding 130″. For domestic shipments, a Large Package is also one exceeding 96″ in length.

2021 Zonal Increases

Domestic Zone 2 Zones 3-4 Zones 5+
Length + Girth >130″ $100.00 $105.00 $120.00
Length >96″ $100.00 $105.00 $120.00
Length + Girth >130″ $125.00 $130.00 $145.00
Length >96″ $125.00 $130.00 $145.00
International $105.00

Source: 2021 UPS Rate & Service Guide

Why are my LPS Costs out of control?

Large Package Surcharge increase graph

Are My ACH Costs any better?

Large Package Surcharge AHC Dimension graph

Analysis and Recommendations

  • Most shippers will see a 5%-10% increase into ACH and LPS accessorial charges due to new Zonal Pricing.

  • Those with fewer DC’s will be impacted at a higher rate than those with saturated DC’s with a balanced inventory.

  • Expect UPS & FedEx to continue to charge COVID surcharges until the pandemic is undeniably over.

  • If you are a FedEx Shipper, expect to see New Zonal pricing by the 2021 GRI, if not sooner.

  • UPS & FedEx continue to target LPS & ACH packages, claiming the need for margin improvement.

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That ally can be found in an organization that has dynamic analytics, logistics expertise, and parcel pricing experts!

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