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SOMETIMES IT TAKES A WHACK TO THE WALLET to change customer behavior. Several UPS Inc. policies that went into effect June 4 appear designed to do just that.

The Atlanta-based transport and logistics giant has imposed a fee for auditing bills that result in shipping charge corrections because the shipment’s dimensions conflicted with those calculated by the shipper. Those shipments would be subject to higher prices based on their dimensions instead of their actual weight.

Fees are assessed if the value of corrections in an invoice week exceeds $5, UPS said. The fee will be the higher of either $1 for each package subject to a shipping charge correction, or 6 percent of the total amount of shipping charge corrections during an applicable invoicing period, UPS said.

It will waive the fee if an audit finds the company’s calculations match the shipper’s.

In addition, UPS has raised surcharges by more than 40 percent on the handling of packages that exceed the company’s maximum dimensional requirements. It also raised surcharges for handling oversized pallets by 40 percent. In both instances, the surcharges jumped to $650 from $500, UPS said.

The surcharge program, known inside the company as
“Overmax,” has been in place since 2000. The surcharge
amount has been raised through the years to account for
the increase in outsized shipments moving through UPS’s
small-package network due to elevated e-commerce activi-
ty. To keep such merchandise out of its network, UPS, the
nation’s largest transportation company, has reportedly
been looking to team up with truckload carriers that will
deliver heavy goods like furniture that are ordered online.
Under UPS policy, a parcel will not be accepted for
standard transportation if it has any one of three charac-
teristics: its actual weight exceeds 150 pounds, its length
exceeds 108 inches, or its combined length and girth
exceed 165 inches. Packages that fall outside any
of those limits and are found in the UPS
small-package system are subject to an
“Over Maximum Limits” surcharge
in addition to other applicable
charges.

UPS said it wants to encourage its shippers to use the company’s less-than-truckload (LTL) network for these items rather than its small-package infrastructure. The company’s small-package network was not designed to efficiently handle big and heavy goods, and it requires what the company called “extraordinary special handling” at high labor expense to process them. A parcel industry executive who asked for anonymity said UPS has effectively drawn a line in the sand as to what types of shipments will move through its system without exorbitant surcharges attached to them.

BEHAVIOR MODIFICATION

Melissa Runge, vice president of analytical solutions for Spend Management Experts, a parcel consultancy that helps high-volume UPS shippers control their shipping costs, said the fee is designed to influence shippers’ behavior by hitting them in the pocketbook, as well as to compensate UPS for the cost of the audits. For example, one way for a shipper to avoid a dispute over dimensions is to use the same packaging that clearly fits within UPS’s dimensional requirements, Runge said. That might be exactly what UPS wants, she added.