In this episode of Parcel Perspectives, Glenn Gooding and Brett Haskins, COO of iDrive Logistics, dive into the sweeping changes set to reshape the shipping industry following the recent UPS and FedEx demand surcharge announcements. They break down how major carriers are shifting from temporary "peak season surcharges" to more permanent "demand surcharges," a response to growing e-commerce pressures and market demands. This change is critical for all shippers to understand as they prepare for future logistics and pricing strategies.

Key highlights include an expected rise in shipping costs for 2025, driven by fuel price increases and strategic changes from UPS, FedEx, and the US Postal Service. Glenn and Brett discuss the end of subsidized shipping, the impact of hyperinflation, and how brands can adjust pricing without losing their competitive edge. They also stress the importance of Q4, where efficient shipping and fulfillment are essential for customer acquisition and retention during the holiday season.

The episode offers practical tips for navigating the new demand surcharge landscape. Glenn and Brett highlight the importance of accurate demand forecasting, building strong relationships with carriers, and adopting multi-sourcing strategies to reduce reliance on a single carrier. Brett shares actionable insights on aligning operational strategies with carrier requirements, enhancing customer shopping experiences, and using expert advice to minimize the financial and operational impacts of these surcharges. This conversation equips listeners with the knowledge and tools needed to succeed in an ever-evolving shipping market.

In this episode of Parcel Perspectives, host Glenn Gooding tackles the complex topic of fuel surcharges in the small parcel shipping market. He begins by explaining why shippers might experience cost increases even after careful planning for general rate increases (GRIs). Glenn breaks down fuel surcharges into three main aspects: their definition and purpose, their impact on logistics budgets, and strategies to mitigate or negotiate these expenses effectively.

Glenn provides a detailed analysis of how carriers like UPS calculate fuel surcharges using Department of Energy fuel price indexes and adjust these surcharges weekly. He highlights historical trends to show how carriers subtly increase surcharges over time, likening it to the analogy of "boiling a frog"—where incremental changes can go unnoticed. An illustrative example is given to demonstrate the financial impact on shippers, emphasizing that the cost of shipping a typical parcel has significantly increased due to fuel surcharge adjustments over the past few years.

Wrapping up, Glenn discusses negotiation tactics for shippers to handle fuel surcharges better. He stresses the importance of a holistic approach in carrier negotiations, cautioning against focusing solely on one aspect like fuel surcharges while neglecting others such as accessorial fees. Glenn's extensive experience in the industry validates his insights and strategies, as he has worked with a diverse range of clients, from Fortune 50 companies to startup e-commerce businesses, guiding them through the intricacies of the small parcel shipping market.

In this episode of Parcel Perspectives, host Glenn Gooding delves into the recent exit of Pitney Bowes Global E-commerce and its significant impact on the industry. Glenn explores the challenges facing postal aggregators, including rising network, labor, and postal costs, as well as the implications of USPS's proposed price increases for lightweight parcels.

He discusses the future of subsidized shipping programs, predicting that popular free shipping options for low-cost orders may face challenges by 2025 due to increasing shipping costs. These changes could reshape the residential market and affect pricing strategies for carriers like UPS, FedEx, and regional couriers.

Drawing on over 37 years of experience in the small parcel shipping industry, Glenn offers expert insights and strategies for businesses to secure favorable contract terms and maintain a competitive edge. His experience spans a range of clients, from Fortune 50 companies to startups, providing actionable advice for navigating the evolving shipping landscape.

In this episode of Parcel Perspectives, host Glenn Gooding, delves into the imminent changes looming over the small parcel shipping industry, with a specific focus on the proposed parcel select rate increase by the United States Postal Service (USPS), set to take effect on July 14, 2023. Postmaster General Louis DeJoy has proposed rate hikes ranging from 23-70%, a move that could significantly impact postal aggregators such as DHL eCommerce, UPS Mail Innovations, and others. Glenn provides a detailed explanation of parcel select, its current operational dynamics, and the key role it plays in the shipping market. The potential effects of these increases on e-commerce shippers, particularly those shipping lightweight products to residential destinations, are scrutinized, with an emphasis on the double-digit cost increases they may face.

To help shippers navigate these challenges, Glenn outlines several mitigation strategies. He suggests exploring alternate carriers, such as FedEx Ground Economy and UPS SurePost, which could offer more favorable terms and help cushion the financial blow. The potential of regional carriers is also discussed as a viable alternative, provided shippers have the requisite volume and geographic alignment. Additionally, Glenn highlights the necessity for proactive communication with carriers like DHL eCommerce, UPS Mail Innovations, and others to understand their plans and develop contingency strategies in anticipation of the upcoming changes.

Glenn Gooding, the episode's host, is the President of iDrive and has a rich history in the small parcel shipping industry, spanning 37 years. His career began with a major carrier where he worked as an operator and industrial engineer, eventually managing pricing at high levels for large, complex shippers. Recognized as a national thought leader, Glenn has helped shape strategies for clients ranging from Fortune 50 companies to startup e-commerce businesses. This expertise positions him well to provide insightful analysis and actionable advice, aimed at helping shippers stay competitively aligned in an increasingly complex and costly market.