Question 1

Is my company big enough to negotiate with UPS?

Accepted Answer

It's less about your company's size and more about the quality of your shipping data and your negotiation strategy. While companies with higher annual shipping spend have more natural leverage, businesses across a wide range of volumes can achieve meaningful rate improvements. The key is entering the conversation with detailed data analysis and a clear understanding of your shipping profile.

Question 2

What's more important to negotiate: base rate discounts or lower surcharges?

Accepted Answer

Both matter, but accessorial surcharges often have a larger impact on your total costs than base discounts. Fees like residential delivery surcharges, delivery area surcharges, and fuel surcharges can add 20 to 40 percent on top of your base rate. A big base discount that still leaves you with uncapped surcharges may deliver less value than a smaller discount paired with hard caps or reductions on key accessorial fees.

Question 3

How often should I be reviewing and renegotiating my UPS contract?

Accepted Answer

Your shipping agreement should not be a static document. It's good practice to conduct a thorough review of your contract annually, particularly after UPS announces its General Rate Increase each year. You should also consider renegotiating when your shipping volume changes significantly, when you are adding or dropping service types, or when you receive a competitive offer from another carrier.

Question 4

What information should I bring to a UPS rate negotiation?

Accepted Answer

You should arrive with at least 12 months of detailed shipping data broken down by service type, zone, weight band, and accessorial charge. You should also have a clear picture of your projected volume growth, benchmarking data showing what rates similar shippers have achieved, and a prioritized list of the contract terms that have the largest impact on your actual costs.

Question 5

Can I keep my current UPS account manager if I renegotiate with outside help?

Accepted Answer

Yes. Using a consulting firm or optimization service does not change your UPS account relationship. Your account manager remains your primary contact, and most optimization engagements are conducted confidentially without disclosing the use of outside advisors.

The Insider’s Guide to UPS Rate Negotiation Services

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