UPS billing Changes: Audit Fee for Shipping Charge Corrections
Up until recently, UPS billing has been pretty lenient with shipping charge estimates. Although you may know your products pretty well and the costs of your shipments, you’re may get charged by UPS billing the next time you estimate wrong. As of June 2020, UPS billing now charges for shipping corrections. Let’s take a closer look at how it all works and what new fees e-commerce sellers can expect.
How Will the New UPS Charges for Shipping Corrections Work?
UPS put the new Shipping Charge Corrections (SCC) into effect after receiving an increase in shipping fee inconsistencies. The UPS charges take the form of an audit fee that’s applied for any shipping charge corrections. This audit fee will be charged in the amount of $1.00 per adjusted package or 6% of the adjusted revenue for that week’s invoice, whichever amount is the greater of the two.
What Corrections Will Cause You to Incur the Additional UPS Shipping Charges?
Here are a few scenarios in which you may see these UPS shipping charges:
· Let’s say you just mailed out a shipment to a customer, and your package has missing or incorrect dimensions. After the package dimensions have been correctly updated, this results in UPS billing adding additional surcharges (such as the Large Package Surcharge or the Additional Handling Service).
· You’ve given UPS a package that is missing a correct record of its dimensions. If your package is missing dimensions that result in a new dimensional weight being billed, then this will trigger the new UPS shipping charges for corrections.
· If your package was given to UPS with the incorrect weight, which resulted in the package having to be reweighed or triggering a dimensional adjustment.
· If the package has an incorrect address manifested, you can expect the new UPS fees to be applied.
· If you don’t upload accurate weight and dimensions when manifesting a package.
If making a one-inch or one-ounce mistake sounds harsh, UPS agrees. The charge is set up to take effect only if the average correction for your shipment amounts to more than $5.00. So, a small mistake isn’t what UPS’ new shipping correction charge rules are about. But if you’re consistently misreporting weights and dimensions or repetitively failing to accurately calculate UPS shipping, then it’s time to clean things up. UPS is fine with an honest mistake here and there, but repeated errors or those that amount to being egregious are being targeted. Be prepared for those to result in a penalty.
What Are the New UPS Fees for These Surcharges?
There are a number of ways having incorrect information on your package can trigger additional UPS fees to be incurred, as we just saw. Now, let’s look at a few examples of corrections and the possible fees they could now incur from UPS.
· If you sent out 25 packages that needed corrections, and those corrections added up to $363.25. That equals $14.53, which is less than 6% of $363.25. Therefore, the UPS audit fee would be assessed at $1 per package (not the 6% fee).
· Let’s say you had 118 corrections on UPS packages that added up to $489.12, that would equal $4.15 per package. Therefore, no UPS audit fee would be assessed (because you’re at less than $5.00 average correction).
· Or if you had 5 packages you sent out with incorrect or missing information that resulted in a correction of $206.74. The per package correction amount would total $41.35, which would be greater than 6% of revenue and trigger an added UPS fee of $12.40 (6% of $206.74).