New (sky-high) UPS Ground rates went into effect for all businesses late last week. UPS has changed the way they calculate ground charges with a big emphasis on volume. The largest impact is on shipping big boxes that don't weigh very much (like XD case boxes) traveling a long distance. What used to cost us $22.00 to ship across the country a few days ago has suddenly changed to $34.00. What's the wholesale cost to ship a case of Avengers from California to Georgia?--$40.11
That's a lot of money.
In many cases it will be cheaper to send four separate TBMs, individually wrapped, rather putting them into one box.--How terribly wasteful and expensive!
Also involved are the shipping costs of sending merchandise from the manufacturer to the dealer which will go up the same amount on smaller orders not palletized. Because of the prohibitive cost of shipping XD case boxes through UPS Fedex or DHL Ground, East Coast 1:18 dealers will be forced to buy larger quantities (which increases interest and facilities expense) in order to sell 1:18 and 1:32 at economically viable prices. Very large orders are put on pallets and can be sent by independent trucking firms often sacrificing speed and reliability in return for lower fees.
It would seem the big three Ground companies are moving in tandem on this one in an effort to grab lots of money. We spoke with our UPS representative today and he said he is hoping management will rethink this gouge. He also said that Fedex plans on making the same big increase Feb 5th along with DHL.
For 2007, smaller items, such as an XD single, costs a dealer about $12 to ship to a customer coast to coast, with packaging and supplies $2-3 dollars more. Dealers charging less than this amount (ourselves included) are subsidizing part of this cost from product markup.
From a consumer's standpoint, a number of strategies may help. Small packages 2 lbs and under can be sent cheaply and quickly using USPS Priority Mail (Anyone ready for 1:72 scale?). Buying from a dealer only 1 or 2 zones away should translate into big savings (remember, box size and distance are now more costly). And I hate to admit it but that trip to the local Wally is looking better all the time.
