UPS Mail Innovations is notifying customers of price increases as it adapts to rate changes from the U.S. Postal Service.
"To align our pricing with the cost to serve, some account-specific adjustments are necessary," a May 1 letter to customers viewed by Supply Chain Dive said. "Your UPS sales team will provide information specific to your account."
Some businesses encountered a 40% rate increase that took effect Sunday, according to UPS emails to shippers shared with Supply Chain Dive.
UPS Mail Innovations will also levy a $1.75 per-package fee for deliveries in "extended area" ZIP codes where UPS' Delivery Area Surcharge applies, the letter said. The added charge applies to Parcel Select and Ground Advantage shipments starting May 11. UPS Mail Innovations will also begin enforcing a 1.5% late fee on invoices in delinquency on that date.
UPS did not respond to a request for comment from Supply Chain Dive regarding the communications prior to publication time.
UPS Mail Innovations offers processing and transportation services for parcels and mail. The UPS arm has historically handed off volume to the U.S. Postal Service for last-mile delivery, but the Postal Service rolled out pricing changes last year. This forced shipping partners to adjust their operating models — UPS' Ground Saver service, formerly known as SurePost, cut ties with the Postal Service at the start of 2025 as a result.
New Postal Service rates for Mail Innovations shipments drove a Q1 operating margin decline for UPS' Supply Chain Solutions business, which Mail Innovations is part of, UPS EVP and CFO Brian Dykes said on an earnings call last week.
Since the Postal Service changes, UPS Mail Innovations has "introduced an enhanced mail solution leveraging third party vendors" that aims to provide faster service and greater reach, according to the May 1 letter to customers. UPS did not specify the vendors involved in the solution.
"UPS's end-to-end hybrid product enables consistent performance, unaffected by USPS network redesigns or disruptions," the letter said.
UPS Mail Innovations customers will also be able to use a local same-day delivery option in major metropolitan markets, the letter said, without naming the markets covered.
