UPS Strike To Drastically Increase Spot Market Prices
UPS vs. Teamsters
UPS and the Teamsters UPS Freight National Bargaining Committee (TNUPSFNC) recently concluded a series of labor contract meetings on October 25, 2018, resulting in a ratified master agreement between the two parties. According to an update from UPS.com, the offer seeks to reward UPS employees with higher wages and better benefits to compensate for their contributions to the success of the company. Union members are scheduled to vote on the proposed agreement between November 7th and the 11th of this year.
Following the meetings, TNUPSFNC stated that they believe UPS Freight’s offer should be ratified. Should the joint vote result in a “no,” UPS is preparing for the worst… a strike, already pre-approved by the committee. However, if the vote ends in favor of the ratified master agreement, service will resume as normal on November 12, 2018.
Possible “Domino” Effect
UPS Freight is halting pickups ahead of time to account for the impending strike. UPS stated that they can only ensure the delivery of ground (LTL) shipments through November 8, 2018. A strike could mean a large spike in spot market prices, ahead of already increased prices for the approaching holiday season. If this strike goes into effect, it will be the first strike for UPS employees since 1997.
Maintaining Cost Efficiency
The significant increase forecasted in spot market prices means higher-than-expected costs for your supply chain as the 2018 holiday season ramps up, which raises an important question:
How can you maintain holiday supply chain cost efficiency?
The answer… stay away from the spot market as much as you can during the holidays. Furthermore, a key trick to avoid high spot market prices in 2018 is to strategically partner with a third-party logistics provider with an already established network of dedicated carriers at their disposal. Joining forces with the right third-party logistics provider over the 2018 holiday season should also improve the overall bottom line of your supply chain costs.
BM2 Freight Services, Inc.
Phone: (859) 308-5100
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