Threatened UPS Strike Could Cost US Economy Billions

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Jul 07, 2023

Threatened UPS Strike Could Cost US Economy Billions

“A looming strike at United Parcel Service (UPS) could have a sharp economic impact.” That’s the lead line in the latest coverage from PYMNTS on the ongoing dispute between UPS and its 340,000 Teamsters employees. The article goes on to put a dollar value of $700 million per day to the potential carnage. That number comes from findings from Anderson Economic Group, which estimates $7 billion in losses from a 10-day strike.

While some impacts will be measurable, others might not. Consumer sentiment surveys consistently show that a single bad delivery experience can cause customers to reconsider their brand loyalty. How will retailers measure the cost of lost goodwill with customers when orders don’t arrive? How many customers will switch allegiance to new brands based on poor delivery performance during a UPS work stoppage?

There has been movement among many retailers over the past few years to diversify their carrier mix, adding regional carriers in targeted markets. There are several benefits to this strategy, the most obvious being that if your one and only carrier network is interrupted for any reason, you can more easily pivot and continue shipping orders through your other carriers. But risk mitigation isn’t the only benefit. AxleHire provides next- and even same-day delivery at a cost comparable to national carrier ground rates, with on-time delivery performance in excess of 99% and a level of customer service that national carriers can’t match.

Diversification of your carrier mix is a strategy that makes sense today, and it will still make sense when the fallout of the UPS situation is behind us. To connect with one of our logistics experts to discover how you might benefit from a more diversified mix, click here.