5 Contingency Strategies for a UPS Strike

It seems like labor strikes are the latest trend this year. The Writers Guild of America—which consists of 11,500 screenwriters—has been on strike since early May, and just this month, the Screen Actors Guild also initiated a strike. It’s safe to say the film and TV industry are facing a full-on labor revolt.  

But the entertainment industry isn’t alone in facing labor woes.  

With contract negotiations stalled between UPS and the Teamsters and a fast-approaching deadline for an agreement, 340,000 warehouse workers, drivers, and other UPS employees could walk off the job on August 1. According to NPR, this “would be the largest strike against a single employer in U.S. history,” and the effects could last into peak shipping season.

Whether you’re an ecommerce or a logistics professional, the threat of a UPS strike is much more concerning than anything Hollywood is currently facing. Thankfully, there are actions you can take now to secure your last-mile delivery strategy if the strike does happen. Read on for our top 5 tips for what to do in case of a UPS strike.

1. Work on a Contingency Plan Now

It's getting late in the year—holiday shopping season is just around the corner—so make sure you are working with your partners to identify risk, exposure, options, and contingency plans if this strike lasts into peak season. Switching accounts needs to be orchestrated and should be well-planned to avoid disruption.  

2. Diversify Your Carrier Usage

To remain flexible, you must diversify your carrier usage so you have multiple shipping options available. In other words, if plan A doesn’t work, you need not only a plan B, but a plan C, D, etc. because UPS’ competitors will not be able to take on all the additional volume from a strike. Unless you have a good relationship with FedEx or are bringing significant volume from UPS, your shipments will be the first to be delayed when FedEx hits their capacity limits. The solution? Diversify with USPS for shipments that can leverage 3- to 5-day delivery.

Looking for more tips on how to work with freight carriers in advance of peak season? Download the 2023 3PL Peak Season Playbook for advice from our expert shipping partners Pitney Bowes, ShipEngine, and BUKU Ship.

3. Geographically Disperse Inventory

Simply put, geographic fulfillment diversity de-risks the supply chain. Keeping inventory closer to consumers means you can rely on USPS for short, cost-effective delivery times and also regional carriers that would be excluded if you only have one distribution point.

4. Stay on Top of the Strike Deadline

Be cautious of the strike deadline (expected on August 1st assuming talks are unsuccessful) and be wary of tendering packages to UPS 7 to 10 days prior to the deadline. It is possible that packages in their possession when/if the strike starts will not be delivered until after the strike is resolved. You don't want packages held in transit for weeks with no options for delivery. Additionally, this timeline may force retailers to order stock earlier than usual, so have a game plan to get these urgent orders delivered.

5. Explore Alternatives to Amazon Fulfillment  

Though Amazon has rapidly built out its delivery arm, Amazon Logistics, the ecommerce giant still uses “UPS for long-haul, typically two-day deliveries of goods normally not stocked in Amazon’s warehouses,” according to Satish Jindel, founder and CEO of consultancy ShipMatrix Inc. While Amazon is undoubtably working on contingency options, it is possible that Fulfillment by Amazon (FBA) orders may be delayed. It might make sense to stock extra inventory at a third-party logistics (3PL) warehouse to fulfill by merchant so you can control the transit times, carriers, and services.

How Extensiv Can Help

Extensiv’s suite of warehouse management, inventory management, and order management software and partnerships can help you navigate the uncertainty of a potential strike. Leverage automated rate shopping to compare shipping rates across multiple carriers at once to keep shipping costs low. Additionally, users of Extensiv’s 3PL Warehouse Manager can link to a variety of services such as Pitney Bowes, Stamps.com, DHL, and more to generate shipping labels. See the full list of available shipping services in Small Parcel Suite here.  

While there is still a little time left for UPS to settle with the Teamsters, you can't afford to wait and see what happens. Prepare your contingency plans now.