If you are a company and you use United Parcel Service, UPS hereafter, take note. This article is about how they operate and bill you, the customer, their bread and butter, for the services they provide.
Now generally, most folks think of UPS as a company that has been around for years and as one that they can trust. I personally have attended classes regarding shipping and receiving for businesses that focus on this giant of a company for days…Why? Because of issues with their accountability.
Let me give you an example of something that I discovered recently myself. Here we go:
I work for a company that uses UPS for shipping their product to a number of States here in the United States. Volume shipping. Do you do volume shipping? Did you know that the “pick up” date on the UPS bill is not the actual date that the driver picks up and scans the item? The actual date that appears on the bill is the date that you create the label! Yes, the date you create the label! So, if you do volume shipments, and create the labels ahead of your volume shipment going out, know that the bill from UPS will show a “pick up” date that is incorrect!
Why is that? Because the date that you create the label is the date that the UPS billing system has been programmed so that this appears as the “pick up” date on your billing. The date that the UPS driver shows up at your business and uses the cute little device that he carries to scan the bar code on your package should be the pick up date on your bill. This is actually called, on the UPS system, the “origin scan” date.
Let us look at this a bit closer up. What could this mean to your company? Let’s just do a hypothetical situation here to explain this. You are required by the State of Ohio to pay sales tax for items you offer to residents of Ohio. You are a company, let’s say, in the State of California. We are not looking at how you make the sale but that the sale was made. You take an order on July 31st of this year, and you pick the items from your inventory, and you have your staff package them so that they are ready for shipping on the 1st day of the following month. No issues yet — right? The UPS driver scans and picks up the item on August 1st.
Here is the rub. Taxes are due based upon shipping date. Your records indicate that you shipped on August 1st, but the UPS billing that you have indicates a pick up date of July 31st. Now, the State of Ohio sends an auditor to your office. They want to examine the records. The auditor wants to see your UPS bill that includes the July 31st date. You show this to them. They ask to see your records. You show them your record as this having shipped on the 1st of August. The auditor asks why the dates do not jive. How come the UPS bill shows a pick up date of one day earlier than your records state? Why did you not report the sale in July rather than August? States, for tax purposes rely on the shipping date and they use your business UPS record as evidence for this claim. We are no longer in the days of filling out a written record that the driver actually has to sign and date. They rely on what the bill states, and it states a pick up date of July 31st. See the rub?
What is the answer from any UPS customer service representative that you might speak to? We expect you to ship the package on the day that you create the label. So, we not only reference that date on your billing as the actual shipment date, but we also notify your customer that the item has been shipped, that is if you provide us with an email address for your customer. What happens then? You get an influx of calls from customers wanting to know where their shipment is as they received notification from UPS that it has shipped. So, your volume shipping has issues. By the way, I was told by the UPS customer service folks that I can always go out and do a package tracking to show the label creation date, origin scan date, etc. My question to them: Why should I have to? Your billing should be based on the scan that occurs at my facility by your representative, not on the date that I create a label. UPS does not take possession of any package from my company until the driver comes in and scans the package or packages.
What else can happen with the “pick up” date that your company UPS bill shows? You might have an item waiting to ship, that has not yet shipped, but based on the label creation date you can be billed for that item that has not left your facility! If you do volume shipping, do you check each and every transaction to ensure that it left your site? Well, you should! Where I worked we were billed a phenomenal amount for a package that never left our site, and yet we were billed. Was this a situation that was easy to take care? No. UPS insisted that they had the package in their possession. While I spoke to their representative I stood there looking at the package physically in front of me, reading from the label on it. Yes, this item was in my shipping bay and I knew that the package had not left my facility, and that this shipment would not go out as the order was cancelled. UPS admitted that they knew that they had not picked up the package and reluctantly they adjusted the bill.
In business there is one thing that I have learned: Never trust anyone. That includes not only people, but businesses themselves. Now, I ask you: How closely do you, or someone that works for you examine your UPS billing records? After reading this article, will you be giving this bill a better review? You might want to think about it!