Sunday marks an important date for e-commerce marketers: USPS shipping rates are going up. The date may have seemed a long way off before the holiday rush, when package senders first learned Priority Mail fees would rise about 9.8 percent. After all, about 15 billion mail pieces and packages needed to be delivered by the new year. But the day of reckoning is here.
The new shipping rates are pictured below.
Yesterday, Pitney Bowes — known for its postage meters — sent Target Marketing advice for marketers, as well as a reaction to the rate increase.
“Recent rate increases for shipping services by UPS and FedEx and the pending [Sunday USPS] rate increase … have prompted businesses — especially small retailers and e-retailers — to look for new and innovative solutions to optimize their mission-critical shipping operations,” reads the company statement. “In addition to the latest round of price increases and surcharges, businesses across the country continue to grapple with exploding parcel volumes and the complexity of managing multiple disparate carrier rate structures and systems.”
Indeed, USPS notes that package delivery is growing as First Class mail volume — once the postal service’s main revenue stream — is drying up. On Dec. 21, Postmaster General and CEO Megan J. Brennan said USPS experienced a 15 percent YOY growth in package volume.
“In this new world of commerce, shipping has become even more critical as businesses compete for and serve clients remotely and connect with their vendors and suppliers,” says Pitney Bowes VP Jeff Crouse in the company statement. “However, small and medium businesses, in particular, face an uphill challenge to manage rising costs, increasing complexity and growing volume of sending, which includes everything an organization sends out, from parcels and overnight envelopes, to bills and statements.”
Accordingly, the company had a couple of suggestions for marketers who are looking to optimize their package shipping spends:
- Streamline. Match your sending strategy to your customer and business needs. Select the best mix of carriers that best serves your customers’ delivery requirements and meets your business objectives. In other words, don’t put all of your eggs in one basket.
- Eliminate Wasted Space. With both FedEx and UPS imposing “Dimensional Weight Rating” on all parcels, outer packaging should consist only of that which is necessary to properly secure the enclosed items and provide protection during transport. Don’t ship small items in a big box.
USPS emphasizes in a response to Target Marketing yesterday that the postal service isn’t “implementing any new dimensional weight charges.” Also, this is the postal service’s first price increase on commercial Priority Mail in more than three years.
In a related matter, USPS may roll back its exigent rate increases during the first week of April, while simultaneously appealing a court decision that calls for the rate to expire, according to Wednesday's newsletter from Grayhair Software. "Brennan announced that the exigency rate surcharge is scheduled to be rolled back the first week of April," reads the newsletter. "A 45-day notice will be issued in February."
What do marketers think?
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Related story: USPS Rates Go Up Again