Every year, online sellers have to navigate new shipping rates that impact how they operate. This year is no different. On May 31, the U.S. Postal Service will be making changes for a variety of services.
This time, it’s a bit of a mixed bag — some prices are going up, some are going down and some are staying the same. We’ve sifted through the information and highlighted the top 5 things you need to know about this year’s USPS price changes.
Parcel Select rates are rising — mainly for Zones 5 and above
Parcel Select, which is exclusively available to those who print postage online, is increasing its rates by an average of $5 per package. Though this seems like a hefty bump, there’s less of an impact if you’re shipping something that is lightweight. For packages that weigh 5 lbs. or less, the price will only increase by an average of 70 cents per package. For Zones 1 to 4, packages weighing between 5 lbs. and 24 lbs., on average, will decrease in price by 14.8% or $9.86 a package. Rates are remaining the same for Zones 1-4 for packages weighing between 25 lbs. and 70 lbs.
Here’s a tip: If you print your postage online, Priority Mail Commercial Base prices are less expensive (and have faster delivery times) than Parcel Select, especially for packages going to Zones 1-4. For packages weighing 1 lb., Priority Mail is less expensive to all zones.
Canada is switching to zone-based pricing
One of the biggest changes this year affects those who ship to Canada; the USPS will now apply zone-based pricing to Priority Mail International packages headed there. This means shipping rates will be based on seven U.S. pricing zones rather than having one flat rate (depending on the package weight) for the entire country.
In the past, a package traveling from the tip of Texas to Toronto would cost the same as one traveling from New York City. But with zone-based pricing, the USPS can charge based on the actual U.S. origin ZIP code and Canadian destination postal code instead of having to factor expensive routes into one blended rate.
If you’re shipping from a major U.S. city close to an international mail processing facility, like New York or Miami, you can save on average about $8 per package. You’ll also see greater savings if you ship packages under 1 lb. or more than 13 lbs. However, if you’re shipping from somewhere like Wichita, KS, you’ll see an increase of around $6 per package.
Free tracking all around
Package tracking will become free for all domestic mail classes except Standard Mail. That means you can now receive end-to-end visibility with up to 11 scan events on shipments — from pickup to final delivery — without paying extra.
First-Class Mail Parcel (Retail) is getting a new name
If you physically ship packages at the post office and use First-Class Mail Parcel (Retail), this mail class may be changing its name to First-Class Package Service.
Used for items that weigh 13 ounces or less, this service will increase in price by an average of 30 cents per package if you ship at the post office. If you print postage/shipping labels online, the increase is considerably less — roughly 13 cents per package.
Priority Mail rates are staying the same
Last September, the U.S. Postal Service lowered Priority Mail rates for those who print postage online. Online sellers will be happy to know that this benefit isn’t going away, and they can continue to see big savings, especially for packages weighing more than 5 pounds.
Priority Mail is a great alternative to FedEx and UPS Ground, especially since these carriers have switched to dimensional weight pricing. It provides affordable rates for medium-sized packages and can deliver a shipment coast-to-coast in as little as two days.
While these rates changes are going to shake things up a bit, there are steps small businesses can take to mitigate them. For example, many businesses aren’t aware that they can qualify for a lower postage rate just by printing shipping labels online.
This is also a good time to re-evaluate your shipping mix to make sure you’re getting the most bang for your buck. The USPS continues to be a viable option for online sellers looking for low-cost, reliable shipping services, especially since it does not apply dimensional weight pricing to packages up to 1 cubic foot. The USPS also does not apply surcharges for residential or Saturday delivery, unlike private carriers.
The bottom line: Savvy online sellers know that the best way to navigate price changes is to stay informed and plan ahead.
Amine Khechfé is co-founder and general manager of Endicia