Ecommerce News
2020 USPS Rate Increases
The USPS has proposed its 2020 rate increases starting January 26, 2020. Learn more about what to expect from the upcoming changes.
2020 has brought us Tiger King, an extra 20-pounds of quarantine weight, and a massive influx of ecommerce orders. (See how e-Commerce has been affected by COVID-19 HERE) And although we could go on and on about Carol Baskins, we know what you are here for: shipping. Since the beginning of the pandemic, not only have companies been tasked with trying to figure out to work from home, follow CDC guidelines, and keep their customers happy, due to the large influx of online purchases, businesses are scrambling to fulfill orders correctly and in a timely order. It is all been a bit harder than expected.
Keep Calm and Ship On
With the already massive increase in sales in 2020, preparing for the holidays means more shipping thus increasing the need for more employees. And with carriers frantically hiring more employees to keep up with logistic demands, price increases are inevitable. Q4 usually sees a 3-4% increase in ecommerce sales, COVID-19 not included. USPS is the first company to announce their shipping increase for Q4 (though we do not think they will be the last). The USPS increase will begin October 18th, 2020 and is as follows:
|
Product |
Current |
Planned Increase |
|
Parcel Select Destination Delivery Unit (DDU) |
Starts at $3.19 |
24 cents |
|
Parcel Return Service |
Starts at $3.05 |
24 cents |
|
Parcel Select Lightweight |
Starts at $1.81 |
24 cents |
|
FCPS Commercial |
Starts at $2.74 |
25 cents |
|
Priority Mail Commercial |
Starts at $7.02 |
40 cents |
|
Parcel Select Ground |
Starts at $4.37 |
40 cents |
|
Parcel Select DSCF |
Starts at $4.37 |
40 cents |
|
Parcel Select DNDC |
Starts at $5.98 |
40 cents |
|
Priority Mail Express Commercial |
Starts at $22.75 |
$1.50 |
** Some rates cells in Parcel Select Ground will be charge less than $0.40 so as not to exceed USPS. For a full list of commercial pricing click here.
Courtesy of USPS.
What does the price increase mean for companies and their customers? Companies will have a small increase for shipping and will need to determine if shipping costs will be covered or billed to the customer. Read the importance of offering free shipping HERE.
Not sure how your company can offset this shipping increase? Here are some ideas:
Buy More to Save
The best way to offset this price increase, while still offering free shipping, is increasing the amount the customer purchases to get free shipping. By changing your promotion from, “free shipping on all US orders more than $50” to “free shipping on all US orders more than $75”, you are prompting your customer to purchase more while also helping your bottom line.
Exclusive Offers
Offer free shipping only to customers who are integrated with your rewards or loyalty programs. This will help increase the amount of loyalty members for your business, create an environment of exclusivity so they feel like they are receiving special treatment, on top of saving you dollars on non-return customers.
Flat-Rate Shipping
No matter the order size, offer a flat rate shipping for overnight, 2 day and extended shipping. Offering a flat rate will offset those orders that are huge verse small orders that will end up costing you less than the price the customers is paying for shipping.
Utilize a Shipping Solution
At the end of the day, customers love free shipping on all orders. They also love free returns on all orders. To keep those purchases coming and your customers happy, hiring a shipping solution is the best way to save money. With a company like DesktopShipper, you can real-time rate shop to ensure packages are going out with the best possible rates. You can integrate your negotiated shipping rates with all carriers too! Don’t wait until you are downing in shipping labels come November. Sign up today!
