Learn about the new USPS rate adjustments and how it may adjust your peak season strategy
Just last week, the USPS released the temporary price changes for several package products for the upcoming 2022 peak season and will go into effect on October 2, 2022. These price rate changes will go through January 22, 2023.
The rate increases will affect both commercial and retail domestic parcel shipping including Priority Mail Express (PME), Priority Mail (PM), First-Class Package Service (FCPS), Parcel Select, and USPS Retail Ground. Again referencing “Delivering for America,” the 10-year Postal Service plan for achieving financial stability and service excellence, the USPS argues that these rate increases will keep USPS competitive while covering the extra costs that peak-season volume brings.
Priority Mail and Priority Mail Express
Let’s look at what is changing for Priority Mail and Priority Mail Express:
Commercial:
- $0.75 increase for PM and PME Flat Rate Boxes and Envelopes.
- $0.25 increase for Zones 1-4, 0-10 lbs.
- $0.80 increase for Zones 5-9, 0-10 lbs.
- $0.75 increase for Zones 1-4, 11-25 lbs.
- $2.80 increase for Zones 5-9, 11-25 lbs.
- $3.00 increase for Zones 1-4, 26-70 lbs.
- $6.50 increase for Zones 5-9, 26-70 lbs.
Retail
- $0.95 increase for PM and PME Flat Rate Boxes and Envelopes.
- $0.30 increase for Zones 1-4, 0-10 lbs.
- $1.00 increase for Zones 5-9, 0-10 lbs.
- $0.95 increase for Zones 1-4, 11-25 lbs.
- $3.20 increase for Zones 5-9, 11-25 lbs.
- $3.25 increase for Zones 1-4, 26-70 lbs.
- $6.45 increase for Zones 5-9, 26-70 lbs.
First-Class Package Service, Parcel Select Ground and USPS Retail Ground
Let’s look at what is changing for First-Class Package Service, Parcel Select Ground and USPS Retail Ground:
Commercial
- $0.25 increase for Zones 1-4, 0-10 lbs.
- $0.40 increase for Zones 5-9, 0-10 lbs.
- $0.75 increase for Zones 1-4, 11-25 lbs.
- $1.60 increase for Zones 5-9, 11-25 lbs.
- $3.00 increase for Zones 1-4, 26-70 lbs.
- $5.50 increase for Zones 5-9, 26-70 lbs.
Retail
- $0.30 increase for Zones 1-4, 0-10 lbs.
- $0.60 increase for Zones 5-9, 0-10 lbs.
- $0.95 increase for Zones 1-4, 11-25 lbs.
- $2.70 increase for Zones 5-9, 11-25 lbs.
- $3.25 increase for Zones 1-4, 26-70 lbs.
- $5.85 increase for Zones 5-9, 26-70 lbs.
In addition, the following products have these changes:
- Parcel Select Destination Delivery Unit (DDU) will increase $.25.
- Parcel Select DSCF and DNDC will each increase $.75.
2022 Peak Season Success
While these changes don’t come as a surprise, they do serve as a prompt reminder that shippers should be thinking about how their peak season shipping strategies will fair for not only this year, but the years to come. And while we don’t know exactly what the 2022 peak season will bring yet, over half of shippers in a recent DC Velocity survey expect that this year will be worse than 2021.
One thing that everyone can agree on? Shipping costs aren’t going down. Containing shipping costs is on the mind of all shippers and one of the strategies that many are employing is giving more packages to the USPS. In fact, 42% of shippers surveyed in the 2022 Shipware & Parcel Shipper Survey used this tactic to manage shipping costs.
While diversifying your carrier mix is a strategy that some may have already adopted, it should be applied with your shipping profile in mind. Rather than onboard a slew of carriers that you don’t use or complicate your supply chain even further, dive into your data to identify your channels that need help. Look for underperforming carriers, areas where capacity constraints existed, or the worst customer experiences were found. This data should provide insight into the carriers that fit into your 2022 peak game plan.
Preparation is key, here.
Be prepared with data from past peaks to know what you can expect in your business for the upcoming year. [Think Visibility and Business Intelligence Tools]
Be prepared with technology that can facilitate specific tactics that are proven to ease supply chain strain and offer critical cost-saving opportunities. [Think Ship-From-Store and Rate Shopping]
Be prepared with functionality that can automate changes to your strategy as needed, i.e. the flexibility to pivot to different carriers or services to find capacity or meet evolving customer expectations. [Think Carrier Diversification and Omnichannel Fulfillment]
There is one piece of software that facilitates these acts of preparation: multi-carrier shipping software. Multi-carrier parcel shipping software connects the dots between the expectations of online shoppers and the technological functionality required for brands to meet these expectations. Elite vendors know that flexibility is crucial for being able to pivot as these evolving needs change as well as an expert support team who prioritizes and understands your unique business nuances. ProShip’s resume includes some of the top brands who trust our solution for its millisecond transactional speed, as well as unwavering dedication to compliance. A focus on these 4 tenets (speed, compliance, support and flexibility) will enable not only positive customer experiences, but an optimized transportation budget.
Looking for help with your peak season strategy?
Contact us to learn more about implementing an agile and automated shipping software to achieve supply chain success!