Postal Rate Decrease: How to Take Advantage of Lower Shipping Costs

In this article, we’ll explore the recent Postal Rate Decrease and how you can leverage these changes to save money on your shipping costs. We’ll take a closer look at the details of the decrease, how it will affect your business, and tips for adjusting your shipping strategy to take advantage of the lowered rates.

The New Postal Rates: A Detailed Look at the Changes

The Postal Rate Decrease went into effect on April 10, 2016, and is the first rate reduction since 1919. The decrease affects First-Class Mail, Standard Mail, and Parcels, with an average reduction of 4.3%. Some of the specific changes include:

• First-Class Mail: A decrease of 2 cents, from $0.49 to $0.47 for a one-ounce letter.
• Standard Mail: A decrease of 4.1%, with some specific changes based on weight, size, and destination.
• Parcels: A decrease of 9.4% in Priority Mail and 3.9% in Priority Mail Express.

While these changes may seem small, they can add up to significant savings for businesses that do a lot of shipping. Let’s explore how these changes will affect your specific business.

It’s important to note that not all mail categories will see a decrease in rates. For example, international mail rates will remain the same, and some categories of mail, such as periodicals, will actually see a slight increase in rates. Additionally, while the decrease in rates may be beneficial for businesses that do a lot of shipping, it may not have as much of an impact on individuals who only send mail occasionally. Overall, the new postal rates represent a significant change in the postal industry and will have varying effects on different types of mail senders.

How the Postal Rate Decrease Will Affect Your Business

Depending on your business’s shipping volume and needs, the Postal Rate Decrease could have a variety of effects. Here are a few possibilities:

• If you ship a lot of letters or small packages, you’ll see a direct decrease in your shipping costs.
• If you use First-Class Mail for marketing campaigns, you may be able to expand your budget and reach more customers.
• If you ship larger parcels, your savings may not be as significant, especially if you’re using expedited services like Priority Mail Express.

Overall, while the Postal Rate Decrease may not drastically change your shipping costs, it’s still important to take advantage of the savings where you can. Here are some tips for doing just that.

One way to take advantage of the Postal Rate Decrease is to consider switching to USPS for your shipping needs if you haven’t already. With the decrease in rates, USPS may now be a more cost-effective option compared to other shipping carriers.

Another way to save on shipping costs is to take advantage of USPS’s online shipping tools. By using tools like Click-N-Ship, you can save up to 16% on Priority Mail and up to 60% on Express Mail. Additionally, you can schedule free package pickups, saving you time and money on trips to the post office.

Tips for Saving Money on Shipping During the Postal Rate Decrease

1. Look for opportunities to switch to First-Class Mail. While this may not work for all shipments, it can be a cost-effective option for letters and small packages.

2. Evaluate your packaging. The reduced Parcel rates make this a good time to assess your packaging and identify opportunities to lower costs.

3. Compare rates between carriers. With the lowered rates, it’s worth taking the time to compare costs between USPS, FedEx, and UPS to find the most cost-effective option.

4. Consider negotiating with your carrier. Even if you don’t have a large shipping volume, it’s still worth seeing if you can negotiate lower rates based on the Postal Rate Decrease.

5. Use technology to your advantage. There are a variety of tools, from tracking software to postage meters, that can help you streamline your shipping process and reduce costs.

6. Take advantage of free shipping supplies. USPS offers a variety of free shipping supplies, including boxes, envelopes, and labels. Using these supplies can help you save money on packaging costs.

7. Consider consolidating shipments. If you frequently ship to the same location, consider consolidating multiple shipments into one larger shipment. This can help you save money on shipping costs and reduce your carbon footprint.

Comparing Shipping Rates: USPS vs. FedEx vs. UPS

It’s important to compare shipping rates between different carriers to find the best deal for your business. Here is a quick overview of the rates for USPS, FedEx, and UPS:

	USPS	FedEx	UPS
First-Class Mail (1 oz. letter)	$0.47	N/A	N/A
Priority Mail (1 lb. package)	$5.75	$10.85	$11.30
Priority Mail Express (1 lb. package)	$22.95	$30.75	$38.00

As you can see, there are differences in rates between the carriers, so it’s worth comparing to find the best deal for your needs.

It’s also important to consider other factors besides just the shipping rates when choosing a carrier. For example, some carriers may offer faster delivery times or better tracking options. Additionally, some carriers may have restrictions on certain types of items or destinations. Be sure to research and compare all aspects of each carrier before making a decision.

How to Negotiate Lower Shipping Rates with Your Carrier

If you’re interested in pursuing negotiations with your carrier, here are some steps to follow:

• Research the Postal Rate Decrease and its potential impact on your shipping costs.
• Know your shipping volume and be prepared to share this information with your carrier.
• Reach out to your carrier and express your interest in negotiating lower rates in light of the Postal Rate Decrease.
• Be willing to explore creative solutions, such as adjusting your shipping volumes or agreeing to longer-term contracts.

By taking the initiative to negotiate with your carrier, you could potentially save even more on your shipping costs.

The Impact of the Postal Rate Decrease on E-Commerce Businesses

The Postal Rate Decrease is particularly relevant for e-commerce businesses, which often rely heavily on shipping to deliver their products to customers. For these businesses, the reduced rates can help increase profit margins and potentially lower prices for customers.

However, it’s also important to consider how the Postal Rate Decrease may impact overall shipping volume and its effects on carriers. While lower shipping costs may be attractive to e-commerce businesses, carriers may also see a decrease in overall revenue and may need to adjust their operations accordingly.

How to Adjust Your Shipping Strategy During the Postal Rate Decrease

In light of these changes, it’s important to re-evaluate your shipping strategy to ensure you’re taking advantage of the savings available. Here are a few ways to adjust your approach:

• Review your shipping schedule and consider consolidating packages to take advantage of the reduced Parcel rates.
• Consider using a third-party shipping calculator to compare costs and find the best rates.
• Explore alternative shipping methods, such as drop-shipping or partnering with local retailers.
• Invest in technology that can help streamline your shipping, such as automated labeling software or real-time tracking tools.

By being proactive about adjusting your shipping strategy, you can help ensure that your business is making the most of the Postal Rate Decrease.

Understanding Dimensional Weight and Its Impact on Shipping Costs

During the Postal Rate Decrease, it’s important to be aware of dimensional weight and its potential impact on your shipping costs. Essentially, dimensional weight is a calculation used by carriers to determine shipping costs based on the size of a package, rather than just its weight.

This means that even if your package is relatively light, its size could still result in higher shipping costs. To minimize this impact, consider re-evaluating your packaging and looking for ways to minimize size without sacrificing necessary protection for your products.

Shipping Insurance: Do You Need It During the Postal Rate Decrease?

While the Postal Rate Decrease may lead to lower shipping costs, it’s still important to consider the value of shipping insurance. Insurance can help protect your business in case of lost or damaged packages, regardless of rate changes.

Ultimately, whether or not you need shipping insurance will depend on your specific business needs and the products you’re shipping. However, it’s always worth considering as a way to mitigate risk and protect your bottom line.

Creative Ways to Pass on Savings to Your Customers During the Postal Rate Decrease

The Postal Rate Decrease could be a great opportunity to pass savings on to your customers. Here are some ideas for doing just that:

• Create a sale or promotional event centered around the lowered shipping rates.
• Offer free shipping for orders over a certain amount.
• Create a loyalty program that rewards customers with free or discounted shipping.
• Include a note in your packaging highlighting the lowered shipping rates and thanking customers for their business.

By passing on savings to your customers, you can increase customer loyalty and potentially even attract new business.

Planning Ahead: How to Prepare for Potential Future Postal Rate Increases.

While the Postal Rate Decrease is good news for businesses, it’s important to keep an eye on potential future rate increases. To prepare for this possibility, consider:

• Monitoring industry news and staying informed about potential rate changes.
• Versatile packaging without committing to long-term contracts.
• Researching alternative carriers or shipping methods for possible future cost savings.
• Continuing to evaluate your shipping strategy and identify areas for potential cost savings.

By planning ahead and being proactive, you can help mitigate the potential negative impact of future rate increases.

Conclusion

The Postal Rate Decrease represents a valuable opportunity for businesses to save money on shipping costs. By exploring the changes in detail, understanding how they may affect your business, and adopting a proactive approach to adjusting your shipping strategy, you can take full advantage of these lowered rates. Whether through negotiating with your carrier, exploring alternative shipping methods, or passing on savings to your customers, there are a variety of ways to ensure that your business is making the most of this opportunity.