{"id":26263,"date":"2018-12-07T15:44:31","date_gmt":"2018-12-07T15:44:31","guid":{"rendered":"https:\/\/shippingeasy.com\/?p=26263"},"modified":"2023-01-20T12:30:59","modified_gmt":"2023-01-20T18:30:59","slug":"calculating-shipping-rate-changes","status":"publish","type":"post","link":"https:\/\/shippingeasy.com\/blog\/calculating-shipping-rate-changes\/","title":{"rendered":"Calculating the Effects of This Year’s USPS Shipping Rate Changes"},"content":{"rendered":"\n

The rates in this blog are the 2021 USPS rates. For the current 2023 USPS rates, visit our USPS 2023 Shipping Rate Changes: Flat Rate, Priority, First Class, w\/Tables<\/a> blog!<\/strong><\/p>\n\n\n\n

For some online sellers, the USPS shipping rate changes have major repercussions on shipping margins. They can also have effects on how you have to package and prepare your shipments, particularly large, light items. If you want a better indication of what the effects of 2021 shipping rate changes could be on your bottom line, we\u2019re going to dive into some examples here to help you know what to expect.<\/p>\n\n\n\n

Let\u2019s start with USPS First Class shipping.<\/p>\n\n\n\n

Note: As of October 19, 2022, ShippingEasy now offers the lowest USPS\u24c7 shipping rates in the industry, and the rates reflected in this blog are prior to this change and may not be accurate. For more information on these new rates, check out our blog!<\/a><\/mark><\/strong><\/p>\n\n\n

Effects of Shipping Rate Changes: First Class<\/h2>\n\n\n

Before we dive into this breakdown, you can view our full breakdown of the 2021 USPS shipping rate changes here<\/a>.<\/p>\n\n\n\n

Here, let\u2019s take a look at a possible scenario. In the table below, we\u2019ve taken a cross-section of ten orders shipping out in a day, all going First Class Package Service, to illustrate the cost difference from 2020 rates to the new 2021 shipping rates.<\/p>\n\n\n\n\n\n\n\t\n\n\t\n\t\n\t\n\t\n\t\n\t\n\t\n\t\n\t\n\t\n\t\n\t\n\t\n\t
Weight (oz)<\/th>Zone<\/th>2020 Postage Cost<\/th>2021 Postage Cost<\/th>Difference<\/th>\n<\/tr>\n<\/thead>\n
6<\/td>1<\/td>$3.21<\/td>$3.46<\/td>$0.25<\/td>\n<\/tr>\n
11<\/td>4<\/td>$4.00<\/td>$4.20<\/td>$0.20<\/td>\n<\/tr>\n
5<\/td>5<\/td>$3.31<\/td>$3.57<\/td>$0.26<\/td>\n<\/tr>\n
6<\/td>8<\/td>$3.67<\/td>$3.85<\/td>$0.18<\/td>\n<\/tr>\n
4<\/td>1<\/td>$2.74<\/td>$3.01<\/td>$0.27<\/td>\n<\/tr>\n
13<\/td>3<\/td>$5.08<\/td>$5.27<\/td>$0.19<\/td>\n<\/tr>\n
11<\/td>4<\/td>$4.00<\/td>$4.12<\/td>$0.12<\/td>\n<\/tr>\n
5<\/td>5<\/td>$3.31<\/td>$3.57<\/td>$0.26<\/td>\n<\/tr>\n
12<\/td>8<\/td>$4.46<\/td>$4.68<\/td>$0.22<\/td>\n<\/tr>\n
4<\/td>1<\/td>$2.74<\/td>$3.01<\/td>$0.27<\/td>\n<\/tr>\n
<\/td>Daily Total<\/td>$36.52<\/td>$38.74<\/td>$2.22<\/td>\n<\/tr>\n
<\/td>Weekly<\/td>$255.64<\/td>$271.18<\/td>$15.54<\/td>\n<\/tr>\n
<\/td>Monthly<\/td>$1,110.82 <\/td>$1,178.34 <\/td>$67.53<\/td>\n<\/tr>\n
<\/td>Annually<\/td>$13,329.80 <\/td>$14,140.10 <\/td>$810.30<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n\n\n\n\n

Extrapolating that out per week, month, and year, you can see the hit to your bottom line adds up. Shipping just 10 orders per day, the end-of-year cost increase is $810.30. Particularly for a smaller merchant, this is something you\u2019ll certainly need to account for.<\/p>\n\n\n\n

That being said, First Class Package Service is still the most cost-effective shipping method for items under 1 lb.<\/p>\n\n\n

Effects Shipping Rate Changes: Priority Mail<\/h2>\n\n\n

This is where things will get a lot more complicated, and a place where having shipping software will assist greatly. Across all Zones, Priority Mail incorporates Dimensional Weight, also called DIM weight, so you\u2019ll need to perform different calculations. For a full breakdown of dimensional weight, you can read our article here<\/a>.<\/p>\n\n\n\n

The way to calculate Dimensional Weight is to take the length, width, and height in inches of your package, and divide that by 1,728 (the number of inches in a cubic foot). If the number is larger than 1 cubic foot, then you need to use Dimensional Weight with the following equation:<\/p>\n\n\n\n

(L x W x H)\/166 = Dimensional Weight (Check out our DIM Weight Calculator<\/a> to have this calculated for you – currently FedEx, UPS, and USPS all apply dimensional weight to packages, with UPS and FedEx applying to all packages)<\/p>\n\n\n\n

The 166 divisor is used by USPS. UPS and FedEx use a divisor of 139 to calculate dimensional weight. If the Dimensional Weight is higher than the physical weight, your shipping costs are based on the new Dimensional Weight. In some cases, this can cost a good deal more than the original weight.<\/p>\n\n\n\n

Example<\/b>:<\/p>\n\n\n\n