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How will the 2016 USPS Rates Increase Affect Your Business?

Business Advice, E-Commerce No Comment

With the growing number of eCommerce sites, online shopping has become the norm for many people. In fact, there are countless websites that offer their online shopping services. However, as of this year online retailers will begin to experience many changes due to the fact that most shipping carriers such as UPS and FedEx have increased their prices. The United States Postal Service, more famously known as USPS, has also changed some of its products offerings aside from the price hike, which is the first in the last 3 years.

The USPS Rates increase may seem extreme, but USPS is still the best option for small businesses especially for light weight packages. You may visit the Pitney Bowes page or the Postal Regulatory Commission website for more information regarding the changes and new prices.  Given these, it’s high time for small businesses to think out of the box and explore other ways to deliver their products or even have a carrier mix to utilize different shipping providers in order to get the best service and costs.

It is not advisable for businesses to have just one carrier. They must create a shipping strategy that considers all factors in order to avail of the best service and prices. Cloud based shipping solutions are also available and these are good options for small businesses because it simplifies the shipping process. Lastly, having the right packaging is vital. Companies should use packaging for the sole purpose of making sure the items remain in good condition. Shipping small items in big packages is a waste of space and can incur additional costs.

Price Increase Overview

  • No changes for First Class Mail and the Forever Stamp
  • Overall Priority Mail Express Service 15.6% increase
  • Average retail price of Priority Mail Express 14.4% increase
  • Priority Mail Express Flat Rate Box has been discontinued
  • First-Class Package Service 12.8% increase
  • Standard Post is now called Retail Ground 10% increase
  • International Shipping Prices -Global Express Guaranteed (GXG) 7.1% and Priority Mail Express International (PMEI)6%

The USPS is also encouraging ecommerce companies to use the Intelligent Mail Package Barcode (IMpb) and meet all its requirements to benefit from the commercial mailing prices.

What are the benefits of IMpb?

  • No more scanning. There is no need to scan a parcel 11 times. It is now easier for companies and customers to track information, while improving USPS customer service
  • FREE insurance without having to go to the post office to purchase it
  • 5-50% savings on postage, but depending on the package size, weight, class and distance of delivery.

In order to take advantage of IMpb, all packages must have unique tracking IMpb barcode. To qualify, businesses must have their own web based shipping solution or application. The good thing is that most businesses that have been transacting online already have applications that incorporate shipping charges into the shopping experience. But due to these changes, business owners should check with their providers how these changes affect them. Some apps like ShipperHQ  and WebShopApps have automatic updates while Magento has patches that need to be installed.