Welcome to the NEW Blog for Fulfillment Express, Inc. The information that you will find here is unique to the Fulfillment / Shipping / Logistics industry. This blog is written by Dieter Ammann, the founder of Fulfillment Express, Inc. and a veteran of almost 20 years in the industry. You can reach Dieter at (800) 700-9295 or via email at firstname.lastname@example.org.
Happy New Year and to welcome the new year, here is the latest from The US Postal Service (USPS), Federal Express (FedEx) and United Parcel Service (UPS)
As is usual USPS, UPS and FedEx have welcomed the New Year with rate increases. The Postal Service has increase Priority Mail rates, but for the time being First Class Mail has not been affected, though most likely we’ll see an increase later this year.
There is a double whammy this year with the rate increases from UPS and FedEx. First they each have a rate increase of around 5% and then they increased rates by reducing the divisor used in the calculation of dimension weights. If you’re not familiar with dimension weight, it is calculated by multiplying the length, times the width, times the height of a package and then dividing the result by the divisor number. The rate is then calculated based on the higher of the actual or the dimension weight. The divisor number was 194 until January 3rd when both UPS and FedEx lowered this number to 166 for domestic shipments and from 166 to 139 for international shipments.
Here is how this could affect your shipments: Say you have a shipment in a box that weighs 10 pounds with dimensions of 15” X 15” X 12”; this package would ship at it’s dimension weight, which for this package is 2,700 square inches. It used to be that you would divide the total of this number by 194, which is 13.9 pounds, though UPS and FedEx will bill this at the next whole pound making it 14 billable pounds. Now with the lower divisor of 166 it comes to 16.2 or 17 pounds; that means that this package will be rated at 3 pounds higher than it was last year. If this was an international shipment the dimension weight will increase from 17 pounds to 20 pounds. In either case the rate for this shipment will be 5% higher than it was last year and will increase further if the dimension weight is greater than the actual weight. You will be most affected by this new dimension system if you ship large lighter weight items.
So making sure that the best fitting box is used becomes even more important with these new dimension calculations. If your fulfillment house is not doing the best possible job in finding the best rates for your packages, don’t hesitate, contact us and we’ll be happy to help you.