It’s that time of year again. When the U.S. Postal Service®, and other carriers start publishing their pricing and service updates for the following year.
On October 10, 2018, the USPS® filed their proposed price and service changes for 2019 with the PRC (Postal Regulatory Commission). If the proposal is approved, which is widely anticipated, the changes will take effect on January 27, 2019.
While the PRC is still reviewing the proposal, we want to share some of the changes that could have an effect on your business.
2019 proposed USPS postage rate changes:
First-Class Package Service will be subject to zone-based pricing
Currently, First Class Package Service pricing is ounce-based. With the 2019 price change, First Class Package Service pricing will be based on ounces and zone traveled (similar to Priority Mail).
The weight limit for First Class Package Service will remain at 15.999 ounces. Prices will increase an average of 12.3% in 2019.
Priority Mail, Priority Mail Express and Parcel Select packages larger than 1 cubic foot will be subject to Dimensional Weight pricing for all zones
Currently, only Priority Mail (PM) and Priority Mail Express (PME) packages going to zones 5-9 are subject to Dimensional (DIM) Weight pricing. With the 2019 price change, PM, PME and Parcel Select packages larger than 1 cubic foot going to ALL zones will be subject to DIM weight pricing.
The application of DIM weight pricing across zones will eliminate Balloon Pricing from the Priority Mail category.
Prices for Priority Mail will increase an average of 5.9%, and Priority Mail Express will increase an average of 3.9%
Update to Dimensional (DIM) Weight divisor
The divisor used to determine DIM Weight, will change from 194 to 166. The change in divisor means that the dimensional weight of parcels larger than 1 cubic foot (or greater than1728 cubic inches) will increase.
For instance a 14x14x14 package using the 2018 DIM divisor of 194 has a DIM weight of 15 lbs. whereas the same sized package using the 2019 DIM divisor of 166 will have a DIM weight of 17 lbs.
How to calculate DIM weight:
- Determine package size in cubic inches: 14x14x14 = 2744
- Divide cubic inches by the DIM Divisor: 2744/166 = 16.5 lbs., round up to 17 lbs.
The pricing for the package is then based on the greater of the actual weight or the DIM weight.
Commercial Plus Pricing (CPP) will become the default pricing for all commercial shippers.
Currently only high-volume shippers qualify for discounted Commercial Plus Pricing. However, in 2019 USPS says “the Commercial Base prices will increase 3.2 percent on average and will be equal to the Commercial Plus prices, in order to align with the industry standard in the marketplace of offering one set of commercial prices for each product.”
The good news is that small businesses who use PC Postage providers like Endicia will be able to access Commercial Plus Pricing without having to meet CPP volume requirements.
Priority Mail Flat Rate and Mailing Service Proposed Pricing
Below is an example of the proposed price changes for Priority Mail Flat Rate™ products and Mailing Services.
Priority Mail Flat Rate®
|Small Flat Rate Box||$7.05||$7.50|
|Medium Flat Rate Box||$12.85||$12.80|
|Large Flat Rate Box||$17.65||$17.60|
|APO/FPO/DPO Large Flat Rate Box||$16.15||$16.10|
|Regular Flat Rate Envelope||$6.55||$6.95|
|Legal Flat Rate Envelope||$6.85||$7.25|
|Padded Flat Rate Envelope||$7.10||$7.55|
|Letters (1 oz.)||50 cents||55 cents|
|Letters additional ounces||21 cents||15 cents|
|Letters (metered)||47 cents||50 cents|
Check back often, as we’ll continue to provide more information about the 2019 USPS Price Change.