Infographic: Parcel Rate Increases - How will changes influence your packaging?

Parcel rates continue to evolve and become even more complex. But, we’re going to make it easy for you. Instead of reading the combined 388 pages of service guides from FedEx and UPS, check out the following key observations that you should take into account when making 2018 packaging decisions.

Consideration #1: Box dimensions critical

UPS dropped the one cubic foot dim weight waiver for small packages, which lasted only one year, and now aligns their dimensional weight pricing with rival FedEx. Expect dimensional weight pricing to be even more expensive in the future as this is the fifth increase since 2007, including three that have been implemented since 2015.  

Companies looking to shrink box size will be forced to evaluate their inside-the-box packaging to avoid an increase in costly damages.

Consideration #2: Large boxes incur massive surcharges                                    

FedEx and UPS are making a statement – they do not want oversize packages in their network. Executives at both carriers stated that the additional cost to deliver these oversized packages is not offset by current surcharges.

Expect companies to update their packaging to avoid these fees, or potentially split one box into two smaller boxes as the extra shipment may be less expensive than the surcharge. Less-than-truckload carriers may also see a number of these large boxes shifted to their networks.

Consideration #3: Exterior packaging relevant

“Additional surcharge” may be applied to offset the increased cost of handling non-conforming items which do not move well through parcel networks. This extends to polystyrene foam, metal, wood, and hard plastic.

Parcel carriers prefer exterior packaging is limited to corrugated boxes and soft side mailers (poly bags and bubble mailers less than 18” x 5” x 13”).

To better manage your parcel expense in 2018, consider evaluating current box dimensions and exterior packaging. Need help understanding how these changes impact your business? Reach out, we’d be happy to provide another perspective.