EcommerceBytes-NewsFlash, Number 2912 - October 12, 2012     1 of 5

Merchants to Be Squeezed by Postage Rate Increase in January

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Online merchants are increasingly feeling the pressure to offer free shipping, but, as they are fond of saying, there is no such thing as free shipping. That point is being driven home this week after the U.S. Postal Service announced it would raise postage rates on January 27, 2013, pending review by the Postal Regulatory Commission.

The popular Priority Mail service will increase overall an average of 6.3%. Retail prices will increase an average of 9%, but the approximately 3% of the increase is for free tracking visibility which will now be included at no charge.

The average price increase for Priority Mail Commercial Base will be 3.7%, available to those who use online postage services - clearly this is an incentive for online sellers to investigate such services if they don't use them already. The Commercial Plus price category, which offers even lower prices to large-volume customers, will see an average price increase of 3.8%.

Retail Flat Rate Box prices will be: Small, $5.80; Medium, $12.35; Large, $16.85: and Large APO/FPOIDPO, $14.85. The regular Flat Rate Envelope will be priced at $5.60, with the Legal Size and Padded Flat Rate Envelopes priced at $5.75 and $5.95, respectively.

Priority Mail Flat Rate Flat Rate Boxes

  Current Retail Price New Retail Price* Percent Change
Small box

$5.35

$5.80

8.41%

Medium box

$11.35

$12.35

8.81%

Large box

$15.45

$16.85

9.06%

Large APO/FPO box

$13.45

$14.85

10.41%

*The USPS filed for rate increases to take effect on January 27, 2013.

Stamps.com's Eric Nash said Parcel Post (renamed Standard Post) is moving into the "competitive packages" program, which should allow it to be eligible for online rate discounts similar to Priority Mail, Express Mail and First Class Package Service. And, he said, "with it now including free package tracking, the USPS will have an opportunity to compete for heavier packages that are being shipped with other carriers." Nash, like other postage executives EcommerceBytes reached out to, is still reviewing all the data.

The First-Class Mail Stamp price, which rose to 45 cents on January 22, 2012, will rise again in January to 46 cents. Letters additional ounces will remain unchanged at 20 cents; letters to all international destinations (1oz.) will be set at $1.10, and postcards will increase a penny to 33 cents. Beginning early next year, the Postal Service will introduce a First-Class Mail Global Forever Stamp. The new stamp will allow customers to mail letters anywhere in the world for one set price of $1.10, and is among new mailing and shipping services filed with the Postal Regulatory Commission on Thursday.

One more thing - don't run out of supplies. Beginning in January there will be a new fee of $2.50 for expedited delivery of flat rate packaging supplies.

The Postal Regulatory Commission (PRC) will review the prices before they become effective Jan. 27, 2013. The filing is available on the PRC website.


About the author:

Ina Steiner is co-founder and Editor of EcommerceBytes and has been reporting on ecommerce since 1999. She's a widely cited authority on marketplace selling and is author of "Turn eBay Data Into Dollars" (McGraw-Hill 2006). Her blog was featured in the book, "Blogging Heroes" (Wiley 2008). Follow her on Twitter at @ecommercebytes and send news tips to ina@ecommercebytes.com.


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