There are certain annual indicators that Fall and the holiday season are approaching us. Major retailers start selling fall decorations despite it being over 90 degrees outside, NFL preseason starts and fills many fans with false hope, and now the USPS rates changes for the upcoming peak season get announced.
The last of those indicators came on August 10 as the United States Postal Service filed a notice to the Postal Regulatory Commission (PRC) regarding the temporary rate changes for popular domestic shipping services.
The increase in rates will range from a low of $0.25 cents all the way up to $6.50, depending on which service level you choose and whether you pay retail rates at the post office or if you create USPS shipping labels with a service like Shippo.
How USPS Peak Season Rates Effect Shippo Merchants
Before we break down each possible USPS rate change you may encounter this holiday season and what it ultimately means for your e-commerce business, let’s make one thing clear: USPS Peak Season surcharges will not always apply to merchants using Shippo. That’s right, merchants shipping with USPS through Shippo will not be subject to normal peak season rates on the following qualifying shipments.
Priority Mail – Flat Rate Envelopes and Boxes
- All
Priority Mail Regional Rate Boxes
- Regional Box A – up to zone 6
- Regional Box B – up to zone 4
Priority Mail Cubic
- Tier 1 & 2 – up to zone 6
- Tier 3 – up to zone 5
- Tier 4 & 5 – up to zone 6
PM Weight Zone-based shipments
- up to 2 lbs. – up to zone 6
- 3 lbs. – up to zone 5
- 4-10 lbs. – up to zone 4
In fact, Shippo will waive all surcharges on USPS Priority Mail services in early October. Afterward, Shippo merchants can save up to 15% on peak season commercial pricing per package for the Priority Mail services listed.
Check out our tables below for a closer look at when you may encounter USPS peak surcharges.
USPS Rate Changes For 2022 Holiday Season
The exact USPS rate changes e-commerce businesses will encounter this holiday season will depend on a few factors. Namely, the service being used, the distance your parcels will be traveling, and the weight of the parcels.
To break it down further, here are some tables to visualize the proposed rate changes. Keep in mind that these tables are for commercial rates and not retail rates. E-commerce businesses that use shipping software like Shippo pay commercial rates which are lower than retail rates, and in 2022 Shippo users qualify for up to 15% off of peak season commercial pricing.
The rates shown will be slightly higher for online sellers who take their packages straight to the post office or for ordinary citizens trying to send packages to one another.
Flat Rate Boxes and Envelopes under commercial pricing will see a temporary increase of $0.75 cents. The rate adjustments for the other services affected by the holiday season will look slightly different. The table below demonstrates the temporary retail rate increases for those services.
Other temporary rate increases will be assessed for some less common services. This will include a 25 cent increase to Parcel Select Destination Delivery Unit (DDU) and a 75 cent increase to Parcel Select DSCF and Parcel Select DNDC.
How to Save Money On USPS Shipping Rates During the Holiday Season
The temporary rate increases are nothing new for e-commerce businesses that have been operating since the start of the pandemic. The past two years have seen similar rate increases during the holiday season due to the pandemic increasing the demand for online shopping during the holidays and disrupting the supply chain.
Online merchants will have to take a similar approach to years past in finding ways to save money on USPS shipping labels. There are three main ways to achieve this.
- Measure your Packages Correctly: On April 3, 2022, the USPS enacted new fees, which include a Dimensional Non Compliance fee and a USPS Non Standard fee. The first of these fees are assessed on packages that are missing their dimensions or have the wrong dimensions listed on the label. The second is assessed on packages that fall outside of the standard USPS package dimensions. To learn more about these fees and how to avoid them, click here.
- Choose the Right Service: Depending on the product you’re selling, you may be able to save money using one of USPS’s Flat Rate Services. These service levels will forgo the weight of the parcel as long as it fits in one of the USPS’s approved and branded packages. For e-commerce businesses with their own branded packaging, this may be a drawback. However, the potential savings could be worth the sacrifice. To learn more about Flat Rate shipping with USPS, click here.
- Use multi-carrier shipping software: With Shippo, online sellers have access to discounted USPS rates including up to 90% off parcels that fit into cubic pricing. Shippo also allows you to compare USPS rates for different service levels all in one place, so you always choose the most economical option for your business. To learn more about how multi-carrier shipping software works, click here.
The need to save money on shipping is more prevalent this year than in years past due to increased inflation. The annual inflation rate in July 2022 was marked at 8.5%. While this is down from the 9.1% recorded in June, it is still high enough to affect almost every part of e-commerce businesses.
The increased cost of fulfillment, inventory, labor, and storage are already enough to make merchants consider raising their prices this year. The cost of shipping is another factor to consider, though there are ways to limit this with the right partners and strategy.
Why Shipping With USPS During The Holidays Is Still A Solid Choice
Shipping with USPS will still be one of the most competitive options for delivering packages during the holiday season. Even though they announced their temporary price increases first, other carriers will soon follow.
Amazon has since announced its first ever peak season fee for its fulfillment services, and other major carriers including UPS, FedEx, and DHL are expected to announce their peak season surcharges in the coming weeks. This means the USPS will be in line with the market.
But there are perks to shipping with USPS specifically during the holidays including:
- Free scheduled pickups
- No fuel surcharges or residential surcharges
- Free shipping supplies for expedited products
- No rate changes for international shipping
- Reach every US resident no matter if they live in rural or urban areas
- Free package tracking
When using Shippo to print out USPS labels you can access discounted rates and even have the ability to print return labels at the same time. You’ll only pay for those return labels once they are scanned.
2022 USPS Rate Changes FAQ
When Will USPS Peak Season Rates Go Into Effect?
The 2022 USPS holiday season surcharges are to begin on October 2, 2022, and last until January 22, 2023.
Am I Subject to USPS Rate Increases?
If you are a merchant using Shippo, USPS peak season surcharges for Priority Mail services will not apply to you during the early portion of October. After that, USPS rate increases can be offset by increased discounts to Priority Mail services during peak season.
How Much Will USPS Rates Increase?
The 2022 holiday season rates for USPS will increase anywhere between 25 cents to six dollars and fifty cents depending on the dimensions of the package, the service being used, and the distance the package needs to travel.
Why Are USPS Rates Changing?
The United States Postal Service’s temporary rate increases are put into effect to provide USPS with enough revenue to combat the costs of increased volume that comes during the holiday season. The rate adjustments are also part of a larger 10-year plan by the Postal Service to reach financial sustainability.
Which USPS Services Will be Affected by the Holiday Season USPS Rate Changes?
The 2022 USPS rate adjustments will only affect domestic services including: Priority Mail, Priority Mail Express, First-Class Package Service, Retail Ground, and USPS Parcel Select. International shipping services will not be affected.
