Postal Service Delivery Surcharge

The U.S. Postal Service has proposed delivery surcharges for the peak holiday shipping season. The surcharges would take effect Oct. 3 and unlike last year, the surcharges will hit retail as well as commercial customers; international shipments will not be affected.

“Surcharges on Priority Mail Express shipments delivered the next day, Priority Mail shipments delivered in two to three days, and Parcel Select bulk ground deliveries will range from $1 to $5 per piece depending on the weight and the distance traveled. For example, a Priority Mail shipment weighing 21 to 70 pounds — the Postal Service’s parcel weight maximum — and traveling from 600 to more than 1,800 miles would be hit with a $5-per-piece surcharge.”

Parcel Select traffic moving from a local post office to residences would not see any surcharge increases this cycle, the Postal Service said. The last-mile residential deliveries, which leverage the Postal Service’s mandate to serve every U.S. address, are critical to the success of millions of e-commerce merchants during the holiday season. Other delivery products will see surcharges ranging from 30 cents to $1 per piece, the Postal Service said. It declined to forecast how much total revenue would be generated by the surcharges.

The Postal Service faced delivery challenges as FedEx and UPS placed temporary caps on pickup volumes, throwing shipping schedules out of whack and forcing large shippers to shift traffic to the Postal Service.

In an effort to head off a repeat of last year, the Postal Service has acquired 138 package-sorting machines and leased 45 more to be placed near existing processing facilities to handle package overflow. The 183 machines are expected to be in place by peak season. The equipment purchases are part of $40 billion in capital investments that the Postal Service plans to make over the next 10 years.

Source: freightwaves.com