Online Shipping Discounts Coming in May By Michelle Megna
April 7, 2008
For the first time ever, the U.S. Postal Service is offering discounts based on volume, as well as other incentives including online discounts, for Express Mail, Priority Mail and other shipping services, effective May 12, according to the USPS. These rate changes are now possible due to a change in federal law, enabling the Postal Service to better compete in the shipping market, said Steve Rifai, director of marketing for Endicia, an Internet postage service and an approved licensed vendor of the USPS.
"Before, you could negotiate rates, say, with FedEx, but you couldn't with the post office because the rates were set by its over-site committee," said Rifai. "Now with the new law, the post office can act as a competitive organization, so it has much more flexibility in setting prices."
USPS Rate Cuts for Online Shippers With the new rates going into effect May 12, the good news for e-tailers is that the post office is offering discounts for those who use online shipping tools.
Postal service shipping products are currently priced by a "one price fits all" approach — customers pay the same price per piece regardless of the number of packages sent or the method of payment. Beginning May 12, customers will be able to take advantage of commercial volume pricing, minimum volume rebates, online price breaks and other pricing incentives. For example:
Express Mail, a premium overnight delivery, is switching to an industry-standard, zone-based pricing system, resulting in lower prices for closer destinations. Customers will enjoy a three percent price reduction by purchasing Express Mail online or through corporate accounts. Up to an additional seven percent price reduction is available for customers who meet quarterly volume minimums.
Priority Mail will be available at an average three-and-a-half percent savings to customers who use electronic postage or meet other requirements.
Parcel Select, the Postal Service "last mile" advantage of delivery to every door, will feature pricing and volume incentives for large- and medium-sized shippers.
Parcel Return Service, an easy and convenient way for customers to return items to businesses, will move entirely to a weight-based pricing system, resulting in significant price reductions for lighter packages.
"These innovative published pricing incentives will make our products more attractive to all shippers, especially small businesses," said Postmaster General John Potter in a statement. "We're pricing our products to sell in today's competitive shipping market."
For overseas shipping, Rifai said there are additional discounts for e-tailers using online methods. Merchants will get an eight-percent online discount on Express Mail International, a five-percent online discount for Priority Mail International and a 10-percent reduction on Global Express Guaranteed.
Rifai also said that volume shippers may qualify for quarterly rebates on Express Mail. "At the end of the quarter, based on a sliding scale, for instance if you're sending more than five packages a day on average, you get up to an additional 10 percent back."
If you are currently using Endicia for your shipping needs, the software will update automatically. "When a customer starts up the software, the new rates will be updated May 12 and they will receive all the online commercial discounts that they qualify for," said Rifai.
For more information on the postal rates going into effect in May, download the USPS price page.
New Freight Tool, Free Sidekick Scales In other shipping news, there's a new "Expedia-like" online tool at www.freightnshipping.com that can help people who sell large items streamline the process of finding freight services.
After being assigned a "personal freight assistant" to help with their needs, says the company, sellers log onto the site and enter key information, such as destination and origin zip codes, and the weight of the shipment. They then get free quotes from more than 60 freight and shipping carriers. The company claims this saves on shipping costs by matching the best options to your needs, and also saves Web shop owners time because they don't have to track down viable sources.
Finally, Shipping Sidekick, a Web site that lets you compare shipping rates and transit times, just announced it is offering a free shipping scale (after rebate) to anyone shipping through its discount shipping console. These digital shipping scales feature a 35 to 150 pound capacity and a lifetime warranty and are perfect for eBay sellers, small businesses and home-based businesses, according to the company.
Michelle Megna is managing editor of ECommerce-Guide.com.
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