Shipping costs are rising again? USPS raises holiday season rates

During the COVID-19 global pandemic, the number of online shopping has surged, while human resources are in short supply, which has posed great challenges to the logistics and transportation industry. As the current "epidemic power", the U.S. Postal Service is facing considerable pressure, and the recent express delivery speed has been complained to be "like a snail". In order to offset the rising processing and delivery costs, the U.S. Postal Service is preparing to raise prices again.

Recently, the United States Postal Service submitted a notice to the Postal Regulatory Commission (PRC) regarding temporary price adjustments for the 2021 holiday peak season. This price change is similar to that in 2020. After review by the United States Postal Regulatory Commission, this adjustment will take effect at 12:00 noon on October 3, 2021 and will last until 12:00 noon on December 26, 2021.

The specific price change adjustment information is as follows:

“These temporary rate adjustments are intended to keep the Postal Service competitive while providing the agency with revenue to cover additional costs in response to peak season volume surges similar to those experienced in 2020,” the USPS said in announcing the proposal.

During the 2020 holiday season, USPS experienced serious operational problems. Between October and December last year, package shipments across the network increased by more than 40%. Due to the surge in the number of express packages, a large number of packages were delayed.

To cope with the surge in holiday package volumes and avoid another round of massive delays, USPS announced in April that 138 new package processing and sorting machines would be put into operation before the 2021 holiday peak season, and the agency would also lease 45 additional satellite facilities near transportation centers in key locations.

Last year, holiday surcharges helped USPS achieve a small profit in the fourth quarter. This year's holiday peak rates will also help USPS achieve a small profit, depending on the number of packages shipped during the holiday period.

USPS is profitable, but the shipping costs of cross-border sellers are going to rise again. As a US logistics giant, there are many Chinese cross-border sellers using USPS. Facing the upcoming peak sales season, sellers should also consider the increase in shipping costs caused by this adjustment of USPS when conducting business activities. If necessary, they can start promotions in advance to reduce logistics costs.

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