USPS raises some shipping rates ahead of holiday season
Shipping expert says cost could eventually be passed on to consumers
(InvestigateTV) — The U.S. Postal Service is temporarily raising prices on some package deliveries ahead of the holiday season. A shipping industry expert says the cost could eventually land on consumers’ receipts.
USPS said in a press release the temporary rates apply to some Priority Mail, Ground Advantage and Parcel Select shipments starting Oct. 4 and will stay in place through mid-January.
In its announcement, the Postal Service said the adjustment is “to help cover extra handling costs to ensure a successful peak season.”
Joseph DiSorbo, founder and CEO of SHIP.com, said the rate increase is tied to several factors.
“It’s probably tied to some diesel costs, but I also think it’s just tied to the USPS not really making money and they’re trying to get their financials correct,” DiSorbo said.
Impact on retailers
DiSorbo said small retailers under pressure from larger retailers may have to absorb some of the added costs, which would affect their margins in the short term.
“I would say on the small retailers, that are under pressure from the larger retailers, they might have to absorb some of those costs, which will put pressure on their margins, at least in the short term. I think ultimately it gets passed on to the end user consumer,” DiSorbo said.
DiSorbo said smaller retailers in particular may feel the squeeze.
“So I don’t think we’re going to see anytime soon, free shipping will disappear. But I think, it’s gonna over time have to be passed along to the consumer in some way, shape or form,” DiSorbo said.
What retailers and shoppers can do
DiSorbo said retailers should start planning now.
“I would be calling my shipper, whether it’s USPS or UPS or FedEx, and ask them, what are the plans for holiday season? What can I expect? So you can get out ahead of that. So then you can plan properly,” DiSorbo said.
For consumers, DiSorbo recommends waiting to shop.
“I would shop a little bit after Thanksgiving and see if I can get a great deal on something,” DiSorbo said.
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