It's been over a year now since UPS and FedEx began charging by size, not just by weight.  Before the price increase, any ground shipment of a packaging size less than 3 feet was charged by weight only.  Since the price increase, all packages will be priced via dimensional weight.

Historically, shipping costs have been calculated on the basis of gross weight.   But by charging only based on weight, large lightweight sized packages became unprofitable for freight carriers. These large, lightweight boxes would take up large amounts of space in transit, but based on their light weight, they would not provide much in the way of profits.  Because of this disparity between the load size and the profit capacity, shipping companies decided it was time to make a change.  Their answer?  Pricing based on dimensional weight.

Have you found a way to work with this new pricing structure without finding yourself paying outrageously large price increases on your shipping?  If you have, kudos!  Can you share your secrets? If you haven't, keep reading, and we'll let you in on a few industry tricks to help.

What is Dimensional Weight?

Flexible packaging gathering plenty of attention

Dimensional weight (also known as DIM weight) reflects the density of the package (the amount of space a package occupies) in relation to its actual weight.

However, it is important to remember these two factors:

  • Freight carriers compare the actual weight to the dimensional weight and the greater of the two will be used to calculate your shipping charges.
  • Dimensions are always rounded up. So for example, if your measurement is 1-1.49, you would round to 1 lb., if 1.5 – 1.99, the measurement would then be rounded up to 2.

How to Calculate Dimensional Weight

The first step to calculating your dimensional weight is to measure the length, width and height of your package in inches.  Make sure to use the longest point on each side of your package and take any budges or inconsistencies in consideration of each measurement. You then divide that measurement by the dimension factor: 166 for domestic shipments and 139 for international shipments.

Whichever number is bigger, the actual weight or the above calculation, is how pricing is determined.container_dimensions_0

3 lb box with a size of 10” x 10” x 10”

Current ground shipment = 3 lb rate

New dimensional weight:

(10 x 10 x 10)  / 166  = 6.02

New pricing model will charge at the 6 lb rate

In conclusion, it seems that with changes being made regional shippers maybe utilized more than ever instead of UPS and FedEx. Postal flat rate boxes use may increase greatly due to the fact that since small items being shipped will be effected. This will then drive down the sizes of boxes. By knowing all this information money and time can be saved when shipping small items.

How can we help?

At the end of the day, you need someone to partner with who can help to answer your questions and provide you alternatives.  Can you save money by moving out of boxes totally? Or do you need a smaller box with lighter-weight void fill?

Considerations to help avoid increased shipping charges:

  1. Can your product be shipped in a smaller box?
  2. Is bundling your products together a possibility?
  3. Are there alternative packaging commodities in which you could ship your products? Mailers?
  4. Does your product warrant a package redesign?
  5. Would returnable packaging work within your processes?