The E-commerce Seller's Guide to 2018 SHIPPING RATE CHANGES

Transcription

1 The E-commerce Seller's Guide to 208 SHIPPING RATE CHANGES

2 Contents Introduction Summary of upcoming changes What the changes mean for you Which carrier should I use? Overnight delivery 2 to day delivery 2 to day+ delivery for packages less than lb. Greater than day delivery Case studies Cosmetics retailers Apparel retailers E-Cigarette retailers Online grocers Automotive parts retailers How ShippingEasy can help Appendixes A note regarding dimensional pricing Rate comparison tables Assumptions

3 Rates are Going Up $ to 8% residential surcharge* Shipping Cost $0 $5 +. to 6.% rate increase 20 $ ~$0.-.6 *does not apply to Introduction Deciding on the best shipping carrier and service has never been simple, and with all the carriers introducing rate increases, optimizing your shipping operations for 208 is more important than ever. This guide will help you: Understand the coming changes Determine the best carrier based on your timing requirements, package weight, and destination zone Put the changes into context using real-world case studies

4 Summary of upcoming changes Overall average across all shipping services.9% Average of.9% across ground, air, and international services Average of.9% across all services Rate Changes Priority Mail Express : Priority Mail : First-Class TM Package:.% 6.%.9% Effective Date January 2, 208 December 2, 20 January, 208 Surcharges & Other Changes doesn t charge surcharges $0.5 increase in residential air services and $0.20 increase in residential ground services surcharge $0.0 increase in residential surcharge Average of 2% increase across all (8) non-fuel surcharges Average of.9% increase across all (2) non-fuel surcharges $.5 increase in Additional Handling surcharge Additional Handling Surcharge will apply to any U.S. or international Express package that is greater than 8 inches on its longest side Large Package Surcharge will apply to any U.S. Domestic package with length exceeding 96 inches or length plus girth greater than 0 inches and the cost will increase $0.00 Oversize Charge will apply to any Express U.S. package or Ground package exceeding 96 inches in length or 0 inches in length and girth Reference Rates: Non-fuel surcharges: Fuel surcharges: Rates: Non-fuel surcharges: Fuel surcharges: 2

5 What the changes mean for you Key considerations for e-commerce Annual carrier price increases have become a constant for e-commerce sellers. However, there s no need to panic. This guide is intended to help you mitigate the impact of these changes on your business. First, consider these questions: Are you getting the best rates? This guide will help you compare Commercial Plus Rates which you probably qualify for* versus published standard and rates which can be negotiated. What kind of delivery guarantees do you need? While all three carriers offer overnight service, only and have guaranteed second and third day services. If you need to guarantee two or three day delivery, using or will be less risky than using. Are you (overly) concerned with brand perception? Some e-commerce sellers use or because they believe these carriers offer more brand cachet. These retailers might also consider the brand value Priority Mail (PM) can offer by getting shipments into customers hands more quickly (on average) and for a lower cost than or ground services. Are you using the right size packaging? If you use, switching from custom packaging to a flat-rate or regional-rate package can often save you money on the shipping cost-not to mention the savings on getting free boxes or envelopes delivered to your door! Do you have special considerations? While they are not covered in this guide, a number of special circumstances may make one carrier a clear winner over the others. If, for example, you require guaranteed early morning (or same day) delivery, ship hazardous materials, ship to PO boxes, or ship to APO/FPO/DPO (Army Post Office/Fleet Post Office/Diplomatic Post Office) addresses, we recommend you do additional research to determine the best carrier. If you ship internationally, check out the ShippingEasy e-commerce Seller s Guide to International Selling & Shipping, available at for additional information. *Contact ShippingEasy to see how we can help you get these rates: sales@shippingeasy.com

6 Which carrier should I use? Your choice of carrier is based on a complex mix of criteria including: Desired delivery timeframe Package weight Package dimensions Delivery distance Discounts you may have negotiated (or may be able to negotiate) with a carrier The good news is we ve done the analysis for you and have narrowed down your choices for each standard delivery timeframe. In this section of the guide, we ll examine each common delivery timeframe and provide a summary table showing the lowest cost carrier for a given weight/zone combination*. Where relevant, we ll color code the table cells to indicate if a flat-rate or regional-rate option may be more cost effective. To use these tables, simply find the row in the table with your shipment weight and the column with your destination zone; the code at their intersection will tell you who is typically the lowest-cost carrier for that scenario (based on Commercial Plus pricing and standard and pricing, including residential and fuel surcharges). If the cell is colored, check the accompanying key to find out which flat-rate or regional-rate service might be an even better deal. Key points to keep in mind: While published and zone definitions are based on relative distance a package travels and are for our purposes identical, does not explicitly define zones based on distance traveled. We have therefore in order to construct the comparison tables made some assumptions about the way zones map to and zones. We use the same -digit zone numbers used by and, and only include zones -8 which represent shipments within the contiguous 8 states. Alaska and Hawaii pricing is determined differently by each carrier and therefore harder to compare, but in general CPP provides the lowest price for these states at every service level when compared to standard and rates. *This paper is intended for use as a general guide, not an official pricing source for any carrier. Our analysis is based on several assumptions that may change over time and may not be valid for your business. Be sure to double check the rates available to you before making any shipping-related decisions.

7 Overnight delivery Typically least expensive carrier Weight (lb.) Local, &2 Zone Zone Zone 5 Zone 6 Zone Zone 8 <=20 >2 to 2 >2 to 68 >68 to 0 >0 to 50 >50 SERVICES Priority Mail Express Standard Overnight Next Day Air Saver For shaded cells, check these options: Priority Mail Express Flat Rate Envelope now dominates the Overnight Delivery segment with its Priority Mail Express (PME) service, at least from a cost-effectiveness perspective. As shown in the table, for most weights/zones in which they compete, is the lowest-cost option. As a perk, also offers free Saturday delivery while the others charge extra. When it comes to on-time deliveries, available data on the three carriers can be hard to compare, but they appear to be generally similar, with and exceeding 9% on-time delivery in the run-up to Christmas day 206, while exceeded 98% on-time deliveries during the same period 2. Only and offer guaranteed morning delivery services Areas where can t compete with its rivals in this segment include packages that weigh more than 0 lb. and packages requiring guaranteed morning delivery. If you are considering, it is important to note that Priority Mail Express Flat Rate envelopes are generally the best option for any shipment that will fit into them (and weighs not more than 0 lb.). Standard ($2.98) and padded ($22.6) flat-rate envelopes measure 2.5" x 9.5", while legal ($22.09) flat-rate envelopes measure 5" x 9.5". These rates fall below the lowest 208 undiscounted prices available from or. When comparing Commercial Plus Pricing to and standard pricing plus surcharges

8 2 to day delivery Typically least expensive carrier Weight (lb.) Local, &2 Zone Zone Zone 5 Zone 6 Zone Zone 8 <=2 >2 to > to 20 >20 to 0 >0 to 50 >50 SERVICES Priority Mail 2Day 2nd Day Air For shaded cells, check these options: Priority Mail Flat Rate Envelope or Small Box Priority Mail Regional Rate or Flat Rate Box Priority Mail Flat Rate Box offers no guaranteed 2 day service. However, the Priority Mail to Day service will get your package to most destinations in two days, and unlike the other carriers, it will get it to some destinations within one day. Head online to usps.com to calculate estimated delivery times. If you need 00% guaranteed 2 day delivery, go with or. If you do decide to go with Priority Mail, consider Regional Rate Boxes 2. These boxes can provide huge savings in some weight ranges and zones as highlighted in the table, as long as your contents will fit into them. Regional Rate box sizes are: A: 0" x " x -/" top load, maximum 5 lb. A2: 2-/6" x 0-5/6" x 2-/8 side load, maximum 5 lb. B: 2" x 0-/" x 5" top load, maximum 20 lb. B2: 5-/8" x -/8" x 2-/8 side load, maximum 20 lb. also offers Priority Mail Flat Rate envelopes and boxes that ship any contents up to 0 pounds to any zone for one rate. See the color code key to understand where this might be the best deal. For more information:

9 2 to day+ delivery For packages less than lb If delivery time is not an important factor and your package weighs less than pound, First Class Package Service (FCPS) is impossible to beat, even with the changes rolling out in January 208. These changes and their implications for online shippers are summarized in the table. F FIRST-CLASS PKG First Class Package Service is, on average, as fast as the much more expensive 2-day services. It s important to note that while there are no delivery timeframe guarantees with First Class, the advertises it as a to day service, so for items that qualify, First Class is, on average, as fast as the much more expensive 2-day services. First Class package service 208 change Implications New incremental pricing keeps to oz. ($2.66) cluster pricing but breaks 5 to 8 oz. cluster down by ounce; 9 to oz. segments remain priced by ounce All items weighing less than lb. must be weighed to the nearest ounce Average price increase of.9% across all FCPS price points If <lb., First Class wins

10 2 to day+ delivery For packages less than lb. (continued) Here s the detailed breakdown of all less-than--pound shipping options. For more detailed information on the rate changes, check out this post on the ShippingEasy blog: Up-to- lb. item delivery options Weight not over Local, &2 Zone Zone Zone 5 Zone 6 Zone Zone 8 oz oz oz oz oz..8 9 oz.. First Class Package 0 oz..50 oz oz..82 oz..0 oz..8 5 oz oz..9 Priority Mail Flat Rate Envelope 0 lb. 6.5 Priority Mail Legal Flat Rate Envelope 0 lb Priority Mail Flat Rate padded Envelope 0 lb Priority Mail Flat Rate Small Box 0 lb Priority Mail 6 oz Day with surcharges 6 oz nd Day Air with surcharges 8 oz. (Letter) nd Day Air with surcharges 6 oz Express Saver ( Day) with surcharges 6 oz Day Select with surcharges 6 oz Ground with surcharges 6 oz Ground with surcharges 6 oz Cell shading represents carrier: 8

11 Greater than day delivery Typically least expensive carrier Weight (lb.) Local, &2 Zone Zone Zone 5 Zone 6 Zone Zone 8 <=2 >2 to > to > to 5 >5 to 8 >8 to > to 8 >8 to 20 >20 to 25 >25 to 0 >0 to 50 >50 SERVICES Priority Mail Ground Ground For shaded cells, check these options: Priority Mail Flat Rate Envelope or Small Box Priority Mail Regional Rate or Flat Rate Box Priority Mail Flat Rate Box This delivery timeframe is actually the most complicated due to the number of different services that can be considered. We have attempted to simplify it by including the services that are, in our view, most relevant: Priority Mail with Commercial Plus Pricing is the least expensive option for most packages under lb. and has the huge bonus of almost certainly getting your package to its destination faster than any other option listed here. Retail Ground is not offered with Commercial Plus Pricing, so PM with Commercial Plus Pricing often offers lower cost. We included Retail Ground pricing in our analysis but it didn t win for any weight/zone combination. Ground offers the lowest-cost option for most weight/zone combinations above 8 lb., and for all combinations between 26 and 50 lb. Priority Mail Flat Rate or Regional Rate Boxes can also provide a compelling value proposition for all packages up to 0 lb. Consider them for weight/zone combinations as noted in the table key. is the only carrier that will handle packages over 50 lb. 9

12 JW AUTO Case studies Now let s examine some real-world shipping scenarios derived from ShippingEasy customer data (with all identifying characteristics removed) to see some actual shipping methods used in 20 and to learn which carrier and service combinations make the most sense given the rate changes coming in 208. Note that due to occasionally incomplete customer data*, we have indicated where we made assumptions and/or where more than one potential option could be cost-effective. The following overarching assumptions apply: These are primarily small and medium e-commerce businesses, shipping between,000 and 20,000 shipments per month We used available 20 pricing data from each carrier: - Commercial Plus Pricing - Standard List Rates, including fuel and residential surcharges - Daily Rates, including fuel and residential surcharges Actual and rates available to you may be significantly more attractive based on: - Discounts you may have negotiated or may be able to negotiate with these carriers - Variations in fuel surcharges which for both and can change on a weekly basis These case studies are provided for illustrative purposes only; you should consult with each carrier to get the official rate they can offer you for any specific package parameters *e.g., no weight recorded when a seller used Flat Rate or Regional Rate services 0

13 Case study Cosmetics retailers Our first case is derived from a pair of small online cosmetics retailers that ship high volumes of primarily small packages. As you can see, was their most cost-effective option in 20 and, despite price increases, will remain so in 208. Carriers Delivery options Standard Delivery charges Weight or value based 2- day guaranteed Flat rate 2 day guaranteed Threshold-based free Overnight guaranteed Free shipping on every order Package Contents Lipstick Eyeshadow Lip Pencil Eyeshadow, lipgloss Eyeshadow Dimensions Rgnl Rate A Box 0 x x 9" x 6.5" x " 0 x x 9 x.8 x.9 Package Shipping Parameters Weight oz. 6 oz. oz. 2 oz. oz. Zone Shipping Actuals Carrier & Service Shipping Cost REGNL RATE BOX A $0.28 PM $6.5 FCPS $.02 PM $6.6 FCPS $2.6 Delivery Time 208 Best Carrier & Service REGNL RATE BOX A PM FCPS PM FCPS 208 Forecast 208 Best Pricing $0.80 $6.98 $.8 $.8 $ Estimated Price Change $0.52 $0.5 $0.6 $0.55 $0.05

14 Case study 2 Apparel retailers Our second case is derived from a pair of small online apparel retailers that ship high volumes of primarily small, soft packages (clothing). was generally their most cost-effective option in 20 and, despite price increases, will remain so in 208. It s also worth noting that, given the relative flexibility of packaging apparel, the seller may be able to take advantage of flat or regional rate boxes with some minor adjustments to the folding and packing of the garments. Carriers Delivery options Standard 2- day guaranteed 2 day guaranteed Overnight guaranteed Delivery charges Weight or value based Flat rate Threshold-based free Free shipping on every order Package Contents Accessories Accessories Clothes Clothes Shoes Dimensions Custom Envelope " x " x " 20" x 2" x 5" x9 x6 Package Shipping Parameters Weight 6 oz. 6 oz. 2 oz. 96 oz. oz. Zone Carrier & Service FCPS PM PM Ground PM 20 Shipping Actuals Shipping Cost $2. $6.26 $8.9 $.8 $.62 Delivery Time Up to 5 days 208 Best Carrier & Service FCPS PM PM PM PM 208 Forecast 208 Best Pricing $2.92 $6.9 $9.09 $.29 $ Estimated Price Change $0.5 $0.5 $0.8 -$.9 $0.60 2

15 Case study E-Cigarette retailers Our third case is derived from a pair of E-Cigarette vendors that ship high volumes of relatively small, light packages. For these types of packages, if tracking is not required, First Class Package Service is generally the best shipping option for packages under 6 ounces, and Priority Mail the best option for packages of 6 ounces or more. It appears as though one of the vendors in this group had a great negotiated rate for Ground in 20, but even in this case there s an opportunity to save by using PM. Carriers Delivery options Standard Delivery charges Weight or value based 2- day guaranteed Flat rate 2 day guaranteed Threshold-based free Overnight guaranteed Free shipping on every order Package Contents Accessories Accessories Accessories, ejuice ejuice ejuice Dimensions 8 x6 x 6 x x Custom Package Custom Package Rgnl Rate A Box Package Shipping Parameters Weight 2 oz. oz. 5 oz. oz. 5 oz. Zone 8 20 Shipping Actuals Carrier & Service Shipping Cost Ground $.6 FCPS $2. PM $6. FCPS $2. REGNL RATE BOX A $9.99 Delivery Time Up to days 2 days days 208 Best Carrier & Service PM FCPS FCPS FCPS REGNL RATE BOX A 208 Forecast 208 Best Pricing $.5 $.05 $.66 $.05 $ Estimated Price Change -$0.6 $0.28 -$. $0.28 $0.0

16 Case study Online grocers Our fourth case is derived from three small online grocers that ship high volumes of relatively dense packages, often requiring special packaging (e.g. for liquids or perishables requiring cold packs). For these sellers, is generally the best option. Carriers Delivery options Standard 2- day guaranteed 2 day guaranteed Overnight guaranteed Delivery charges Weight or value based Flat rate Threshold-based free Free shipping on every order Package Contents Pasta Candy Jam Drip Coffee Flavor Packets Dimensions Small Flat Rate Rgnl Rate A Box " x " x 6" 2" x 0" x 0" Custom Package Package Shipping Parameters Weight 2 oz. 6 oz. 28 oz. 96 oz. 95 oz. Zone 8 Carrier & Service PM PM PM PM PM 20 Shipping Actuals Shipping Cost $6.25 $9.99 $6.0 $.29 $22.6 Delivery Time 208 Best Carrier & Service SMALL FLAT RATE BOX REGNL RATE BOX A PM PM PM 208 Forecast 208 Best Pricing $6.85 $0.29 $.0 $.29 $ Estimated Price Change $0.60 $0.0 $0.6 $0.00 $0.68

17 Case study 5 Automotive parts retailers Our final case is derived from a pair of small online automotive retailers that ship high volumes of relatively dense, sometimes bulky packages. This case illustrates that is becoming more competitive on these sorts of packages, sometimes even against and negotiated rates. Carriers Delivery options Standard Delivery charges Weight or value based 2- day guaranteed Flat rate 2 day guaranteed Threshold-based free Overnight guaranteed Free shipping on every order Package Contents Diesel Auto Power Genuine OE Injector Performance Injectors Engine Oil Filter Accessories* Color Tire Tread Depth Gauge Dimensions Custom Package Pak Large FR Box 20" x 8" x 6" Custom Package Package Shipping Parameters Weight 2 lb..5 lb. lb. 8 lb. oz. Zone Carrier & Service PM Overnight PM Ground FCPS 20 Shipping Actuals Shipping Cost $6.0 $5.9 $6.55 $8.5 $2.6 Delivery Time Next Day Up to 5 days 208 Best Carrier & Service PM PME LARGE FLAT RATE BOX PM FCPS 208 Forecast 208 Best Pricing $6.90 $.86 $.0 $8.2 $ Estimated Price Change $0.60 -$. $0.55 $0.09 $0.05 *For the accessories shipment: in 20, PM would have been $.96, saving the seller a bit over their negotiated rate. We expect that their rate will go up in 208 by at least the average of.9%, meaning the slightly increased PM rate will remain a better deal (and also get the package to the buyer in less time). 5

18 How ShippingEasy can help ShippingEasy is the easiest cloud-based shipping platform on the market. With ShippingEasy, online merchants of all sizes can ship fast, access the best rates, and grow orders. Whether you ship 50 packages per month or 50,000, our solutions will streamline your operations and help you effectively compete and succeed in the e-commerce space by: Providing access to the lowest rates available up to a 6% discount to standard rates Easily integrating with all leading e-commerce platforms, shopping carts, Fullfillment By Amazon (FBA), marketplaces, and carriers Supporting multiple users, multiple stores and fulfillment locations, international selling, offline orders, and returns processing Automating the shipping process by allowing you to define label printing rules based on package weight, size, delivery preference, and more Managing and synchronizing inventory in real time across all channels, automating purchase orders, and improving supplier communication Nurturing repeat business with marketing, product recommendations, and personalized communication to every customer Providing the best support in the industry, with full set-up and configuration included, plus ongoing help am-pm CT To learn more, request a demo or sign up for a free trial, visit or give us a ring at

19 Appendix A note regarding dimensional pricing Dimensional weight is the weight used to calculate the shipping cost of large lightweight packages. At some point the cost of shipping such packages becomes driven more by the amount of space they take up than by their weight, so carriers use dimensional weight to more closely match the prices they charge for large lightweight packages to the costs of shipping such packages.,, and have all used some form of dimensional pricing for packages that meet certain criteria for several years. and are making minor changes to their dimensional pricing rules for 208; for full details visit the links provided in the table below. This table explains how to calculate dimensional weight and apply each carrier's formula to determine their shipping price. ShippingEasy also offers a free, easy-to-use dimensional weight calculator at For packages shipping by these services: Priority Mail packages larger than cubic foot in volume and shipping to zones 5-8 only All services/all zones All services/all zones Determine volume in cubic inches: Multiply Length X Width X Height Calculate dimensional weight in lb.: If volume exceeds,28 cubic inches, divide by 9 to get dimensional weight in lb.; if volume is,28 or less, use actual weight Divide by 9 to compute dimensional weight in lb. Divide by 9 to compute dimensional weight in lb. To determine shipping cost: Look up the greater of the actual weight or the calculated dimensional weight in the appropriate rate table General description: General description: For more information see: Changes effective //8: Changes effective 2/2/:

20 Appendix 208 overnight rate comparisons up to 5 lb. Weight Not Over (lb.) Carrier Local, &2 Zone Zone Zone 5 Zone 6 Zone Zone 8 0.5/Letter /Letter /Letter This paper is intended for use as a general guide, not an official pricing source for any carrier. Our analysis is based on several assumptions that may change over time and may not be valid for your business. Be sure to double check the rates available to you before making any shipping-related decisions. Rates shown are for Priority Mail Express Commercial Plus Pricing, Standard Overnight Standard Pricing with residential and fuel surcharges, and Next Day Air Daily Rates with residential and fuel surcharges. 2 Pricing shown in these rows represents the 0.5 lb. price for ; for and, the price shown is for a carrier-provided letter-size envelope, which can weigh up to 0.5 lb. 8

21 Appendix 208 overnight rate comparisons 6 to 0 lb. Weight Not Over (lb.) Carrier Local, &2 Zone Zone Zone 5 Zone 6 Zone Zone This paper is intended for use as a general guide, not an official pricing source for any carrier. Our analysis is based on several assumptions that may change over time and may not be valid for your business. Be sure to double check the rates available to you before making any shipping-related decisions. Rates shown are for Priority Mail Express Commercial Plus Pricing, Standard Overnight Standard Pricing with residential and fuel surcharges, and Next Day Air Daily Rates with residential and fuel surcharges. 9

22 Appendix 208 second day rate comparisons up to 5 lb. Weight Not Over (lb.) Carrier Local, &2 Zone Zone Zone 5 Zone 6 Zone Zone 8 0.5/Letter /Letter /Letter This paper is intended for use as a general guide, not an official pricing source for any carrier. Our analysis is based on several assumptions that may change over time and may not be valid for your business. Be sure to double check the rates available to you before making any shipping-related decisions. Rates shown are for Priority Mail Commercial Plus Pricing, 2Day A.M. with residential and fuel surcharges for 0.5 lb./letter pricing, 2Day Standard Pricing with residential and fuel surcharges for weights of lb. and more, and 2nd Day Air Daily Rates with residential and fuel surcharges. 2 Pricing shown in these rows represents the 0.5 lb. price for ; for and, the price shown is for a carrier-provided letter-size envelope, which can weigh up to 0.5 lb. 20

23 Appendix 208 second day rate comparisons 6 to 0 lb. Weight Not Over (lb.) Carrier Local, &2 Zone Zone Zone 5 Zone 6 Zone Zone This paper is intended for use as a general guide, not an official pricing source for any carrier. Our analysis is based on several assumptions that may change over time and may not be valid for your business. Be sure to double check the rates available to you before making any shipping-related decisions. Rates shown are for Priority Mail Commercial Plus Pricing, 2Day A.M. with residential and fuel surcharges for 0.5 lb./letter pricing, 2Day Standard Pricing with residential and fuel surcharges for weights of lb. and more, and 2nd Day Air Daily Rates with residential and fuel surcharges. 2

24 Appendix 208 ground rate comparisons up to 5 lb. Weight Not Over (lb.) Carrier Local, &2 Zone Zone Zone 5 Zone 6 Zone Zone This paper is intended for use as a general guide, not an official pricing source for any carrier. Our analysis is based on several assumptions that may change over time and may not be valid for your business. Be sure to double check the rates available to you before making any shipping-related decisions. Rates shown are for Priority Mail Commercial Plus Pricing, Ground Standard Pricing with residential and fuel surcharges, and Ground Daily Rates with residential and fuel surcharges. 22

25 Appendix 208 ground rate comparisons 6 to 0 lb. Weight Not Over (lb.) Carrier Local, &2 Zone Zone Zone 5 Zone 6 Zone Zone This paper is intended for use as a general guide, not an official pricing source for any carrier. Our analysis is based on several assumptions that may change over time and may not be valid for your business. Be sure to double check the rates available to you before making any shipping-related decisions. Rates shown are for Priority Mail Commercial Plus Pricing, Ground Standard Pricing with residential and fuel surcharges, and Ground Daily Rates with residential and fuel surcharges. 2

26 Appendix Assumptions This analysis focuses on shipping situations most often encountered by small- and medium-sized businesses. Therefore, special situations such as international shipping, hazardous materials shipping, and early morning delivery were not analyzed. Limits: only accepts packages with a combined length and girth of 08" or smaller; this analysis does not consider packages dimensionally larger than this. - Both Home Delivery and services allow packages up to 08" in length and up to 65" in combined length and girth. Only and will handle packages between 0 and 50 pounds will not. Only will handle packages over 50 pounds. If you are shipping multiple products with a total weight greater than 0 pounds, you should look into the possibility of breaking the shipment into two or more packages: shipping multiple packages of 0 or fewer pounds each via is generally less costly than shipping one package of the total weight by or. There are many ways to obtain Commercial Plus Pricing (for example, all ShippingEasy customers with paid accounts automatically receive it), so we ve used this pricing level for all pricing in our models. and typically negotiate specific pricing with each of their clients based on a number of criteria. Since we can t know what your negotiated rates with these carriers may be, we have used their lowest published 208 rates ( Daily and Standard List) in our models. If you use one of these carriers, you should double check your rates for the specific situations where we show as being a better deal. 2

27 Appendix Assumptions (continued) and both apply various surcharges; we considered the following to be relevant to our analysis and included them: - Residential surcharge: a flat fee per package applied to deliveries to households. We used: The Express residential surcharge of $.5, effective as of January, 208 The Home Delivery surcharge of $.60, effective as of January, 208 The residential surcharges of $.60 (Ground) and $.5 (Overnight and 2 day), effective as of December 2, 20 - Fuel surcharge: a percentage upcharge applied to every package which changes periodically based on a number of factors. We used: The Express fuel surcharge of.25% and Ground fuel surcharge of 5%, which were in effect through November 5, 20 The Air fuel surcharge of 6% and Ground fuel surcharge of 6%, which were in effect through November 6, 20 and both offer delivery services in collaboration with ( SurePost and SmartPost ). Because these services have prerequisites that make them less attractive for smaller sellers, we have omitted them from our analysis. 25

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