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Monthly Archives June 2016

Postal Dog Bite Data

At Visible, we do our best to keep our followers abreast of the most crucial USPS information that crosses our desk, which is why we’re bringing you the most up-to-date information regarding postal worker dog attack rankings, city-by-city.
Every year, the USPS releases a list of which cities are the worst for dog attacks in the U.S. See below:

Rank City State 2015 Dog Attacks 2014 Dog Attacks Change Percent Change
1 Houston TX 77 63 14 22%
2 San Diego CA 58 47 11 23%
3 Cleveland OH 58 37 21 57%
4 Chicago IL 57 46 11 24%
5 Dallas TX 57 43 14 33%
6 Los Angeles CA 56 75 -19 -25%
7 Louisville KY 51 40 11 28%
8 Kansas City MO 46 32 14 44%
9 Philadelphia PA 44 33 11 33%
10 Columbus OH 43 22 21 95%
11 Portland OR 41 31 10 32%
12 Fort Worth TX 39 26 13 50%
13 San Antonio TX 39 24 15 63%
14 Denver CO 38 40 -2 -5%
15 Phoenix AZ 36 35 1 3%
16 St. Louis MO 35 39 -4 -10%
17 Seattle WA 34 29 5 17%
18 Detroit MI 32 28 4 14%
19 Long Beach CA 32 27 5 19%
20 Indianapolis IN 31 35 -4 -11%
21 Sacramento CA 31 29 2 7%
22 Minneapolis MN 30 33 -3 -9%
23 Baltimore MD 30 27 3 11%
24 Miami FL 28 26 2 8%
25 Cincinnati OH 28 24 4 17%
26 Brooklyn NY 26 15 11 73%
27 San Francisco CA 25 23 2 9%
28 San Jose CA 24 20 4 20%
29 Albuquerque NM 24 16 8 50%
30 St. Paul MN 24 6 18 300%
31 Oakland CA 23 22 1 5%
32 Milwaukee WI 23 11 12 109%
33 Charlotte NC 22 23 -1 -4%
34 Dayton OH 22 18 4 22%
35 Las Vegas NV 21 19 2 11%
36 Pittsburgh PA 20 22 -2 -9%
37 Jacksonville FL 20 10 10 100%
38 Rochester NY 19 18 1 6%
39 Fresno CA 19 17 2 12%
40 Stockton CA 19 9 10 111%
41 Wichita KS 18 25 -7 -28%
42 Flushing NY 18 14 4 29%
43 Baton Rouge LA 18 9 9 100%
44 Memphis TN 17 13 4 31%
45 Richmond VA 16 17 -1 -6%
46 Salt Lake City UT 16 9 7 78%
47 New Orleans LA 15 19 -4 -21%
48 Omaha NE 15 14 1 7%
49 Des Moines IA 15 11 4 36%
50 Toledo OH 15 10 5 50%

I’m sure Los Angelenos are extremely upset, not only about losing the top spot this year, but also about falling all the way to sixth. Meanwhile, Cleveland and Columbus were tied for the two biggest jumps, both adding 21 new victims this year alone. Clearly, Ohio’s dogs are sick and tired of postal workers setting foot on their properties.
Looking at a state-by-state map, we start to see some other trends:
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The fact that Texas and California came in first and second respectively is no surprise, as they are first and second in population as well. But the sleeper award goes to Ohio, which has clinched the coveted third top spot in postal worker dog attacks. All that hard work by the dogs in these cities has clearly paid off. Is there something in the water in the Buckeye state? In fact, the entire mid-west region is a surprisingly dangerous place to be a USPS employee when it comes to canines yet could be a surprisingly lucrative region if you’re in the pepper spray business.
If looking to avoid bites, a postal worker’s dream is the Southeast. Not only were most states in this area too low on the list to even register, but Florida, which has the third highest population in the country, is 17th on the bad dog list. Maybe moving in with grandma isn’t such a bad idea after all.

Understanding Rate Increases

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Confused?

Have you ever wondered why the “advertised” rate increases for small parcel carriers never seem to add up? This is a question we have heard over and over, especially since both FedEx and UPS recently implemented their annual small package rate increases. The UPS rate increase took effect on December 29, 2014, while the FedEx rate increases took effect on January 5, 2015. As always, the extent to which your particular small package shipments are affected largely depends on many factors, including shipment volumes, sizes, weights and modes, as well as your company’s national distribution locations.

Quick Facts: The General rate adjustment was announced as an average increase of 4.9 percent for U.S. and international shipments. Dimensional weight pricing will now apply to all FedEx Ground and UPS Ground shipments.

Based on this information, you may have thought that your current small package shipping rates with FedEx and UPS would have gone up around 4.9 percent for ground, express and international shipments. If you planned on this data to forecast and budget your 2015 shipping costs, you may be wondering why actual shipping charges are in reality higher and blowing out the budget.

Additionally, both carriers implemented dimensional weight pricing on all ground packages for 2015. This has resulted in significant increases depending on shipping characteristics. Average rate increases for FedEx and UPS are just that – average.

Ground Shipments:

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As in recent years, there has been an overall increase in shipping volume. The largest increase across all carriers has been packages weighing one to ten pounds, regardless of zone. The majority of that uptick is in packages weighing less than six pounds. The 2015 increase for all ground shipments ranged between two percent and seven percent over 2014 rates. If your shipping characteristics include a large number of residential or home delivery shipments, the increase on accessorial fees had a compounding affect. The ground minimum went from $6.24 to $6.61. That alone is a 5.6 percent increase. Depending on the number of shipments that consistently hit the minimum, this can have a major impact on your bottom line.

Residential or home delivery increases went from $2.90 to $3.10. That’s a six percent increase. On average, 33 percent of ground shipments receive a delivery area surcharge of some sort. Obviously, shipping characteristics play a major part in the net effect of an annual average rate increase for you. 4.9 percent may be an overall average for the carriers, but some businesses have seen their shipping rates rise above 6 percent.

Surprise!

You may be surprised to know that fees for extra services can account for up to 20 percent or more of your total transportation costs.

Both FedEx and UPS will begin applying a new calculation to dimensional weightimage00

(DIM) pricing to all ground shipments. Previously, only packages three cubic feet or larger were affected by DIM pricing. Implementing these DIM calculation changes has effectively caused an additional price increase and will affect more than a third of all U.S. ground shipments, on average. The new rules could result in significant rate increases depending on your shipping characteristics.

Dimensional weight pricing is a common industry practice that sets the transportation price based on package volume in relation to its actual weight. Carriers use DIM weight in order to account for the space packages take up in their transportation vehicles. This model encourages reductions in excess packaging materials and overall package sizes, leading to reduced fuel use, vehicle emissions and transportation costs. Once DIM weight is calculated, it is compared to the actual weight, and the higher of the two is applied. Density is the name of the game; make sure you review your packaging needs to reduce the size of your overall shipment and/or increase the weight. Avoid using oversized boxes that contain unused space and, where possible, consolidate orders to increase your shipment weight and density. By being more efficient with your packaging, you’ll ensure you’re not paying your carrier to ship “empty space.”

In conclusion, the real effect of the 2015 rate increase highly depends on your company’s packaging and shipping characteristics.

What does that mean to you?

Announced average rate increases paint an inaccurate picture of the true impact these increases may have on your business. For more information, contact Visible and talk to one of our shipping experts. We can help you understand the full impact of carrier increases and form a comprehensive transportation plan that will put you back in the transportation driver’s seat. We can help with all your supply chain needs – from efficient packaging solutions to shipping plans that match your company’s shipping characteristics.

We have you covered.

Let one of our supply chain experts provide you with a free, no obligation shipping, packaging and fulfillment analysis to ensure you are getting the most out of your transportation spend. Contact us today (link to contact page).

Dimensional Discounts and Surcharges

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In the last few years, all parcel conversations have come back to dimensions. With the introduction of the dimensional charges in 2015, UPS and FedEx customers saw a large increase in their shipping costs for many items, and it seemed difficult to get a hold on which items got charged and why. When the USPS followed suit with its own dimensional rules, things got even more complicated and confusing.

This article on dimensional discounts and surcharges attempts to break down the reasons, rules and effects of dimensional pricing, and what a shipper can do to ease the burden.

UPS and FedEx Dimensional Pricing

People often wonder why Dimensional charges are even added in the first place. For UPS and FedEx, these surcharges are the answer to a problem that has been growing for them. The fact is, private carriers are not built to handle small or light packages. Their network and pricing structure is better suited to large packages, or a large number of packages going to one location. This pricing structure worked fine for years, but with the rise of e-commerce shipping, more individual items started to be sent directly to people’s homes. The first step for UPS and FedEx to counter the rising cost of small residential shipments was to add in the residential surcharge, but that maneuver still wasn’t enough to recoup lost revenue, so they started adding a surcharge specifically to small packages.

UPS and FedEx, like in so many other things, have the same rules for their dimensional packages, and, thankfully, the rules are relatively simple. A shipper needs to compare the actual weight of his or her package to what is known as the dimensional weight, and whichever is higher, that is the weight the shipper is charged. The formula for determining dimensional weight is:

Length” x Width” x Height”
166 lbs.

GettyImages-493827934_Most boxes produced will have all three dimensions printed on the bottom, so often there’s no need to measure. Simply take those numbers and determine the dimensional weight. This equation brings up one of the most deceiving parts of dimensional weight. It seems like there shouldn’t be many situations when that math would really affect your shipping, but it happens on a surprising number of shipments. Here’s an illustrative example:

Let’s take this simple handbag. A bag like this weighs 2 pounds and retails for $30-$40 online. Shipping this handbag using UPS or FedEx Ground Service (4-6 days) will cost anywhere from $8.50-$11.50. Its dimensions are 15” x 13” x 7.5”, so the math is pretty easy to figure out.

15″ x 13″ x 7.5″ = 8.81
166 lbs.

All carriers round up when it comes to real weight or dimensional weight, so that 2-pound purse becomes a 9-pound purse. Shipping costs jump from $8.50-$11.50 to $11.50-$20.70. If customers pay for shipping directly, and they realize that that their cheapest option could be as much as 2/3 the cost of the actual product, this increases the likelihood of more customers abandoning their carts. If the shipper is paying for shipping, an average increase of $5.64 per package adds up quickly.

Analyzing an example like the handbag scenario can be surprising, but what’s more amazing is how many products end up receiving this surcharge. It becomes essential for shippers to know the dimensions of every box they send and to make sure they track which ones are getting surcharged in order to make smart decisions about shipping in the future.

USPS Dimensional Surcharges

Postal Service Dimensional surcharges came about for a different reason, and so the rules are vastly different. The USPS network is actually ideal for smaller and lighter packages, so it has no reason to create rules that de-incentivize sending packages fitting that profile. USPS’ dimensional rules are actually contingent upon what equipment and personnel different facilities can handle at any given time. Some equipment, in some postal facilities, just can’t accommodate really large or really long boxes, so those parcels get a surcharge if they end up traveling over a certain distance.

The rules for the USPS are not only different, they are also more complicated. In fact, there are two different rules for packages going either long distance or short distance. For long distance (Shipping Zones 5-9), the rule is similar to UPS and FedEx (i.e. take the larger between actual weight and dimensional weight), but the calculation of dimensional weight is different and only applies to certain packages:

Length” x Width” x Height”
194 lbs.

The larger divisor (bottom number in case you aren’t up-to-date on your high school math) means that the dimensional weight will be smaller than with UPS and FedEx, which results in fewer packages getting penalized with dimensional weight surcharges. Also, packages whose L x W x H is greater than 1728” can receive the dimensional surcharge, which limits the number of packages that apply even further. For example, the handbag in the UPS/FedEx example does not get charged a dimensional weight by the USPS because 13”x 15” x 7.5” = 1462.5”.

For shorter distance shipments (zones 1-4), the rule is a bit more complicated. To receive the dimensional surcharge, the package needs to be less than 20 pounds and meet the criteria of the following formula:

(Longest Side”) + [(2 x Width”) + (2 x Height”)] = between 84” and 108”

If your package meets the above conditions, then no matter the weight, the package will be charged at the $20 weight. That seems like a harsh penalty, but in truth, this is a rare occurrence. You’d have to ship a ladder or two pillows packed lengthwise to incur that surcharge.

USPS rules are definitely different than the UPS/FedEx rules. Due to the unique nature of their rules, they apply to very few packages.

USPS Dimensional Discounts

USPS_Eagle-Symbol-web-sizeWhile people have been talking a lot about dimensional surcharges, an often forgotten rule that can actually benefit a shipper is the USPS Dimensional Discount, commonly referred to as USPS Cubic Pricing. As mentioned before, the USPS network is ideal for small, light packages, and while private carriers use surcharges to discourage behavior, the USPS has tried to encourage large shippers to use them by offering discounts on packages that work best in the USPS network.

Dimensional Discounts with the USPS apply to packages that are lighter than 20 pounds and less than 50 percent of a cubic foot. To determine if one of your boxes applies, use the following formula:

(Length” x Width” x Height”) < 864

Further discounts apply if a package is 40 percent, 30 percent, 20 percent or 10 percent of a cubic foot. An example will be useful to help understand how drastic these discounts can be.ThinkstockPhotos-521976536_

An alternator for a car can be expensive to ship. Alternators can weigh between 12-15 pounds. Fortunately, they are small objects, usually around 7” x 7” x 7”. If an alternator is shipped via USPS, and it was charged based off the actual weight, the price can be anywhere from $9.50-$43.50. When applying the formula for dimensional discount, an alternator is 20 percent of one cubic foot, which means the pricing range is only $5.75-$7.10. On average, you can save $16.85 per package by shipping an alternator using USPS Dimensional Discounts. That bears repeating. On average, you can save $16.85 per package by shipping an alternator using USPS Dimensional Discounts. You can see how important getting these types of packages are for the USPS.

Conclusion

With the rise of e-commerce shopping, the number of parcels moving around the country will only get bigger. As more packages are being shipped, the rules will only get more complicated, but the importance of knowing the dimensions of your package can not be overstated. Your dimensions should be captured and looked over to help determine what you can do to save money on shipping. It’s the main reason a company like Parcel Partners exists. We can help a company look at their shipments and find ways to avoid expensive surcharges and ship smarter.