UPS Hikes Mail Innovations Rates ~25% In Christmas Eve Surprise Announcement
UPDATE 1-8-25
As we wait for official answers from UPS about the future of SurePost, product page updates indicate the company is working to move volume in-house as part of Network Of The Future initiative after USPS contract expired last week.
Liz Morton
UPDATE 1-7-25
USPS is hitting back at attempts to place blame for sudden changes impacting consolidators and hybrid services, with a "no names mentioned" Postal Bulletin clearly aimed at UPS.
Liz Morton
UPDATE 1-2-25
The unannounced UPS updates keep coming as Surepost suddenly drops service to PO boxes, AK, HI, PR and more.
Liz Morton
UPDATE 12-31-24
On the back of changes that have forced UPS to increase Mail Innovations rates, USPS is cranking up the competition for lightweight packages, hoping to woo shippers to Ground Advantage with new streamlined Negotiated Service Agreements.
Liz Morton
UPS has dropped a big Christmas Eve surprise, notifying shippers who use their Mail Innovations service that rates will be increasing by ~25% on January 1st.
ShipMint founder Brandon Staton posted the notice on LinkedIn, saying customers had zero time to adjust to the much steeper rates.
UPS is putting the blame for the increase directly on USPS, saying Parcel Select increases, eliminating discounts for DDU-entry and other Postal Service actions have put the company in an untenable position.
On November 15, the United States Postal Service (USPS) announced that it intends to raise its Parcel Select rates by 9.2%, effective January 19, 2025.
This comes after the Postal Service first raised its Parcel Select rates 5.9% on average in January 2024 and then implemented a further Parcel Select rate increase of 25% in July. In addition, the Postal Service has eliminated the Parcel Select Lightweight product and discounts for DDU-entry.
UPS Mail Innovations has taken and will continue to take steps to minimize the impact of the Postal Service’s product changes and rate increases on our customers. However, as a result of recent Postal Service actions, UPS Mail Innovations has to adjust the 2025 rates.
We do not take this increase lightly, and we have done diligence to minimize the impact on our customers. Please see the following page(s) for your new 2025 rates, which will be effective January 1, 2025.
UPS Mail Innovations is a contracted service offering with negotiated rates, so while it's not possible to show an exact rate breakdown, Staton went on to share thoughts about the general impact of this change based on ShipMint's analysis of from their customer data.
Brandon Staton
According to ShipMint's analysis, the new pricing represents a 25% increase, with the light packages seeing the largest difference.
Lightweight Packages Face the Steepest Hike
While across-the-board increases are apparent, ShipMint’s preliminary analysis shows that the lightest parcels—traditionally the lifeblood of many e-commerce brands—are seeing the highest percentage increase.For merchants whose product lines depend on competitive shipping costs for lightweight items (like apparel, accessories, or small electronics), this could mean a significant bump in operational expenses starting the very first day of the new year.
Parcel Select Lightweight Eliminated
The most notable news from the UPS Mail Innovations announcement is the confirmation of the long-rumored elimination of the USPS Parcel Select Lightweight product. UPS MI's subsequent on sub-1 pound shipments, sends a strong signal that other major carriers (like DHL and regional forwarders) are likely to announce similar changes, sending ripple effects throughout the e-commerce sector.What This Means for Shippers
- Tighter Margins: The 25% jump—particularly on lighter parcels—can eat into already-tight margins for online retailers.
- Minimal Adjustment Time: A mere one-week notice leaves businesses scrambling for contingency plans.
- Other Carriers Likely to Follow: As the USPS has retired Parcel Select Lightweight, other shipping providers often align their product offerings and rates to ensure market competitiveness.
How will this UPS Mail Innovations rate hike impact your ecommerce business? Let us know in the comments below!
much too complicated now for a few pounds a year in sales
They just "killed the golden goose". I imported my 1500+ eBay items to there since it was free. Turned out just to be a lot of work for (maybe) 3 sales a month.
The total fees were higher there before this new $20 a month cost structure, even though they claimed otherwise. When one factors in the 3.49% + 49 cent PayPal processing fees so one can get paid, there went a good chunk of profit.
Now they have boosted their commission to 11%, and still claim that the cost to sell there is less than eBay's. And remember that this does not include payment processing. WHY?? Makes no sense at all.
On eBay, for $27.95 a month, I sell over 100 items there every 30-31 days. Makes ZERO SENSE to pay a site $20 to make just a couple of sales. Since they now allow 50 "free listings", I have trimmed my offerings back to just below that amount. Also had to raise all my prices accordingly to absorb the extra selling costs.
The people who run the show here obviously didn't realize that eBay sellers who imported their listings gave the site a great depth of product, which would attract more buyers. Now that will be gone, because NO ONE will pay them $20 monthly for little to no sales.
The site also has technical issues that they refuse to fix. It was a decent resource to enable the occasional sale, but they will soon be stacked onto the eCommerce trash heap of companies that THOUGHT they could compete with Amazon and eBay. Etsy may also suffer the same fate soon, as many sellers are also leaving their site due to high fees, website issues, and poor management.
Basic eComm rule here: When you do not carry any inventory, and sellers are solely responsible for supplying your site with the goods offered, DON'T BITE THE HAND WHICH FEEDS YOU!!!