USPS rolls out proposed 2019 rate increases

If approved, these price increases would take effect in January 2019

By ·

Proposed 2019 price increases were submitted by the to the , an independent Federal agency that provides transparency and accountability of the U. S. Postal Service's operations, yesterday.

Should the Governors of the Postal Service approve these proposed USPS rate increases, they would take effect on January 27, 2019.

USPS said that its Mailing Services product prices, which include Letters, Letters additional ounces, Outbound International Letters, and Domestic Postcards would see an increase of around 2.5%

Of significant relevance to shippers are the proposed rate increases for USPS’s Shipping Services, with the USPS explaining that these price increases vary by product, with offerings like Priority Mail Express and Priority Mail pegged to increase by 3.9% and 5.9%, respectively. Unlike Mailing Services rate increase, which the USPS said are based on the Consumer Price Index, Shipping Services rates are primarily adjusted based on market conditions, it said, adding that the USPS Governors contend these proposed rate increases “will keep the Postal Service competitive while providing the agency with needed revenue.”

Some of the proposed Shipping price increases include:

  • Small Flat Rate Box, from $7.20 to $7.90, an 8.9% increase;
  • Medium Flat Rate Box, from $13.65 to $14.35, a 4.9% increase;
  • Large Flat Rate Box, from $18.90 to $19.95, a 5.3% increase;
  • APO/FPO Large Flat Rate Box, from $17.40 to $18.45, a 5.7% increase;
  • Regular Flat Rate Envelope, from $6.70 to $7.35, an 8.9% increase;
  • Legal Flat Rate Envelope, from $7.00 to $7.65, an 8.5% increase;
  • Padded Flat Rate Envelope, from $7.25 to $8.00, a 9.4% increase

What’s more, the USPS said that its First-Class Package Service, a lightweight expedited offering used mainly by businesses for fulfillment purposes, will shift to zone-based pricing in an effort to better align with the cost of service and improve value based on distance. 

, said that this rate increase is fairly significant, but it comes with a few caveats.

“The PRC has to approve this, and the USPS has, on paper, been losing billions per year for many years and the current balance sheet is unsustainable,” he said. “The USPS does not lack volume. It lacks pricing that volume to cover the attributable costs for transporting and delivering those items (mail and parcel).”

In August, the USPS said fiscal third quarter earnings resulted in a net loss of $1.5 billion, which was roughly in line with the losses it has sustained on a quarterly basis over the last several years. USPS officials have cited a flawed business model imposed by law as the main reason for these ongoing losses. said that the USPS supports support legislation under consideration in the current Congress which would provide immediate flexibility to the organization, allow the Postal Service to invest in its future and continue to provide the prompt, reliable, efficient and universal service the public expects.

Despite its financial travails, the USPS’s Shipping Services Group continues to post impressive volume and revenue gains, due, in large part, to its Parcel Services and Package Services groups, with these gains paced largely by the continuing growth of e-commerce, with the caveat that this subcategory is mainly a “last-mile” service that “bypasses much of our infrastructure and therefore is one of our lowest-priced package services, and as a result, produces a lower yield per piece when compared to many of our other services,” according to a Form 10-Q statement released earlier this year.


About the Author

Jeff Berman, Group News Editor
Jeff Berman is Group News Editor for Logistics Management, Modern Materials Handling, and Supply Chain Management Review. Jeff works and lives in Cape Elizabeth, Maine, where he covers all aspects of the supply chain, logistics, freight transportation, and materials handling sectors on a daily basis. Contact Jeff Berman

Subscribe to Logistics Management Magazine!

Subscribe today. It's FREE!
Get timely insider information that you can use to better manage your entire logistics operation.


Article Topics

e-commerce · Last Mile · parcel · USPS · All Topics
Latest Whitepaper
Control Costs with a Smarter Warehousing Management Systems
To have effective fulfillment, you need a WMS that manages not only inventory, but also labor and machines, stays in synch with transportation updates, and is easy to personalize.
Download Today!
From the October 2018 Logistics Management Magazine
Volumes are strong and steady, service is improving, yet our panel of the nation’s foremost rail experts says that there’s still plenty of work to be done on the nation’s rails to help shippers fill what’s now a massive capacity need.
Lift Truck End-of-life Management: Have a plan
Inventory Management 101: Time to step up to the plate
View More From this Issue
Subscribe to Our Email Newsletter
Sign up today to receive our FREE, weekly newsletter!
Latest Webcast
See Your Supply Chain Like Never Before
How do the world’s top supply chains see further and act faster? Many of them are gaining an understanding of how their supply chain flows are tied to outcomes to stay ahead of problems, and gain whole new efficiencies. Join us to learn more.
Register Today!
EDITORS' PICKS
8th Annual Rail/Intermodal Roundtable: Work in progress
Volumes are strong and steady, service is improving, yet our panel of the nation’s foremost rail...
Transportation Best Practices and Trends: Frios’ cool solution for a hot seller
Gourmet ice pop maker adopts collaborative cold chain solution to keep profits from melting away due...

35th Annual Quest for Quality Awards: Scaling to new heights of service
Which carriers, third-party logistics providers and U.S. ports have reached the pinnacle of...
29th Annual State of Logistics Report: Carriers take the wheel
As if higher rates and capacity shortages weren’t enough to worry about, shippers must now deal...