Dimensional weight pricing is a common industry practice that sets the transportation price based on package volume—the amount of space a package occupies in relation to its actual weight. Currently, dimensional weight only comes into play when you’re shipping via:
- Domestic Air
- Domestic Ground (packages over 3 cubic feet or 5,184 cubic inches)
For example, let’s say you have a box that measures 24” x 24” x 20”. If you multiply those dimensions together you get 11,520 cubic inches. Because that box is larger than 5,184 cubic inches, dimensional weight is triggered. To find the dimensional weight, you simply divide the total cubic dimensions by 166 (domestic DIM factor). International DIM factor is 139. So in this case, the dimensional weight is 11,520 / 166 = 69.4 lbs.
That means that when you ship that box you’ll be billed at a minimum of 70 lbs. (the carriers round up to the nearest pound). If the package weighs more than 70 lbs., then you’ll be billed for shipping at the actual weight. If the actual weight is less than 70 lbs. then the dimensional weight will apply and you’ll be billed at 70 lbs.
Up until now, FedEx and UPS only charge domestic ground dimensional weight when packages are greater than 5,184 cubic inches. Effectively, you can still ship a good sized package that is relatively light and only be charged based on actual weight.
So, this brings us to a major change by the carriers in 2015. UPS and FedEx announced that effective December 29th, 2014 (UPS) and January 1, 2015 (FedEx), both major carriers would apply dimensional weight pricing to all U.S. ground shipments. This means that there will be a price increase for ground packages that are light but large in size.
If this concerns you, here are a couple areas to consider helping minimize the potential increase in shipping costs you may see in 2015.
1. Evaluate packaging: Evaluate the size of the shipping boxes that you are using to minimize the effect of this change. You may also want to go further upstream and re-think the physical dimensions of the retail box of the actual product itself. The less air space, the better.
2. Alternative shipping methods: You may want to consider shipping options that are not impacted by the change such as USPS, FedEx SmartPost, among others. Obviously, you will need to consider the pros and cons of the other shipping methods in your evaluation.
This isn’t simply a price increase, it’s a complex change that requires businesses careful consideration and evaluation. Please read more about these changes directly from FedEx and UPS.