Practical Ecommerce

7 Reasons to Consider USPS Flat Rate Shipping

The United States Postal Service offers a number of flat rate boxes that may help online stores reduce shipping costs while improving shoppers’ buying experience.

Shipping can be a significant challenge for online retailers. There are packaging materials to purchase, and carriers’ fees and fuel surcharges to contend with. What’s more, merchants must face large competitors who have negotiated special shipping rates or who have the financial wherewithal to lose money on some orders in order to increase market share.

For example, online and catalog retailer L.L. Bean recently announced free shipping on every purchase no minimums and no end date. L.L. Bean’s move toward always-free shipping may well be a new trend. Here is the video from L.L. Bean’s president, announcing the free shipping.

Zappos likewise offers frees upgrades and free return shipping on all orders, and Overstock gives new shoppers free shipping. When you cannot pass shipping charges onto customers, those charges can slash margins and leave very little room for profit.

The Advantage of Flat Rate Shipping

Among the various carriers available to North American online merchants, the USPS offers some of the most attractive options, especially with its aforementioned flat rate and prepaid flat rate boxes and envelopes.

Here are seven reasons to consider these services.

  1. Free boxes. USPS flat rate boxes are free. Merchants can simply order them free of charge and start shipping. The retailer will still need to purchase packing peanuts or similar cushioning material, but not having to pay as much as $1 per box can be a huge savings.
  2. Known costs. Although shipping calculators are very accurate, there are times when the actual shipping rate for a package exceeds what the merchant expected. Flat rate boxes, by their very nature, have a known cost.
  3. Priority delivery. The USPS flat rate boxes are Priority Mail, meaning that a package will normally be delivered in two or three days. Priority Mail packages also get special handling in the USPS system.
  4. No surcharges. The USPS does not add fuel, residential, or Saturday delivery surcharges to any shipment. In an era of rapidly rising gasoline prices, this is an excellent deal, especially when you consider that some carriers are charging fuel fees in excess of 13 percent.
  5. More addresses. The USPS delivers to more U.S. addresses than any other carrier. The service can ship to post office boxes, too. What’s more, the USPS, including its flat rate boxes and envelopes, is the only way to ship to U.S. government addresses, such as military APO, FPO, or DPO.
  6. Greater security. Only the USPS is authorized to place packages in mailboxes. Plus, unlike some carriers that simply leave packages on the porch, the USPS will try to redeliver larger packages. Not abandoning packages may help prevent some kinds of purchase fraud or theft.
  7. Law enforcement protection. Flat rate USPS shipments are protected by U.S. federal law enforcement agencies, which may again contribute to lower fraud and theft rates.

USPS Flat Rate Shipping Prices

There are 11 different prices and packages that can be shipped via U.S. Priority Mail for a flat rate.

  • 12 ½” by 9 ½” Envelope — $4.95
  • 12 ½” by 9 ½” Padded Envelope — $4.95
  • 15″ by 9 ½” Legal-sized Envelope — $4.95
  • 10″ by 7″ Gift Card-sized Envelope — $4.95
  • 10″ by 6″ Small Envelope — $4.95
  • 10″ by 5″ Window Envelope — $4.95
  • 8 5/8″ by 5 3/8″ by 1 5/8″ Small Box — $5.20
  • 11″ by 8 ½” by 5 ½” Medium Box — $10.95
  • 13 5/8″ by 11 7/8″ by 3 3/8″ Medium Box — $10.95
  • 12″ by 12″ by 5 ½ Large Box — $14.95
  • 12″ by 12″ by 5 ½ Large APO/FPO/DPO Box — $12.95

Example Rates: USPS Versus UPS

With the USPS flat rate boxes, “if it fits, it ships,” (up to 70 pounds), making the service especially good for dense or heavy products. As an example of just what this might mean, TheChive website blogged about flat rate shipping early this month. The blog post’s author shipped nearly 60 pounds of pennies in a flat rate box. The package arrived on time and in great shape for the flat rate price, a similar package shipped on another carrier would have been several times more expensive.

Below are several price comparisons, looking at USPS flat rate shipping versus United Parcel Service (UPS).

In the first comparison, I looked at shipping rates for 1, 3, and 5 pound packages that fit in the 8 5/8″ by 5 3/8″ by 1 5/8″ small flat rate box versus an identical package shipped via UPS. In the examples, the packages are shipped from Caldwell, Idaho to New York, Orlando, Chicago, Dallas, San Diego, and Las Vegas. The UPS rate quotes are based on delivery to a residential address and include the company’s current 7.5 percent fuel surcharge on ground packages and 13 percent fuel surcharge on air packages. This fuel surcharge will rise to 8.5 percent and 15 percent respectively on May 2, 2011. Also, it is important to note that these are the UPS’ published rates directly from its website. UPS is known to give frequent shippers some discounts. But those discounts are not published and vary greatly based on geographic location and the merchant’s negotiation skills.

Finally, remember that USPS flat rate boxes and UPS 2nd Day Air boxes are free to the merchant. For UPS ground shipments, the merchant will need to purchase a box at an additional cost, perhaps adding 50 cents or $1 to the merchants shipping investment.

The USPS flat rate box offered was less than half the price of the comparable UPS shipping for a one pound package.

The USPS flat rate box offered was less than half the price of the comparable UPS shipping for a one pound package.

When the package weight was increased to three pounds, the flat rate savings became even more significant.

When the package weight was increased to three pounds, the flat rate savings became even more significant.

For the five pound package, the USPS flat rate shipping was between one-third and about one-ninth of UPS.

For the five pound package, the USPS flat rate shipping was between one-third and about one-ninth of UPS.

In each example comparison above, if you could fit the item into the flat rate box, it would ship for much less. Also, compared to UPS ground shipments, the flat rate box should arrive more quickly most of the time.

In this next set of price comparisons, I looked at shipping a 5, 10, and 15 pound package in a USPS large flat rate box versus shipping the identical page via UPS. I used the same zip codes as above, aimed at residential deliveries. As above, the UPS rates listed here include fuel surcharges and were taken directly from the UPS website at the time of writing.

For the larger box, UPS's ground service was less expensive in three cases, if the cost of the box is not considered.

For the larger box, UPS’s ground service was less expensive in three cases, if the cost of the box is not considered.

As the package becomes heavier, the flat rate box becomes a better value.

As the package becomes heavier, the flat rate box becomes a better value.

Distance is also important in determining the value of using a USPS flat rate box.

Distance is also important in determining the value of using a USPS flat rate box.

Although, UPS was much more competitive against the USPS flat rate box with these larger packages, flat rate boxes still offered the best value most often.

There are some exceptions, for extremely light but large items — imagine a pillow for example — flat rate boxes are usually not the best choice. For example, here is a comparison of the 1-pound large flat rate box and the identical item shipped via UPS.

Light and large packages are generally less expensive to ship via UPS ground service, but in most cases the USPS flat rate box is still much faster.

Light and large packages are generally less expensive to ship via UPS ground service, but in most cases the USPS flat rate box is still much faster.

Summing Up

In a competitive market where the trend is to offer free shipping to every customer regardless of order size, using USPS flat rate boxes can help merchants preserve margins. USPS flat rate boxes are also typically faster than ground shipping, potentially improving the shopper’s experience.

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Armando Roggio
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Comments ( 14 )

  1. kkowal April 26, 2011 Reply

    Great, thorough article. This is a question that comes up a lot with online retailers. I would also add that regular priority mail can also be less expensive than the flat rate option so don’t just assume flat rate is always the better USPS Priority option. Tracking visibility is a concern for some retailers as the USPS does not provide as detailed tracking capabilities as FedEx and UPS offer. Many 3rd party fulfillment operations will offers a greater discount off of UPS/ FedEx shipping rates so if you are working with a 3rd party, the point at which the USPS is a more expensive option often happens a bit quicker than what is illustrated in the analysis.

  2. Derek Bacharach April 26, 2011 Reply

    The flat rate padded 9 x 12 envelope rocks. Since there’s a jump in the flat rate price with a medium-sized box, this padded envelope is a great alternative that has already saved me a lot of money, especially when the package is over a pound.

    The only sour grapes with this padded envelope is you can only order 15 at a time from usps online.

  3. Steve @ten23media April 26, 2011 Reply

    I can 2nd what kkowal mentioned. It’s important to always compare regular priority mail to the cost of the flat rate option. About 60% of the time I’ve found that regular priority mail is cheaper than the flat rate option.

  4. Paula Biles April 26, 2011 Reply

    Thanks for the excellent and detailed article. Another benefit of the USPS Priority Mail is for international shipping. It is MUCH cheaper than other carriers and might be worth another article covering that aspect of their service.

  5. Christine April 26, 2011 Reply

    Something that I don’t think the article mentioned is the new Regional Rate boxes. Since the beginning of the year, these have saved us quite a bit in shipping (along with the padded flat rate envelopes). USPS is definitely the most affordable shipping option for our business. I would love to be able to offer free shipping to my customers but we’re not quite there yet.

  6. Buck April 26, 2011 Reply

    We use the USPS Flat Rate Priority service almost exclusively. We mostly sell a very dense product – popcorn kernels (the postal carriers ask if we’re shipping wet sand!) – at a relatively low cost and the other carriers are not an option. (Ever get hit with a "rural delivery surcharge"?!)

    We subsidize to some degree the cost of shipping on nearly every order, but free shipping isn’t an option when the total sale may only be $15 and it only fits in a medium flat rate box costing more than $10 to ship. The move to so-called "free shipping" is going to take a toll on smaller online retailers who don’t have the volume to negotiate ridiculous discounts with UPS and Fedex like Amazon, Zappos, or LL Bean can. What is wrong with charging what it costs to ship?

    I still come across plenty of online sellers charging handling fees and exorbitant shipping fees which is what caused the shipping backlash in the first place. But I’m not sure what started the thought that one should get stuff delivered to one’s house for free. If you want to buy something, you take time, you drive to the store and spend gas, etc. What is wrong with paying what it costs to get that product delivered to your doorstep?

  7. lsboggs December 20, 2011 Reply

    As far as the padded envelopes, if you call 1-800-610-8734, you can order in quantities of 100. there is also a prepaid version which we’re experimenting with. The first time I ordered (plain flat rate envelopes) they sent a sheet that listed the tracking codes of each envelope, then I ordered again and got flat rate envelopes with stamps! So no way to track! Not what I had in mind at all! Figured I’d wait until after the holidays to sort out.

  8. Mike June 15, 2012 Reply

    As the article suggests, USPS flat rating shipping can often save merchants quite a bit of money. Many merchants, like those using open source software platforms like Magento, are faced with the problem of accurately determining if their products fit into a given flat rate container at the time of checkout. The challenge is determining if the cart items actually fit into the given max weight and dimensions of the flat rate container.

    To get around this, some stores use flat rate or table rates to approximate the shipping costs on certain items they know will fit into a flat rate box, however, this can sometimes result in gross miscalculations, e.g., if a customer orders too many of a product or has a cart with a mix of products.

    A more reliable and accurate solution is to use the actual USPS rates from their API in conjunction with a "bin packing" solution. A store utilizing bin packing will be able to accurately determine if an order will fit into a particular shipping box or container. The downside is that bin packing can be pretty complicated, and most ecommerce platforms we have examined do not have this functionality built-in.

    But if you are willing to shell out the time and money to have a solution developed, or find a pre-packaged solution like the Magento Flat Rate Box extension (www.magentoflatrate.com), you could realize the kind of savings outlined in this article.

  9. liquidarchitecture July 30, 2012 Reply

    I’ve been doing ecommerce for over two years now. BEWARE of the USPS! I’ve lost hundreds of dollars of product and my reputation as a business has been tainted by USPS’s failure to deliver packages. Please note that extra add-on’s like insurance or signature confirmation will not allow to receive a refund back to the seller if you’ve used the priority mail option and USPS has failed to deliver your package even if it delivery confirmation says it’s been delivered. Only the Express mail option provides a tracking number and ability to file a claim. The USPS has not been able to deliver Express packages either. Beware. UPS and FedEx cost more but in the long run it is better for your reputation as a business in providing efficient service and includes a tracking number with every shipment which USPS does not except for Express packages only.

  10. katie wilcox September 10, 2013 Reply

    ok, so if I buy a box. I don’t have to pay to ship like the weight of the box. Buy a box put things in it mail it. Is that correct?

  11. Laura September 14, 2013 Reply

    Many times for me, the 2-3 days is more like 4-5, and there is no recourse. Nice that the box is included and that you have tracking, but there are no guarantees on time.

  12. C. M September 15, 2013 Reply

    I am harrassed by some USPS employees who are under the impression that Flat rate means the envelope should also be flat. However their advertising says, “If it fits it ships.”
    I am located in Stockton CA and I think the employees here need education on doing their own job to match their advertising.

  13. nemoskull October 28, 2013 Reply

    its a shame there is no flat rate anymore. at least at 85364.

  14. Teodora December 6, 2013 Reply

    My experience is that FedEx charges a lot less than the flat rate boxes at USPS for the same size and the people on the counter a much more polite than the gentlemen in USPS. I can see this guy goes postal.

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