Volume 42: 2025 GRI Predictions - What We Expect & How to Prepare
Volume 42 Breakdown:?
- Last Week's Top Parcel Power Plays
- KPI of the Week: # of Delivery Area Surcharges
- The 2025 General Rate Increase (GRI) is Coming… What We Expect and How to Prepare
Every week we’re catching you up on the top industry news stories from the previous week. Let’s get into it:
#1 Carrier Mixes Shuffling After Pitney Bowes GEC Shutdown
The closure of Pitney Bowes’ Global Ecommerce unit has presented challenges to clients looking for alternatives for their volume.
Many shippers used the service because it’s postal consolidation structure made it a very low-cost option. Former GEC customers may have a tough time finding alternatives that match that cost-effectiveness, but they’ll benefit from the fact that the market strongly favors shippers right now.
Other postal consolidators, like DHL eCommerce or OSM worldwide, could be a simple alternative based on the similar structure. However, the USPS recently hiked rates for postal consolidation services, so the costs for new clients might not be as low as they once were. Another option is working directly with the USPS and their Ground Advantage service.
The scramble to find a carrier to take on GEC’s volume shows the value of a diversified, multi-carrier mix.?
“The shippers that had two or more options set up for every ZIP code where their customers are located, they’re feeling good right now,†said Timur Eligulashvili, president of Logistics Remix.
#2 USPS Proposes Rural Mail Slowdown
The USPS has proposed a plan that would allow for a slowdown of rural mail deliveries. The plan is designed to better fit their overhauled network, which relies more on ground transportation, by adjusting pickup and dropoff times between processing facilities and local post offices.
The plan, if enacted, is projected to save $3 billion.
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The changes wouldn’t take affect until 2025, so peak season volumes wouldn’t be affected. Additionally, Ground Advantage packages would still be delivered in no more than five days.
The plan is yet to be submitted to the Postal Regulatory Commission for approval or denial.
What is # of Delivery Area Surcharges?
Delivery Area Surcharges are applied by the carriers when you ship to “less-populated†or rural areas. They do this to offset their cost of the extra miles put on a truck to access these zip codes. # of Delivery Area Surcharges refers to the total number of these types of charges you are billed by your carrier.?
Why is tracking # of Delivery Area Surcharges important?
It is important to track the # of Delivery Area Surcharges you incur, as they add up over time, especially if you are repeatedly shipping to the same locations. If you find yourself getting charged for these often, there are actions you can take. One of these includes using USPS instead of FedEx and UPS because USPS does not charge delivery area or residential surcharges. You could also look at using a regional carrier.
2025 GRI Predictions - What We Expect & How to Prepare?
The 2025 GRI will be here before we know it… So, we sat down with @Jeremy Lee, VP of Sales at Sifted, to discuss his expert predictions for this year.?
It's no surprise that he predicts many factors will play a role in the rate increase: Underwhelming carrier earnings reports, inflation, consumer spending habits, and more.?
But just how high will the rates be? Check out our Q&A article for his insights.