Analysis: How New USPS Fees Make Shipping More Expensive on eBay and Other Marketplaces

With the new USPS Non-Standard Fees now in effect on larger boxes, I took a look at how this will impact eBay sellers using eBay Labels as well as online merchants and sellers on other marketplaces.

First, let’s look at what changed on April 3 when these new fees went into effect.

Non-Standard Fees: These new fees will apply to Priority Mail, Priority Mail Express, Parcel Select, First Class Package Service, and USPS Retail Ground for manual sorting when the dimensions of the package exceed sortation requirements.

• Package Length over 22″ – $4.00
• Package Length over 30″ – $15.00
• Package over 2 cu. ft. – $15.00

Dimension Non-Compliance Fees: This new $1.50 fee on Priority Mail, Priority Mail Express, and Parcel Select services will apply to shipments that are greater than one cubic foot or with a length longer than 22″ if the shipper did not provide dimensions or if the dimensions are incorrect in the electronic manifest file.

I like how USPS calls large boxes “non-standard” boxes. Yet, those sizes are really not all that uncommon and when you see the examples below, they can make some shipments very expensive with the Postal Service.

The second new fee, the Dimension Non-Compliance Fee’s purpose is to enforce the new Non-Standard Fees but it will also impact box sizes that are not part of the new fee. I will explain that as well.

For my analysis, the US Postal Service pricing I am using is based on USPS Commercial Plus rates which are the most common discount rates offered by eBay, Etsy, and other shipping platforms.

That rate is a deeper discount than what is available through USPS Click-N-Ship and while the new fees apply to Click-N-Ship labels as well, that is more of a retail product and I did not include them here.

FedEx and UPS rates are a bit of a minor challenge as there can be significant differences between shipping platforms. Some higher volume sellers may also have their own negotiated rates with these carriers.

For my comparisons, I used eBay’s discounted rates as many eSeller365 readers are eBay sellers and every eBay seller has access to these discounted rates offered on the marketplace.

The base weight I used is 2 lbs. I picked that weight because every carrier now adjusts rates based on dimensions on lighter packages. I wanted all my examples to be based on dimensional weight as that effectively sets the minimum rate for that size box.

Let me explain.

To calculate the dimensional weight of a box we have to use a formula. Note: Formula varies by carrier and always round up each dimension first. So if you have a measurement of 10.25”, use 11” for your calculations.

• H = Height
• L = Length
• W = Width

USPS: L x H x W / 166 = dimensional weight

UPS and FedEx: L x H x W / 139 = dimensional weight on discounted rates such as those offered by eBay and other shipping platforms and marketplaces*

* UPS at its retail locations uses 166 as the divisor instead of 139, but the base rate is much more expensive. FedEx uses 139 as its divisor for all discounted and retail rates.

So, to clarify, if the dimensional weight calculated is more than the actual package weight, carriers will use the dimensional weight for rate calculations. Although that can be subject to thresholds I will point out later as well.

Packages with an actual weight that is more than the dimensional weight will always be charged on the actual weight. But this is important, the new USPS Non-Standard Fees will still apply to these packages.

I think you can follow why I picked the dimensional weight as the base rate for the box size as it represents the lowest possible rate that could be charged for that sized box.

Now, as you know, shipping rates vary based on distance. I used Miami (33101) as the origin zip code and Seattle (98170) as the destination zip code.

The reason I picked those cities is that I feel most sellers impacted by this new USPS Non-Standard Fees either offer free or fixed price (subsidized) shipping and by using a long-distance shipment, it provides a worst-case scenario example without getting into rural or remote shipping surcharges often imposed by UPS and FedEx.

That is actually an area where USPS continues to have an advantage over UPS and FedEx as the Postal Service charges the same rate to Seattle, WA as it does to a small town in the northeastern corner of Washington State away from major cities like Frontier, WA.

What my analysis also shows is that ever since eBay added UPS to its platform in 2020, UPS rates on eBay have been really competitive with USPS already and are typically substantially lower than eBay’s discounted FedEx rates.

For my analysis, I compared four service levels most likely to be considered by sellers on larger packages that generally meet customer delivery expectations.

• USPS Parcel Select
• USPS Priority Mail
• UPS Ground
• FedEx Ground

I didn’t want to get into special rates such as Media Mail, FedEx Economy Ground, or UPS SurePost as they either have additional mailing restrictions or do not offer the best service levels.

And I also didn’t want to clutter the analysis with Express rates as they are usually not the primary shipping choice for most orders and rarely are part of any discounted or free shipping offer.

However, the new USPS Non-Standard fees do apply to Priority Mail Express rates as well.

So, let’s take a look at how shipping with USPS changed now for eBay sellers, other marketplace sellers, and online merchants that routinely ship larger boxes.

Box Size: 12 x 12 x 12

• Cubic Feet: 1.00
• USPS Parcel Select: $10.85 – no change
• USPS Priority Mail: $12.66 – no change
• UPS Ground: $11.35
• FedEx Ground: $20.81

Box Size: 13 x 12 x 12

• Cubic Feet: 1.08
• USPS Parcel Select: $20.26 – no change
• USPS Priority Mail: $41.10 – no change
• UPS Ground: $19.86
• FedEx Ground: $21.58

The reason I picked the 13 x 12 x 12 box here is to highlight how important one inch can be when your box size is right around a cubic foot.

To calculate the cubic dimension of a box, use this formula:

L x H x W / 1728 = cubic dimension

Again as with the dimensional weight formula, always round up each dimension first. So if you have a measurement of 10.25”, use 11” for your calculations.

No matter where you purchase your USPS labels, eBay, Etsy, or another shipping platform, the Postal Service does not use dimensional weight if the cubic dimension of the box is 1.00 or less.

In this comparison, you can see that having a box that is one inch longer results in a huge difference with USPS, but also with UPS when using eBay Labels.

I tested this with other sized boxes that were just at or close to 1 cubic foot – and those that went just a tiny bit over – and found the same big difference with USPS across all shipping platforms as well as UPS rates on eBay.

Box Size: 36 x 4 x 4

• Cubic Feet: 0.33
• USPS Parcel Select: $25.85 – $15 Non-Standard Fee now in effect, used to be $10.85
• USPS Priority Mail: $27.66 – $15 Non-Standard Fee now in effect, used to be $12.66
• UPS Ground: $11.35
• FedEx Ground: $13.91

UPS and FedEx appear to have become far more competitive choices now for this size box which may be a typical choice for items like posters, golf clubs, or baseball bats.

Box Size: 24 x 8 x 8

• Cubic Feet: 0.89
• USPS Parcel Select: $14.85 – $4 Non-Standard Fee now in effect, used to be $10.85
• USPS Priority Mail: $16.66 – $4 Non-Standard Fee now in effect, used to be $12.66 
• UPS Ground: $11.35
• FedEx Ground: $19.85

Similar to the previous example. UPS has become more competitive on eBay, but as you can see this also highlights the big discount eBay negotiated for sellers with UPS as FedEx is clearly way more expensive.

Box Size: 24 x 12 x 12

• Cubic Feet: 2.00
• USPS Parcel Select: $39.17 – $4 Non-Standard Fee now in effect, used to be $35.17
• USPS Priority Mail: $64.31 – $4 Non-Standard Fee now in effect, used to be $60.31 
• UPS Ground: $30.41
• FedEx Ground: $30.96

Adding 4 inches on two dimensions over the previous size has a huge impact on the shipping cost over the previous size box. The package size becomes much larger going from 0.89 cu. ft. on the 24 x 8 x 8 to 2.00 cu. ft. with the 24 x 12 x 12 box.

But let’s show another example by increasing one dimension by only one inch and what difference that makes.

Box Size: 24 x 13 x 12

• Cubic Feet: 2.17
• USPS Parcel Select: $61.51 – $15 Non-Standard Fee now in effect, used to be $46.51
• USPS Priority Mail: $86.50 – $15 Non-Standard Fee now in effect, used to be $71.50
• UPS Ground: $32.99
• FedEx Ground: $33.23

Woah, even bigger disparity now because this shows how USPS’s new 2 cu. ft. rule comes into play and adds $15 to the shipping cost of the package, making USPS not a good choice here.

UPS and FedEx here are now the clear winners, even if you end up with a rural remote area surcharge.

Okay, for kicks, the same box to Frontier, WA versus Seattle, WA is $35.24 on UPS and $40.58 on FedEx with eBay Labels which just reconfirms how eBay’s UPS rates are much better than its FedEx rates, even to rural areas.

Box Size: 18 x 12 x 10

• Cubic Feet: 1.25
• USPS Parcel Select: $23.21
• USPS Priority Mail: $45.44
• UPS Ground: $22.54
• FedEx Ground: $23.93

I consider this kind of a medium-sized box. Both UPS and FedEx on eBay are very competitive by comparison to USPS Priority Mail even with the box size not triggering the new USPS Non-Standard Fees.

However, if you send a box like this that is over 1 cu. ft., you need to be aware that USPS will charge you a $1.50 penalty fee if you do not provide the dimensions or if you provide incorrect dimensions.

As I mentioned earlier and highlighted in bold, the new Dimension Non-Compliance Fee of $1.50 can kick in on smaller packages if they are at least 1 cu. ft. in size.

And keep in mind, that if you are off on your dimensions, it’s not only the $1.50 but also the difference in rate between the dimension you provided and the actual one measured by USPS’s electronic scanners.

Box Size: 25 x 12 x 3

• Cubic Feet: 0.52
• USPS Parcel Select: $14.85 – $4 Non-Standard Fee now in effect, used to be $10.85
• USPS Priority Mail: $16.66 – $4 Non-Standard Fee now in effect, used to be $12.66
• UPS Ground: $11.35
• FedEx Ground: $15.46

Why did I pick this box size? Well, you may remember that USPS discontinued the Priority Mail Flat Rate Game Box recently and I have seen a lot of unhappy comments online about USPS discontinuing this box.

While it may have seemed like a specialty box, it probably was used by many shippers for other items. That is why I included it here.

The bottom line here is that USPS really doesn’t seem to want to handle a box of this size. The new $4 Non-Standard Fee makes UPS a competitive choice on eBay now.

Conclusion About New USPS Rates

USPS has been making adjustments to its package price for years now. The days of just sending a package with the Postal Service and not worrying about dimensions are over.

These new large package fees, or Non-Standard Fees as USPS calls them, make even some typical package sizes even more expensive now.

While USPS has upgraded its network to handle more packages, it clearly isn’t efficient at handling some tall or larger package sizes, suggesting that much of the new sorting equipment is designed for smaller boxes.

But it’s not just the sorting equipment, even their new NextGen delivery vehicles are not that big when compared to what UPS and FedEx use.

So, the Postal Service will make shippers pay for manually sorting these tall or larger packages with the new fees which may also drive more shippers to consider other options like UPS and FedEx.

But since UPS and FedEx drop-off locations are often not as convenient as US Post Office retail locations for sellers in rural and smaller communities, it will impact those sellers more as they may end up paying the new USPS fees to avoid driving long distances to the nearest UPS or FedEx drop-off location.

I used eBay’s UPS and FedEx rates for my comparison and I can only suggest that no matter where you sell or which shipping platform you use – now is a good time to evaluate your box sizes as well as carrier choices – and make appropriate decisions that are best for your business.

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