What is Dim Weight?
Dim weight is a shipment pricing method being put in place by major carriers including FedEx, UPS and DHL that began taking effect in 2015 for packages shipped by ground service that are less than three cubic feet. Dim weight pricing is based on volume versus actual weight of shipments. It is calculated by determining the cubic size of a package – multiplying its length by width by height and dividing by 139, or in some cases 166.
What's driving dim weight policy changes are a growing number of packages from e-commerce shipments that are not being packed with regard to density of packing. This means that shipping containers are relatively large and light weight compared to the items being shipped inside the container, which equates to full delivery vehicles that aren't being used to maximum capacity. Here are the most recent shipping changes from major carriers as of September 30, 2016.
What You Need to Know about the Recent Dim Weight Policy Changes:
Major carriers including FedEx, DHL and UPS have recently implemented changes to their dimensional ("dim") weight pricing policies. Under the new policies, packages less than 3 cubic feet in volume (previously excluded from dimensional weight pricing), will now be subject to dimensional weight surcharges.
Under the new UPS rules, packages with a long side of 48″ are subject to a dimensional weight charge. The previous threshold was 60″.
Under the new FedEx rules, the surcharge will also apply to packages weighing more than 70 lbs, with a second-longest side of 30" or greater, or that are not fully encased in an outer shipping container, among other requirements.
Both FedEx and UPS have also raised their handling charge from $9 to $10.50.
Additional policy changes are scheduled to take effect in December 2016.
How Much Could Dim Weight Pricing Impact My Business?
For manufacturers and retailers, dim weight pricing changes could have significant financial and operational implications.
It's estimated that an additional $550 million a year will be spent on shipping costs as a result of dim weight pricing changes.
In May of 2015, Sealed Air surveyed 150+ customers and found that 89% were already seeing an increase in shipping prices due to the new dimensional weight policy-- 41% of whom saw increases of 10-20%.
Of those surveyed 83% indicated that dimensional weight pricing will impact at least 25% of their customers freight costs.
How Can I Combat The Impact of Dimensional Weight Pricing?
The good news is that by proactively optimizing their packaging solutions based on the new dimensional weight pricing policies, retailers and manufacturers can combat the financial impact of dimensional weight pricing on their business-- all while significantly improving product protection, sustainability and their customer's brand experience.
View the recorded webinar below for essential tips for reducing freight costs and combatting the impact of dim weight pricing on your business.
Download the dim weight fact sheet for quick facts on dimensional weight pricing and 10 tips for better packaging.
We're Ready to Help You Optimize Your Packaging for Dim Weight
Sealed Air offers multiple packaging solutions to help companies protect products and their bottom lines against the impact of dim weight prices.
Implementing an integrated set of Sealed Air solutions into your packaging operations can reduce cost by up to 30% and reduce unused void by up to 60%. Investing in Sealed Air solutions will lead to lower shipping costs in general, but the savings are especially acute when dimensional weight pricing is applicable.