To say that shipping has changed over the past year is an understatement. Case in point: E-commerce purchases surged in 2020, creating 10 years’ worth of growth in just three months.
In response, carriers have had to become even more efficient in how they move packages, sometimes leading to increased costs for shippers. Package dimensions are a prime example of these new considerations.
Many shippers don’t understand when they’ll be charged for a package’s dimensional weight or the dimensional factors that trigger surcharges. But it’s absolutely crucial to understand how a package’s dimensions affect your shipping cost.
What is dimensional weight (aka DIM weight)?
Dimensional weight is based on the measurements of a package:
(L x W x H) / DIM divisor
The DIM divisor for 2021 is 139. Your carrier will electronically scan your package to determine its dimensions and calculate the DIM weight, rounding up to the next pound. If the DIM weight is higher than its actual weight, you’ll pay based on the DIM weight. This makes it absolutely vital to choose the right packaging.
Choosing packaging that’s unnecessarily large will make your package more costly to ship. On the other hand, if you overpack a box, causing it to bulge beyond its original dimensions, the carrier’s scanner will measure larger dimensions, making the package cost more than you were expecting.
What is the dimensional Additional Handling surcharge?
In 2021, the Additional Handling – Dimension surcharge will cost $16 (up from $15 in 2020) and kick in under three conditions, the last of which is new and might catch shippers by surprise. The surcharge will apply if a package is:
- Longer than 48” on the longest side
- Longer than 30” on the second-longest side
- More than 105” in length and girth combined (A package’s girth is two times its width plus two times its height.)
An example of how dimensions affect your shipping costs
To see how these dimensional costs might come into play, let’s look at a 20” x 20” x 25” package with an actual weight of 23 lbs.
Based on the formula above, the dimensional weight will be 72 lbs, and because that’s greater than its actual weight of 23 lbs, you’ll be charged for the dimensional weight, which is clearly much higher and, in turn, more costly.
What about Additional Handling costs? It’s not longer than 48” on the longest side or 30” on the second-longest side, but don’t forget that new trigger for 2021 — length plus girth. Let’s calculate.
Its length is 20”. Its girth is 90”. Remember, that’s [(2 x 20”) plus (2 x 25”)].
So the length and girth combined are 110”, adding $16 to the cost of your package. If you were estimating the cost based on your package’s actual weight and weren’t aware of the new surcharge trigger, you’ve vastly underestimated the cost of that package.
Now take that underestimation times the number of packages you ship each week or month. That’s going to add up fast.
Crunch the numbers
We didn’t warn you there would be so much math in this blog post, did we? There’s so much more than many shippers expect when it comes to understanding your shipping costs. Being able to model the impact of dimensions and packaging, among many other factors, is important to staying on budget and being able to offer your customers affordable or even free shipping.
Don’t let unexpected new costs bust your budget in 2021. Understand your data from every angle so that you can stay ahead of costs and any surprises that might pop up. Having a consistent, normalized way to visualize your shipping trends and spend will make it easier to manage your costs.
Looking for more ways to get a handle on shipping costs in 2021? Check out our ebook, 2021 General Rate Increase: A Year Like No Other for three mistakes you don’t want to make when it comes to shipping.