Avoid dimensional weight (DIM) rates when shipping products, samples, or marketing materials. DIM rates are not always well understood, so here’s what you need to know to help reduce shipping costs and increase your profit.
What are DIM rates?
Dimensional weight rates are a means to price your packages based upon size, not weight. This takes into consideration how much space your package takes up on the providers’ delivery vehicles, which can end up costing you more for shipping.
If you use USPS, UPS, or FedEx, you’ve most likely been subject to DIM rates, whether you understood it or not. DIM rates allow carriers to bill you more for larger but lighter-weight packages. If you’re not cautious, it can drive up your shipping costs dramatically. This factor is an excellent reason to consider a fulfillment service for your shipping needs.
Partnering with a fulfillment center is often the most cost-efficient option for many businesses because shipping requires additional labor, supplies, and shipping knowledge. Using a fulfillment center allows companies to focus on what they specialize in, which usually does not include actually shipping their products.
Exactly how do you determine DIM rates?
If the resulting DIM weight is greater than your actual weight, the DIM weight becomes the weight you will pay for, otherwise known as your billable weight. This is often a higher cost than it would have been without considering the DIM.
The mathematical formula to calculate DIM weight for shipping rates is to multiply the length times the width times the height of a package using the longest point on each side. Next, you divide the cubic size of the package in inches by the DIM divisor. Professional fulfillment companies negotiate that DIM divisor multiplier to calculate the dimensional weight in pounds with shippers. Determining a DIM weight is difficult for most businesses to calculate and requires specialized industry knowledge. A package weighing 7 LBS can be ranked and charged at the 12 LB rate if the box is too large. Unfortunately, some products are excessively large compared to what they weigh and are subject to stiff DIM charges as a result.
What is the history of DIM rates?
It used to be that not all shipments were subject to DIM rates; however, that is not the case today. After remaining constant for the last few years, The DIM weight formula changed when COVID-19 hit and shipping rates surged. A good fulfillment company can help a business understand these rate changes and keep shipping costs down.
How do you stay clear of paying too much because of DIM rates?
One of the most crucial things you should be doing is using the proper packaging. You need to consider both the size of the product you’re shipping combined with how fragile it is. Items that have a higher risk of breakage require more room for proper padding, which increases the cost of shipping. Search for product packaging that permits adequate area for the needed padding, but no more. You are looking to minimize cost, but it shouldn’t be a surprise that unnecessarily large packaging can also contribute to a negative impression of waste with environmentally conscious consumers who might stop ordering for that reason alone.
How do I keep small package shipping expenses low?
Ensuring that you have chosen the most efficient size for packaging to prevent DIM pricing is one method to help reduce your delivery costs. Another technique is securing discount rates with the carriers; however, this is difficult for most businesses without an established historical relationship with the carriers and a high daily shipping volume. This factor makes it hard for medium and small-sized businesses to negotiate shipping rates by themselves. That’s why you need to use a fulfillment service with good negotiated rates.
A fulfillment center can provide this industry edge your business requires to ensure the lowest DIM shipping rates are applied or maybe not at all. They collaborate and partner with many carriers to access the lowest possible shipping cost combined with bulk discounts and savings typically reserved for high quantity shippers. Fulfillment centers can bundle multiple businesses products to receive lower rates than you can for your business.
If you frequently ship packages with USPS, UPS, or FedEx, consider getting help with your DIM shipping process. We are available to answer any of your questions to help create a cost-effective shipping process that makes sense for your company.
Because of our many years of fulfillment and printing experience, we can advise you on every step of the shipping process, including your printing needs.
Contact us today for a risk-free analysis of your shipping needs
Director of Fulfillment Services