Are You Using the Right Packaging for DIM Weight Pricing?

July 20, 2021 by Amware Fulfillment

Though dimensional weight, or DIM weight, is hardly a new pricing model, it remains a hidden profit killer for pick and pack fulfillment operations that don’t properly manage it. Misunderstanding how parcel carriers determine shipping rates can inflate your shipping costs 5–15%, so it’s imperative to choose your most cost-effective packaging option. 

dim-weightCarriers use DIM weight to make sure they don’t lose money shipping large, lightweight packages. For example, an oversized pillow may weight very little. But shipping it in a large box would take up a lot of room on a truck. If the carrier charged only for the weight of the pillow, it couldn’t turn a profit on that particular shipment.

DIM weight uses a mathematical formula to account for the volume of large, lightweight packages. DIM weight formulas account for the package’s density, essentially determining how much a package of that particular size should weigh. The formula for DIM weight is the parcel’s volume divided by a particular divisor. The divisors vary by carrier and service.

The USPS uses a standard divisor of 166. As an example, a 10x10x10 packaging would have a volume of 1,000. 1,000 ÷ 166 = 6.02. Carriers always round up to the nearest whole number, so our example package has a dimensional weight of seven pounds.

Carriers determine what they will charge based on the higher of the parcel’s actual weight or DIM weight. To benefit from the DIM weight pricing model, you should use ideal packaging for each item you ship.

 

Beat DIM Weight Pricing with Better Packaging

Some eCommerce shippers will customize packaging solutions to shave every last cent out of DIM weight pricing, but that isn’t always necessary. The following packaging tips will ensure that dimensional weight carrier pricing doesn’t get the best of you.

1. Start right-sizing your shipping boxes

When your boxes are too big, you will pay more to ship that extra air. Using only one or two box sizes for products of a wide range of sizes means you’re probably overspending because of DIM weight pricing. Conversely, a healthy mix of standard box sizes will eliminate the need for unnecessary void fill materials, reducing actual weight while also lowering DIM weight through the use of correctly sized packaging.

Consider that hypothetical 10x10x10 box we shipped with USPS above, with its DIM weight of seven pounds. Shipping that box into the first shipping zone with USPS Priority Mail 1-Day would cost $12.40. Now, imagine you could trim just one inch off each dimension of the box without losing protection or effectiveness. A 9x9x9 box would have a DIM weight of five pounds at a same-zone shipping cost of $10.60. That’s a savings of $1.80 per package. Apply that 15% savings across your total parcel shipping volume and you’re talking about a significant savings.

2. Audit your freight bills

Parcel carriers employ automated scanners to determine box dimensions, and sometimes those scanners get it wrong. When you see language such as “we calculated charges based on a DIM weight of…,” verify that the automated DIM weight measurements were correct. Providing actual parcel dimensions for each shipment will help avoid inaccurate measurements or costly rounding on the carrier side.

3. Use alternative shipping packaging wherever possible

Polybags minimize package size and can be a very economical alternative to boxes for small, durable, lightweight products. Given that polybags will often weigh several ounces less than a box, they also help push down actual weight. In some scenarios, polybags have resulted in six-figure savings over shipping boxes.

Of note, some carriers exempt envelopes and bubble mailers smaller than 12 x 15 inches and less than ¾-inch thick from DIM weight pricing. As a result, this packaging may generate substantial savings compared to boxes.

4. Use a minimum amount of dunnage

Warehouse associates regularly overestimate the amount of dunnage required to protect an item in transit, which leads to oversizing of boxes and higher DIM weights and actual weights. Replacing bulkier void fill packaging — such as bubble wrap, Kraft paper, or packaging peanuts — with air pillows can reduce space requirements and actual weight for your parcels.

5. Consider the use of hybrid parcel services

The major private parcel carriers offer hybrid services in conjunction with USPS, where USPS handles last-mile delivery of the parcel. Leveraging this capability through services like FedEx SmartPost or UPS SurePost may soften the overall impact of DIM weight costs since USPS often uses a higher divisor that results in lower overall DIM weight rates.

Attending to the above DIM weight details can cut your annual parcel shipping costs 5–15%. For more advice on reducing your parcel spend, check out Amware Fulfillment’s eBook, 10 Ways to Reduce Parcel Shipping Costs.

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Filed Under: Parcel Shipping for eCommerce