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Surprised your shipping costs are going up? New DIM weight rules are likely to blame

by TaxJar November 6, 2023

This post was written by our friends at Red Stag Fulfillment. Please note: This blog was originally published in 20218. It’s since been updated for accuracy and comprehensiveness.

When you think of storing your products on a shelf in your warehouse or storefront, you must think about both how much each product weighs and how much space it takes up, or you could end up with products overflowing onto the floor and broken shelves.

Carriers like FedEx and UPS have to think of the same thing for their warehouses and trucks, to avoid damage to your goods as they head off to your customers. In 2015, to make it easier for these carriers to keep these dimensions in mind and charge you the right amount to be able to fit the most parcels, they turned to a dimensional weight, also called the DIM weight.

The DIM weight comes with a bit of extra math and, unfortunately, that math is a bit more complex. For the first time, UPS and FedEx are using different methods to calculate the DIM weight which means it may be cheaper to send some of your goods via UPS, while FedEx will be a cheaper option for others.

Let’s dive into the reason behind DIM weight, the changes in today’s formulas, and how you can easily estimate cost with each carrier to see where you’ll get the better deal.

Why does DIM weight exist?

Before 2015, carriers followed a very simple formula for calculating: you paid more the heavier your products were and the farther they traveled.

It’s an incredibly straightforward way to understand what you’ll need to pay, which made budgeting for businesses great. The problem is that it really focuses on weight, but the biggest limiting factor in most trucks and delivery vehicles is actually the space they have to stack and place packages.

Red Stag Fulfillment DIM Weight

Before 2017, the DIM weight was calculated by multiplying length times width times height (L x W x H), divided by the DIM Factor that both carriers set as 139.

DIM weight was the answer for carriers to charge based on this limited space for lighter goods. But, carriers also continued to use their old rates to check prices based on actual weight, and you get charged whichever is higher.

DIM Factor changes mean different prices

The substantial change this year is that the DIM factor is no longer the same for each carrier. So, you’ll need to fire up that calculator app on your smartphone to make sure you’re picking the best carrier for your parcels.

Here’s what you should know about the two biggest carriers who have made changes.

FedEx drops its DIM factor

FedEx has decreased its DIM factor from 166 down to 139. Because this is the number you divide your box’s dimensions by, it means you’ll be getting a larger DIM weight than before.

Let’s look at a 10” x 10” x 10” cube package and assume that it weighs three (3) pounds. Using the 2016 DIM weight formula, we’d get (10x10x10)/166, which would be rounded up to 7 pounds. This is greater than the three actual pounds, so you’ll be charged for 7 pounds.

Red Stag Fulfillment FedEx

If you sent the same box and product this month, you’d get (10 x 10 x 10)/139, which would be rounded up to 8 pounds. So, the same package gets a 14% increase in DIM weight.

This year, FedEx is also using new billing rates for its zones (how far your package is shipped) and has an advantage for goods being shipped farther, in zones five through eight.

UPS adopts two DIM factors

UPS is changing its DIM factors as well as base billing rates, and you’ll need to pay close attention to your package size.

For any package smaller than or equal to 1,728 cubic inches — think a 12” x 12” x 12” cube-shaped box — UPS is sticking to the older DIM factor of 166. If your package is larger, then UPS will apply a DIM factor of 139, moving it in-line with FedEx.

UPS DIM Weight

So, our 10” x 10” x 10” package would have the same DIM weight both last year and this year. However, if we consider a box that is 12” x 12” x 14”, then the shift from 166 last year to 139 this year changes the box from a DIM weight of 13 pounds to 15 pounds.

The company is also changing its base billing rates, giving it a price advantage for closer shipments sent to zones 2, 3 and 4.

Double check your work

Like any business practice where the foundation changes, there are going to be sometimes where you’re trying to estimate your shipping costs and automatically revert to old methods or use tools that haven’t been updated.

Keep your budget on track by going through and verifying weights and dimensions, so you are properly estimating costs and projecting what changes you’ll need to make for your forecasts. You can also check your work by using the latest DIM weight calculators that specifically address the changes in weight as well as delivery zone costs.

Give your business the reliability it needs by truly understanding the cost of doing business.

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