Postal Service Announces Temporary Price Increase for Christmas Season

The Postal Service is planning a temporary price increase this fall for domestic commercial parcels.

The Postal Service said that it has filed notice of a temporary price increase to take effect in the fall.

The planned price increase would go into effect at 12:00AM Central time on October 18, 2020 and remain in place through Christmas until 12:00AM Central time December 27, 2020.

The increase was approved by the Governors of the Postal Service on August 6 and would raise prices on its commercial domestic competitive parcels – Priority Mail Express, Priority Mail, First-Class Package Service, Parcel Select, and Parcel Return Service.

The Postal Service said that the price increase is being done “in response to increased expenses and heightened demand for online shopping package volume due to the coronavirus pandemic and expected holiday ecommerce.” The Board of Governors also hopes that the temporary price hike will supply the agency with “much needed revenue.” How much additional revenue the price hike generates would be dependent on how many packages are shipped through the Postal Service in the timeframe that the temporary price hike is in effect.

Indeed, the Postal Service is no stranger to losing money as it has posted over a decade of net losses on its bottom line. The current situation surrounding the coronavirus has only exacerbated the agency’s losses as demand for first class mail has dwindled further. On the upside though, with more people shopping from home, revenue from its Shipping and Packages operation has shot up with the higher volume of packages being shipped. If that trend continues, a temporary price increase in what is already a busy time (the Christmas shopping season) for the Postal Service would likely help to bring in more revenue.

The Postal Service also said in its press release that the price increase is not expected to impact its retail customers. “This time-limited adjustment will increase prices for our commercial customers in line with competitive practices without impacting customers at the retail level. In doing this, the Postal Service is protecting the retail consumer during a vulnerable economic period while increasing prices on commercial volume during heightened volume levels,” read the press release.

The agency added that no structural changes are planned as part of the price increase.

What Happens Next?

The Postal Regulatory Commission will review the proposed price increase and if it signs off on it, the temporary price hike will go into effect on October 18 as outlined above.

About the Author

Ian Smith is one of the co-founders of He has over 20 years of combined experience in media and government services, having worked at two government contracting firms and an online news and web development company prior to his current role at FedSmith.