The U.S. Postal Service is publicly signaling a strategic pivot under Postmaster General David Steiner. Rather than competing on volume, USPS is prioritizing revenue growth through rate increases and deliberately reducing package volume. This shift has direct implications for FBA sellers who rely on USPS for customer returns, small-item fulfillment, and business mail.
What This Means for Your Shipping Strategy
- Rate increases are coming — Steiner has indicated additional USPS rate hikes are necessary for “long-term sustainability,” likely affecting your shipping costs in the near term.
- Volume-based discounts may tighten — As USPS reduces package volume deliberately, sellers should expect fewer aggressive pricing incentives tied to high-volume commitments.
- Multi-carrier strategy becomes more important — This makes it even more critical to evaluate UPS, FedEx, and regional carrier alternatives for different shipment types and geographies.
- Returns logistics will shift — USPS return rates (already undercut by other carriers) may become less competitive, affecting your total cost of goods sold and customer acquisition ROI.
How Squatio helps
Squatio Optimize (PPC intelligence) can help you model margin impact as shipping costs rise. By analyzing your current PPC spend efficiency and profitability per unit, you’ll identify which products and keywords are most sensitive to logistics cost increases — letting you adjust bids, pricing, or sourcing strategy proactively rather than waiting until your quarterly P&L shows the damage.
Discussion
How are you currently sourcing carriers for customer returns and small-package shipments? Are you already diversifying away from USPS, or is the cost advantage still too significant to walk away from?
Source: https://www.practicalecommerce.com/usps-prioritizes-revenue-over-volume