Unboxing the Trends: USPS Fuel Surcharges, FedEx 2-Hour Delivery, and the Rise of Amazon Shipping With Tim Ranagan and Lori Boyer From EasyPost - Unboxing Logistics Ep. 86

Hello, and welcome to another episode of Unboxing the Trends. I'm your host, Tim Ranagan, and I have with me again today, our host of the Unboxing Logistics podcast, Lori Boyer. Lori, how are you doing today? Oh, I am doing so good, Tim.

So good. Well, Lori, I'm excited to jump into our discussion today. We have some really interesting news coming out of USPS. It looks like they are introducing their first ever fuel surcharge.

I'm really interested to get your take on this. So go ahead and tell us what you know about this first ever charge from the United States Postal Service. Tim it's, it's a big deal. I mean.

They've never had a fuel surcharge before, ever. So I don't think any of our viewers out there are gonna be excited. More surcharges. We're seeing that across the board.

We're seeing huge numbers of surcharges in general. Costs are up, and that goes for carriers as well. Obviously we know what the situation in the Middle East, we've got, you know, fuel, fuel prices rising as well. But I do think it's, this is kind of a big signal.

Just with all of the different rising costs they say it's a temporary adjustment, you know, to, to match market conditions. And I hope it is. But I, I guess I just wouldn't be surprised to see a few more surcharges. It's always been, USPS has always been our sort of predictable low cost model.

The past, I feel like they've always sort of absorbed the volatility rather than kind of passing it on like other, you know, for-profit carriers have. But we're at the point where they're really struggling with those costs. So we are seeing some more of those costs being carried over to the shippers in general. And so I wouldn't be surprised to see that continue, sadly.

That's interesting. I'm curious, do you think that some of the other major carriers will follow suit? Have you read anything about that? I mean, they all have big fuel surcharges already, but we're definitely seeing rising numbers in surcharges into 2026 so far.

Interesting. Across the board for all the major carriers. We're seeing a big rise. And I think some of it isn't just fuel, but a lot of the other charges.

All of you shippers now, I hear it from you all the time. Surprising charges that come out, sort of ticky tacky here and there. Things that pop up. And so I think because costs are not just high, but they are dynamic, like they're kind of shifting a lot with different geopolitical and economic issues that surcharges are con, continue to be a big pain point for our, most of our, our audience here.

For any of our listeners out there, this is, it's always a good time to reach out to your reps at these carriers. If you use it like a shipping aggregate, like EasyPost, reach out to your customer success rep. It's, it's good to, these are some of the windfalls that happen when economics kind of come into play with shipping and logistics. So it's always good to reach out to your account managers, account reps, customer success reps, and see how these potential changes could affect your bottom line, your shipping and logistics, the pricing on your, on your labels.

And so it's good to know that before we head down into peak season, towards the end of the year. Oh my word, we're gonna talk peak already. Holy cow. I guess it's April.

You are, you are absolutely right. Keep an eye on those costs is gonna be super, super critical this year. Yeah, it always is. But I just think this year even more than ever.

So next question, Lori, we're gonna jump over to FedEx, the FedEx side of things. They just launched a same day service with two hour delivery windows, which seems incredible. Are we. Are we really, so I know Amazon has done this a little bit with same day delivery in, in certain cities.

Are, are we really heading towards this as kind of the new norm for shipping and logistics? It seems like with a, a major carrier announcing a service level like this, maybe some of 'em are gonna follow suit. What does that mean for the industry? Great, great question, Tim.

This is one that I'm actually a little bit passionate about for you shippers out there. So yes, FedEx did just announce that they have say day, same day service within a two hour delivery window, which is great. I think what you were referring to as well, I think it was a week or two ago, Amazon announced that they have one hour and three hour delivery, which is amazing. So you could order something and get it within one to three hours in a lot of the city.

What we are seeing though, is that push a little bit to faster and faster and faster service. But, this is a big but. I do not think that that necessarily means you need to change your shipping approach. Okay, so just because the big players are doing it, and now if you have access to it, if you're using FedEx, if you're using some of the Amazon shipping carriers who offer that, it's okay.

But this is a big player thing. And I feel like maybe if you're a smaller shipper or even a medium sized shipper, if you're thinking, oh, I gotta keep up, I gotta keep up, it may end up being way more money than is worth it. Because we're also seeing data, Tim, that customers are not necessarily pushing speed as much as we sometimes think, when it comes to reliability. So almost more than anything, they're wanting to know exactly when they're gonna receive their packages.

Don't get me wrong, we all like stuff fast. I'm not saying that there aren't people who like things fast. But just I guess do an a deep dive into your particular customer base. And make sure that that speed is what they really want.

And maybe what they're willing to pay for it. If, Amazon's actually charging for this, which I think is really interesting. So you'll have to pay. So I think if you're a Prime member, you have to pay $10 to get the delivery.

It's expensive to get things really, really fast. So a lot of brands don't have the margins the order density or maybe. Yeah. Obviously the infrastructure, you know, things like that for a two hour delivery.

And as well, even same day delivery. So, I guess my thought is don't try to necessarily do it just 'cause Amazon, FedEx, just because they're offering those kind of things doesn't necessarily mean that that's what your customers want. Yeah, that's great advice, Lori. Well, let's, let's switch gears over to Amazon a little bit.

Right. It seems like some of the changes maybe that FedEx are, are, are implementing, are more for larger cities, more densely populated areas, but Amazon we're seeing them expand a faster delivery model into rural areas, which seems very fascinating. What, what is, what are they really doing here? What's going on with Amazon shipping in these rural destinations?

Yeah, so rural's interesting. You know, it is, as almost everyone knows, the hardest, the most expensive part of an it. It's why carriers have always kind of leaned toward the USPS to kind of handle these areas. Amazon is attacking this.

And Amazon's attacking hard. They're investing in 2026, $4 billion to their rural delivery network. They wanna triple the size of it, and they want to add at least 4,000 towns and communities across the US. So they're going big for the rural area.

It's, again, I think it's not even just about fast delivery, but it's about just demand in places that maybe have been underserved in the past. I know they're opening some new, I was talking to someone recently who talked about some new last mile facilities. They're using AI more and more and more to get their inventory closer to their customers. Yeah, they're doing a huge amount.

Amazon has always been the leader kind of in industry cutting through things. And in this case it is interesting as the USPS is struggling a little bit to see Amazon stepping up and kind of diving, dipping their toes into it there. So yeah, we're, we're seeing a lot more in the rural area with Amazon. And Amazon shipping in general has just, Amazon Shipping as a carrier has become really a really interesting take as well.

And, and maybe we can talk about that, but Amazon shipping as a carrier is slightly different than just Amazon themselves. For sure. That's that's interesting to note. You know, it seems like you, you wonder what kind of impact this may have on some of the regional carriers, right?

Where those were the resources to reach into some of these more rural destinations. It's interesting to see a nationwide carrier kind of dipping their toes into making rural deliveries a possibility. So interesting to see. Really, really fun times in the industry.

Really interesting. Yeah, for sure. Lots of carrier stuff going on. Yeah.

Okay. Well, we're gonna jump over. I've got a question for you. We've, we've seen a lot of kind of EasyPost users, they're starting to move their volume over to Amazon Shipping.

Right. We talked a little bit about some things that Amazon is doing to diversify their, their offering, right? Their delivery offerings to their customers. What are you seeing here with this kind of shift away from maybe some of these traditional big four carriers to a solution, a carrier solution like Amazon?

Yeah, so Amazon Shipping, for those of you who don't know, is Amazon's carrier arm of their company. So Amazon, of course, has their own shipping, but they've opened it up to ecommerce and other shippers who want to kind of tap into that infrastructure and let people use that and, and as a carrier. So as you kind of mentioned, they've been sort of almost like a, one of our regional carriers, they've been kind of smaller. They're definitely not promoting themselves as a, we're gonna ship everything, but in certain lanes and for certain products and in certain areas, Amazon Shipping is an option in your multi-carrier mix.

You know, if you, if you talk with me too long, you'll know how much I am passionate about having a good, strong risk strategy around having multiple carriers. And Amazon shipping launched, I think maybe 18 months ago now, Tim. And they, we're seeing a lot. I think you mentioned our customers specifically.

We're seeing a lot of movement to Amazon Shipping. Brands are actively testing it out. What's one of the interesting things and where a lot of our volume here at EasyPost is getting driven to Amazon shipping is because of our Luma AI product. Our Luma AI can go in and what it does is it compares all of the carriers across, you know, lanes, across speed, when do you wanna have it there?

All of those different things. And we'll tell you what is the best option for you based on what you need. So if you're looking for the most affordable option, or if you're looking for the most, you know, the fastest service or the most reliable or whatever you want Luma AI has taken billions of shipments and compared and, and crossed examined so that people can see what would be their option. This is where our push towards Amazon shipping, where we're seeing that with customers.

In our data, that's what the data is showing that a lot of times Amazon Shipping is is the best option. It's strong. Amazon's network is strong. It's hard to ignore.

So, yeah, I think that it's just the data, data data shows that Amazon Shipping is becoming a really big player in the carrier industry, and boy, within 18 months it's really fast. Yeah. That's fascinating. Well, Lori, this is, you've talked about, about some really interesting things with carriers, almost from top to bottom.

Touching on USPS, FedEx, Amazon Shipping. I, I'm curious if you have any final thoughts, if anything kind of stuck out to you over the last maybe 30 days or so that's happening in our industry that you think our listeners should know about? Yeah, I do. I, we are here talking carriers a lot today and because there have been different carrier news and I'm getting a lot of questions about using multiple carriers.

The best way, the best timing, and I think for me, if it were me and I was shipping here in the next 30 days, and even moving forward, I wouldn't be paying attention a lot to what is happening with one specific carrier. I would be more worried about how am I making my decisions around carriers. That's what I see breaking. I see that people have, they may be keeping an eye on things, but unless you are actively trying to figure out and, and make the right decisions, you're gonna be behind.

And I, the industry is just crazy. I mean, it's always crazy, but right now we are seeing so many fluctuations and shifts that it feels like the news one day can be completely different the next day. And I think right now it's more important than ever that you are using tools, that you're doing things to help make sure that you, that you just have good visibility into what's happening with your carriers. So for me that's a how, ask yourself, am I making good decisions?

Do I know if I'm making good decisions? Do I know if I'm overpaying? Can I change volume quickly? Ask yourself those questions, and if you don't have the right answers to them, then you need to start looking.

There's technology, there are solutions. Of course, there's EasyPost, I love EasyPost, and there's others as well. So just don't leave yourself in a place where you're needing to make decisions manually. That's great advice, Lori.

The theme of this episode is, do you know if your carrier mix is going to work for you? So love that. Lori, thank you so much for all of your thoughts and comments on today's episode. For all of our listeners out there, this has been another episode of Unboxing the Trends.

If you would like to view all of our previous episodes, you can do so at EasyPost.com/podcast. We'd also love to hear any comments you might have, so please drop a comment down in the thread below. Until next time, we'll see you in the next one.

Thanks. Happy shipping everybody.