USPS' Rate Reductions May Pose a Threat to UPS and FedEx's Market Share

The Postal Regulatory Commission recently approved rate changes proposed by the U.S. Postal Service for its Priority Mail Product, which may prove to be a threat for United Parcel Service and FedEx's e-commerce package business. These changes, which will be effective from Sept. 7, 2014, will lead to lower rates for USPS' Priority Mail services based on Commercial Base and Commercial Plus pricing. USPS' Commercial Base and Commercial Plus pricing are options available to businesses that ship a high volume of light weight packages, for example, e-commerce businesses.