International on-line merchants are increasingly looking for alternative solutions for last mile delivery as parcel post rates are set to increase - and in some cases drastically.
Effective July 1st, the United Postal Union allows for the USPS - and all post offices - to set their own price. Previously, post offices were bound by UPU rules that forced post offices to delivery below costs.
Universal Postal Union (UPU) rule change originally projected to be a 5 year plan starting July 1. With that date quickly approaching, we are receiving the inquiries to Canada and to the US as parcel post are set to increase.
The USPS is seeking individual agreements with over 30 countries including shipping US to Canada.
As demand for deliveries have increased dramatically due to COVID-19 issues, the rate increase comes at a difficult time. On line shippers are now looking to ship directly and new parcel logistics solutions.
USPS increases can be significant for retailers who rely mostly on cross border online sales from the US but also for imports to the USA.
Disclaimer: The information in Jet Worldwide online content, including this post, is for general information only and is not intended to, constitute legal and/or tax advice. All liability with respect to actions taken or not taken based on the contents of this site are hereby expressly disclaimed. The content on this posting is provided “as is”; no representations are made that the content is error-free.
>
Canada Post is moving the timing of its annual parcel services to earlier in the year. Higher rates rates International parcels are being implemented four months ahead of the usual January update. Canada Post "Small Business" customers will see in increase in January. The weighted increase for Canada Post international shipping is around 3%.
Shipping International Ecommerce orders Direct;
Jet Worldwide offers direct shipping and direct shipping options from North America to the UK, European Union, Japan and all the world's major economies (see link above).
Postage Resellers
Most major online retailers deal with USPS resellers / consolidators. The contractual terms usually call for increases at the start of each year and the timeline for this potential increase is unusual. In fact, there is no clear communication as to what will happen.
International consolidators who are subject to cost increases include:
- Ascendia, IMS, and other postal operators
- DHL, FedEx and UPS mail divisions
- Traditional resellers such as Pitney Bowes, Stamps, and Shippo
Cross-border postage rates represent the combination of three services:
- Air freight to destination country
- Clearance and import fees
- The domestic service by the domestic postal carriers
- Handling costs of the service provider
Shipping Direct to the USA and Canada:
Large retailers are increasingly connecting directly with USPS via Global Direct Entry or via a reseller and shipping direct to the US and Canada. Clearance to the USA can be set up directly via Section 321 express clearance including type 86 for large airfreight and ocean freight shipments.
Shippers are increasingly looking to ship direct by setting up their own internal logistics solutions for more control and lower costs. Contact Jet's team for shipping solutions to Canada.
Clearance and Delivery to the EU:
Jet Worldwide is also working with e-tailors who need bulk import and distribution across the EU. We are also getting many inquiries for shipping from Canada and the USA to the EU as postal rates - including from postal consolidators - are similarly expected to increase.
Clearance and Delivery to Canada
Our team is being contacted to get rates for shipping within Canada as USPS rate to Canada is expected to increase 50%.
Rate Increase by postal services capped
The new UPU rules allows post offices to set their own pricing (referred to as self declare) but it must not exceed 70% of the domestic rates.
Post offices around the world are keen to protect their cross border e-commerce business with reciprocal rate setting.
Post Offices: Critical Infrastructure
Post offices represent critical public infrastructure for all e-commerce. Have a public utility of sorts can help small and medium sized retailers reach customers and suppliers around the world. Even with the price increases, their "small packet" services will likely remain the lowest cost solution for cross border shipping of shipments under 2 kg/ 4 pounds.
Ocean Freight to Post Solutions:
With new US customs processes (Section 321, Type 86), on-line merchants are now looking to build ocean freight processes direct to the US. Jet assists volume shippers can build scaleable dynamic multi-modal, multi-port, multi clearance solutions:
- Air Freight Express Clearance via ECCF
- Air Freight Economy Clearance via CFS
- Ocean Freight Section 321 Type 86 Economy Clearance
- Shipping to the USA via Canadian border solutions
jetworldwide.com
