pushed last year’s changes to hit back at China, which originates much of the business-to-consumer (B2C) traffic entering the U.S. Though it was never formally stated, the U.S. This could create beneficial shipment consolidations and improve transit times and costs, he said. One way for U.S.-based merchants to get around the pricing program would be to “stage” merchandise in or near destination countries and fulfill orders as needed, Schoeman said. Schoeman, president of The Colography Group, Inc., a consultancy. Private carriers are “awaiting to serve USPS customers who are in need,” said Mark S. to foreign destinations, according to executives interviewed for this story. The changes may prompt U.S shippers to switch to carrier upstarts like Passport Shipping that focus on e-commerce, or incumbents like DHL eCommerce and UPS Economy, a UPS unit that specializes in handling and shipping high-volume, low-value goods, to ship their goods from the U.S. (NYSE: UPS), which have the reputation of providing a better service
outbound rates may rise above the prices charged by private express carriers like DHL and UPS Inc. This puts pricing pressure on USPS and, by extension, on U.S.-based merchants that ship goods with thin profit margins to start with. However, the agreement now allows foreign destination posts to hike their rates on U.S.-originating traffic as well.
In many cases, this roughly doubles the rates that USPS could charge countries like China, which under the old system was still classified as a “developing” country and thus eligible for subsidies.The United States, which handles about half the world’s mail, threatened to leave the UPU last fall unless terminal dues were scrapped and a self-declare regime put in its place. and any country it does business with to hike rates up to but not exceeding 70% of what would be charged to deliver a domestic mail and parcel shipment. It replaced a 50-year-old “terminal dues” program in which UPU set multilateral rates and required established posts to subsidize the processing and handling of items from countries that it deemed less advanced. The structure, agreed to last fall by 192 members of the Universal Postal Union (UPU), the group that oversees the world’s postal systems, allows countries to “self-declare” their rates, either immediately or over a five-year phase-in period, for processing and delivering inbound parcels from foreign postal systems. On that date, a new pricing structure for the movement of low-value small parcels goes into effect that raises rates on shipments connecting a number of origin and destination postal systems. At the same time, USPS faces competitive headwinds on the international parcel shipping front starting July 1. Postal Service (USPS) is fighting to keep its head above water amid staggering financial losses related to the coronavirus pandemic and the Trump administration’s refusal to grant the relief the agency says it needs to avoid going broke by Sept.
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