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Tue Aug 13 2019 15:12:09

Never Too Soon to Talk about Postage Rate Hikes

By: Ina Steiner

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The USPS is already preparing next year's postage rate increase, according to the Official Mail Guide (OMG). As online sellers know all too well, shipping carriers raise rates at the beginning of each year (and sometimes more than once a year).

The USPS provides "market dominant" postal services, which includes First Class mail, and "competitive" shipping services, which includes Priority Mail. Each of those two categories of mail have different restrictions on how rates can be changed.

The USPS is not allowed to raise market dominant rates higher than the Consumer Price Index (CPI), while it has much more freedom in raising competitive rates. 

OMG magazine said mailers should expect the USPS to file a request with the Postal Regulatory Commission in October for market dominant rate hikes in January 2020. "Key to what the rate hike will be is the August Consumer Price Index (CPI), which will be known in mid-September. At this point the forecast is 1.9%, which would be the maximum rate hike permitted under law."

But Printing Impressions World noted this week that the Postal Regulatory Commission is currently involved in a "major review of the system for setting market dominant rates."

Neither publication shared insight into how the USPS is thinking about rate changes to *competitive* products like Priority Mail. 

Note that eBay and Etsy generate additional revenue for themselves when shipping rates go up, since they charge sellers a "commission" fee on shipping costs - meaning marketplace sellers face the double-whammy of a postage rate hike and a marketplace fee hike all in one.

Sellers are still reeling from the USPS changes to DIM weight rates in June.

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Perminate Link for Never Too Soon to Talk about Postage Rate Hikes   Never Too Soon to Talk about Postage Rate Hikes

by: FeelingFroggy This user has validated their user name.

Tue Aug 13 18:04:57 2019

By the time the next raise takes effect we will be down to one store with 5000 items. All of them ship in an envelope for 55 cents. So USPS go for it we don't care.

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by: Silver Ice King This user has validated their user name.

Tue Aug 13 22:46:51 2019

USPS needs to take into consideration (which I am sure they will not) that the US is pulling out of the Universal Postal Union around the first of the year if not before.  This should have a very large effect on the Chinese Sellers as USPS will no longer be told that they have to lose money on every package sent to the US from China.  China is still considered a 3rd World country per the UPU and gets shipping rates that are the same as Gabon.  

China has taken complete advantage of this and flooded our country and many others with packages that cost the USPS money, yet they can do nothing about the pricing.  Last I heard USPS is losing around $0.50 per Epacket they handle and when the UPU had a special hearing about this issue last year they voted to table the issue until their next regularly scheduled meeting in 2020.  Sounds very much as if China is able to still exert a lot of pressure on the members of the UPU,  so the US gave them notice of our intent to withdraw from the group effective in 1 year (which was the shortest time frame they had).  All of this comes to a head around the first of the year which means that USPS can charge China any rate they please and I expect it to be on par with what we have to pay to return an item to China.  This should have a large impact on how much USPS raises the rates on our domestic shipments.

Guess we will have to wait and see if the USPS  is also in bed with the Chinese.  If it turns out they are, and they do not charge China rates that cover ALL of their costs to the USPS  then Congress needs to clean house on upper management at USPS  period.

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by: mjr55 This user has validated their user name.

Wed Aug 14 00:36:37 2019

This is just their way of passing price increases onto small sellers every single year because they can. It's almost gouging at this point.

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This user has validated their user name. by: DeathFromAbove

Wed Aug 14 01:22:42 2019

They are going to be in for a rude awakening in January.  When all of their medium and larger package services they would have handled prior will land with FedEx and UPS.  They will have to do a "competitive" rate decrease.  The future is not in junk mail and 1st class package.  Their leaders do not have the vision to see this.  When they price themselves out of a category, they will lose it forever.

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by: Chicago48 This user has validated their user name.

Wed Aug 14 04:09:52 2019

AMZ already allows us sellers to choose UPS and Fedex and IMO  the large package rates are much lower than the USPS.

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by: hawk This user has validated their user name.

Wed Aug 14 05:35:53 2019

all you ever hear about is how much to increase shipping fees on the small business people , and how much the thieving venues are going to steal on shipping fees that only a filthy piece of crap would steal.

never do you hear how they are going to help small business be a success , for our great American people to be a success. so sad !!

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by: Chicago48 This user has validated their user name.

Wed Aug 14 07:20:45 2019

@hawk, IMO there will be a slowdown in selling and retail next year.  I don't know how the big brand names can continue to offer "free" shipping with the USPS continuing to increase shipping fees.   We may begin to see free shipping with orders over $50, instead of $35.  As for the little seller, fuggedaboutit.

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by: Caroline1 This user has validated their user name.

Wed Aug 14 08:06:55 2019

IMHO, shipping rates—rather than anything the platforms can dream up—will be the end for ecommerce's small sellers.

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by: toyman This user has validated their user name.

Wed Aug 14 10:08:01 2019

It simply amazes me that the leadership of the USPS, obviously incompetent enough to lose millions of dollars a year, can't seem to handle ANY level of success. They, due to their current prices, are THE most practical way to ship e-commerce packages, especially anything with any weight or size to it.

So, what is the preferred plan to make a profit? Why, run your prices up to where they are greater than the competition you had been whipping soundly, of course!
That should DEFINITELY help your bottom line...

They already showed they knew how to destroy a profitable venture by raising (read:doubling) the price of International shipping, to where that basically went away. So, they obviously know how to kill their built in advantage and thus continue to bleed money.

Do these people hire from the same talent pool as eBay???

Please. Have some common sense.

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by: epuise This user has validated their user name.

Wed Aug 14 10:13:24 2019

When the Recession hits... maybe all the low info people who don't READ will realize that the current Admin is NOT making America great again... The erratic doofus & his enabler in the Senate are doing NOTHING for the US... The rich & corps have ALL the wealth... they are NOT spending w/ Middle Class... not at our businesses... not on our wages... They offshore or trust fund the cash... While enjoying $60,000 cars & $100 steak dinners & donating $250,000 to campaigns... OUR Tax dollars... so the piggy top 20% can enjoy THEIR life... WE are losing sales to too high postage & added taxes on sales... OUR buyers are balking as THEIR wages went down or stayed the same... THEIR Tax Refund disappeared... WAKE UP... folks... it's 2007... again... the National Debt is over a Trillion & we pay our taxes to debt interest to... CHINA... Everybody... including USPS... is grabbing for CASH... We have no reserves... not personally... not in the Treasury... Our roads & bridges are crumbling (good jobs)... Our produce is costing MORE (no migrant workers)... Our farmers are getting tax dollar WELFARE as tariffs caused foreigners to NOT buy their crops... THEY are all OUR CUSTOMERS... WHO are these 21% tax rate Corporations going to SELL TO if WE have NO MONEY ?

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by: purpleiris This user has validated their user name.
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Wed Aug 14 10:33:44 2019

If we're pulling out of the UPU next year, then the USPS should be increasing rates to China alone and leave domestic shipping where it's at. The whole point of pulling out of the UPU is to stop letting China take advantage, which, in turn, should give American businesses a break.

Yet, we're hearing that they're considering raising rates by the maximum amount allowed just when they're given the opportunity to change things for the better on our end? At this point, it sounds like the whole pulling out of the UPU thing was just so the US government could stick it to China under the guise of helping small business.

I am so sick of all these hands in my pie that just keep taking more and more every year! Between the states pulling their money grabs via unconstitutional sales tax laws, marketplaces trying to take control of our businesses while trying to tell the government that they're not their responsibility, and the USPS rates going up exponentially every year, where are the small business advocates on Capitol Hill?

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This user has validated their user name. by: toolguy

Wed Aug 14 11:53:25 2019

I only use Fedex or UPS when the item can't fit in a Large Flat Rate Box. . .

I've stuffed 55 lbs in a Medium Flat Rate Box once, the postal clerk had to get someone bigger to take it off the counter.

I left smiling. . . . .because that $17 at the Post Office was $105 at Fedex

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This user has validated their user name. by: RKTOYS

Wed Aug 14 14:24:24 2019

@toyman
I haven't shipped to Canada for at least a decade.  It's just way too expensive.  And I'm just 200-400 miles from 3 of their most populous cities.  Insane.

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by: toyman This user has validated their user name.

Wed Aug 14 16:42:08 2019

@RKTOYS
I used to have a thriving business selling diecast cars to Australia. The guys there had limited availability, on continent, and they were happy to add $34 to their $60 car and still get it for less than $100 delivered.

Now, that same car costs $65 to ship. So, no sales.  I wouldn't pay that either!

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This user has validated their user name. by: Bill

Thu Aug 15 01:05:21 2019

Just received a small packet today and it measured 6x9x3/8 with stiffener inside and weighed 4 ounces.
It did not have a customs form even though it was valued at $13.00 so it went as non-machinable first class mail.
It cost the seller 11.55zt which is only $3.00.
If I had to send the same thing to Poland it would have been $10.50 what is wrong with this picture?
We are getting screwed by the rates that the USPS is charging because they are blotted with middle management that do nothing and by the muscling of Congress to have to have the pension funded for way to many years.
Something is very wrong and it is all going to come crashing down on all of us.

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This user has validated their user name. by: Bill

Thu Aug 15 01:06:03 2019

Forgot to mention the packet came from Poland.

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by: GracefulAntiquesVtg This user has validated their user name.
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Thu Aug 15 12:00:55 2019

Silver Ice King.

You made my day, week, month and year!

One can certainly dream.

The day eons ago I walked into the local USPS and saw a sign for Ebay on the wall I knew it would certainly be a bumpy ride.

Never did understand what I thought was a Government entity what I thought the Post Office was joining with what I thought at the time was a private Company.

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by: booklover27 This user has validated their user name.

Thu Aug 15 12:52:21 2019


Government should oversee private businesses not help the oligarchy destroy small business as they have done in last 15 years.  I say shut them down and let them get corporate jobs.  They treated the small businesses in America like garbage and deserve this fate.

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by: Slowest Learner This user has validated their user name.

Thu Aug 15 14:41:02 2019

@ Bill

What did you buy from Poland?  I regularly buy from Poland, ebay sellers and other venues.  I buy mostly books.  What'd you end up getting?  Just curious.

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This user has validated their user name. by: NoMoreEbay

Thu Aug 15 16:16:47 2019

USPS lost $1.1 billion for the period that ended June 30, 2019. Sellers small, medium and large have already vacated the never ending greed fest brought on by ebay, Etsy, USPS and the like.

The end is already here. Has been for me since last year. No matter what these short sighted idiots do, if they kill the profit, they kill the seller and ultimately themselves.

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