Ina Steiner EcommerceBytes Blog
News and insight focusing on ecommerce.
by Ina Steiner, Editor of EcommerceBytes.com
Wed Jan 9 2019 21:02:18

Small Packets from China to Get More Expensive

By: Ina Steiner

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Small packages from China (and elsewhere) delivered to shoppers by the US Postal Service will become more costly for overseas sellers, helping to level a playing field that many domestic online sellers feel is skewed against them.

At first blush, it looks like small US sellers will be rejoicing, since in many cases it costs them more to send a similarly sized parcel to a US buyer than it costs a Chinese seller/shipper - for packages weighing under 4.4 pounds.

It could have a negative impact on eBay and Amazon, however, whose platforms are attractive to international exporters sending goods to the US; though keep in mind that eBay CEO Devin Wenig said in November that his company helps Chinese sellers warehouse goods in the United States.

The change came not from the international organization that sets "terminal dues" (the UPU), but rather, from the US Postal Regulatory Commission (PRC).

In November, the USPS filed a request with the PRC to change how it classifies Inbound Letter Post small packets and bulky letters, known as Inbound E format, asking permission to move it from "Market Dominant" to a "Competitive" product.

Today, January 9, 2019, the PRC conditionally approved the request.

The USPS had written in its request, "Upon favorable review of this request, the Postal Service will submit a new filing to set new rates for inbound international market dominant and competitive services, subject to PRC review and approval," so don't expect an immediate change in rates.

While the UPU was already making progress on making terminal dues more equitable, President Trump's August memorandum gave the issue urgency. Today's announcement doesn't change the Administration's decision last October to withdraw from the UPU.

It's unclear from today's PRC ruling what the impact will be on "ePacket" rates which are negotiated between international postal services. For example, China Post and the USPS have agreed on ePacket rates that include tracking, which postal products under terminal dues do not.

It's also conceivable that foreign posts such as China Post could choose to subsidize the higher costs for sellers who export to the United States.

It will be interesting to see what shipping experts have to say in the coming days, but for now, US sellers have reason to believe that the shipping-cost playing field will soon become more level.

Also sure to be welcoming today's news: shipping carrier UPS, which pushed for the change.

PS: One other note: The USPS has greater flexibility to raise rates for products classified as competitive than those classified as market dominant.

Comments (28) | Leave Comment | Permalink
Readers Comments

Perminate Link for Small Packets from China to Get More Expensive   Small Packets from China to Get More Expensive

by: pace306 This user has validated their user name.

Wed Jan 9 22:49:51 2019

Hopefully this will throw a monkey wrench into DW's plans!

Perminate Link for Small Packets from China to Get More Expensive   Small Packets from China to Get More Expensive

by: Chicago48 This user has validated their user name.

Thu Jan 10 00:21:13 2019

OT:  Is anybody else having problems with the USPS SCANNING packages?  I have mailed two packages last week and they have not been scanned.  Thanks for your answer.
As for the China postage, postage is going up all over.  I cringe to think about the cost increase for Canada.

Perminate Link for Small Packets from China to Get More Expensive   Small Packets from China to Get More Expensive

This user has validated their user name. by: toolguy

Thu Jan 10 01:23:54 2019

@Chicago48

Either I set them out for my carrier who scans them or I wait in line at the Post Office to get them scanned.

I stopped dropping them off or putting them down the chute months ago without any scan. . .

Perminate Link for Small Packets from China to Get More Expensive   Small Packets from China to Get More Expensive

by: SellerGirl This user has validated their user name.

Thu Jan 10 05:14:57 2019

What is welcome about a raise in shipping costs from China?  Some of my raw materials come from China and only China, there are NO US suppliers for these materials.  Now those products, which I buy in small packets because they are expensive and ever-changing, will cost me more.  Should I let my profits take a hit or charge the customers more?

Perminate Link for Small Packets from China to Get More Expensive   Small Packets from China to Get More Expensive

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

Thu Jan 10 06:13:49 2019

Good, level the playing field!  I've seen Chinese sellers sell identical stuff to what I sell, and they've been selling it for less than what it costs me to ship!

Perminate Link for Small Packets from China to Get More Expensive   Small Packets from China to Get More Expensive

by: hopeforthebest This user has validated their user name.

Thu Jan 10 06:15:43 2019

I am also having the scanning issue, every day I have 2-3 customers going nuts, wanting to know why their package still shows ''pre-transit'', it's an issue that has been going on since before Christmas.

Perminate Link for Small Packets from China to Get More Expensive   Small Packets from China to Get More Expensive

by: Chicago48 This user has validated their user name.

Thu Jan 10 06:34:32 2019

@Sellergirl - I think we're all going to feel the pain, buyer & seller.  I buy small electronics and Ink from China.  I can't get a good low price for those items.  I'm going to order NOW before it goes higher.
@Hope for the best -- thanks.
To all -- how will this effect sites like Poshmark that send us a prepaid postage?  Looks like we'll have to hike our prices to cover the cost of USPS postage going up today.

Perminate Link for Small Packets from China to Get More Expensive   Small Packets from China to Get More Expensive

This user has validated their user name. by: thehosst

Thu Jan 10 07:12:41 2019

Hold on folks, is the increase going to be 1 penny per lb???.. I think it should be at least what it costs to send from USA to China, but the other side is, when will eBay charge the same costs to list items to China and India dropshippers, it charges to USA and EU sellers?  

Perminate Link for Small Packets from China to Get More Expensive   Small Packets from China to Get More Expensive

by: maxmad This user has validated their user name.

Thu Jan 10 08:08:18 2019

a few cents more, won't change a thing, China is laughing at the west,
it's business as usual,

Perminate Link for Small Packets from China to Get More Expensive   Small Packets from China to Get More Expensive

This user has validated their user name. by: Ina

Thu Jan 10 09:25:16 2019

"Regular" USPS Postage rate increase (including domestic): January 27, 2019

Yesterday's announcement paves the way for higher costs for imports.

Perminate Link for Small Packets from China to Get More Expensive   Small Packets from China to Get More Expensive

by: Flying Childers This user has validated their user name.

Thu Jan 10 10:42:08 2019

I used to think that this would be a big deal and very helpful to small US sellers, but I have since changed my mind.  

I too buy a lot of my supplies that come from China, for one of my handmade shops.  When those prices go up, I'll have to add it to the cost of the items.  My fear is that whenever the Gov'mint gets  involved, it just makes things worse all around.

If Ebay and Etsy want to do something to help the beleaguered sellers, they don't have to ask the Feds to step in.  

How about if they just gave us a fair deal- show ALL the listings that people are looking for in search, go back to the old payment system where Etsy allowed bill payments throughout the month, and a hundred other things that the Ebay sellers have posted in these pages.

Perminate Link for Small Packets from China to Get More Expensive   Small Packets from China to Get More Expensive

by: lessthanthreerecords This user has validated their user name.
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Thu Jan 10 10:49:34 2019

I get the idea of "leveling the playing field," but my main problem with Chinese sellers paying less to ship to the U.S. than I pay to ship to the U.S. (from the U.S.), is not the level playing field, but the fact that the money USPS loses on inbound packages from China is made up for on the backs of domestic shippers.  However, my domestic rates are going up too!

Perminate Link for Small Packets from China to Get More Expensive   Small Packets from China to Get More Expensive

by: semper fi This user has validated their user name.

Thu Jan 10 11:06:07 2019

Yes we see on  a daily basis that a seller is located in China but ships within the US. So ebay is taking the huge profit it makes off the US sellers and uses it to subsidize the Chinese to flood our market place in the US by warehousing and shipping goods for them at no cost. There is a lawsuit just waiting to be filed by the right law firm who will bring ebay to it's knees,

Perminate Link for Small Packets from China to Get More Expensive   Small Packets from China to Get More Expensive

This user has validated their user name. by: CanBrit

Thu Jan 10 11:22:30 2019

@Chicago48

We always take our packages to the postal station. Even still, I've checked the packages on our return and found that 1, sometime 2 haven't scanned properly. One of the postal employees did say they had problems with their scanners.

Perminate Link for Small Packets from China to Get More Expensive   Small Packets from China to Get More Expensive

This user has validated their user name. by: NoMoreEbay

Thu Jan 10 11:30:14 2019

Music to my ears. I can't think of a more deserving company to lose it's favorite seller base and billions along with it. BRAVO!

Sure to follow will be the disingenuous 'we love US sellers' campaign. With Kupbeans throwing around words like nimble and pivot. LOL  

Perminate Link for Small Packets from China to Get More Expensive   Small Packets from China to Get More Expensive

by: Whatever This user has validated their user name.

Thu Jan 10 11:32:55 2019

until people stop buy cheap shite from china nothing changes - go watch that movie Crazy Rich Asians - pretty eye opening - Americans just don't get it

Perminate Link for Small Packets from China to Get More Expensive   Small Packets from China to Get More Expensive

This user has validated their user name. by: Rexford

Thu Jan 10 12:44:59 2019

"US sellers have reason to believe that the shipping-cost playing field will soon become more level."

Ha!  Folks are deluding themselves.  As long as warehouses exist in the USA and as long as China can manufacture products at a much lower price that companies in the US do it will have little or no impact on a "level playing field".

What it will do however is raise prices on folks who import raw materials (see SellerGirl's comment) from China to create products.  Small sellers who import items to sell will also be affected.

It's a global economy.  You either embrace it or you live in 1945.  And you still have to live with USPS raising shipping costs  in the USA EVERY year.

Perminate Link for Small Packets from China to Get More Expensive   Small Packets from China to Get More Expensive

This user has validated their user name. by: Rexford

Thu Jan 10 12:49:14 2019

"Whatever", can you tell me what you know about products from China?  Cheap products come out of every country in the world.  There are also high end products coming out of every country in the world, including China.

Are you aware that Prada, Burberry, Armani, Dolce & Gabbana, Miu Miu are producing products in China?    China is no more the "bogey man" than the USA is.  Global economy.  

Perminate Link for Small Packets from China to Get More Expensive   Small Packets from China to Get More Expensive

by: Vernfern This user has validated their user name.

Thu Jan 10 14:16:14 2019

IMHO the increase in ePacket cost is simply ear and eye candy for those who don't grasp the real situation. Political feather in the cap and little more. Now if there was a significant change in shipping cost to only consumer destinations or a removal of the subsidized ePacket option - maybe that would be a positive change.

As it is, it's just political brag candy and nothing more.

Perminate Link for Small Packets from China to Get More Expensive   Small Packets from China to Get More Expensive

This user has validated their user name. by: Rexford

Thu Jan 10 15:22:52 2019

"As it is, it's just political brag candy and nothing more."

BINGO!  

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