Ina Steiner EcommerceBytes Blog
News and insight focusing on ecommerce.
by Ina Steiner, Editor of EcommerceBytes.com
Wed Sept 27 2017 00:30:42

China Sellers Will Pay 13 Percent More Mailing to US

By: Ina Steiner

Sponsored Link

Sellers in China will pay 13 percent more when mailing small packets to US shoppers beginning January 1st, according to a US government official.

The US State Department responded to a Congressman's concerns about the financial impact of UPU Terminal Dues that allow for companies in some countries to mail small packets to US shoppers for extremely low rates, giving them an advantage over domestic sellers.

Congressman Kenny Marchant had written a letter to Secretary Rex Tillerson in June stating he was "greatly concerned regarding the significant financial losses incurred by the USPS" as a result of the UPU conventions. He took a swipe at the former Administration, stating the US shouldn't be locked in to agreements that "undoubtedly are bad for US postal ratepayers and shippers."

Charles Faulkner of the Bureau of Legislative Affairs at the State Department responded in a letter in July. Readers may recall that the nearly 200 member countries of the UPU establish new terminal dues every four years, with the next rates taking effect in 2018. The purpose of the UPU Terminal Dues (TD) system is to compensate destination countries for the cost of handling, transporting and delivering letter-post items from abroad - so of course the US also pays other postal services for mail sent to those countries.

Faulkner explained that the 2012 convention had improved USPS compensation for inbound delivery of international mail compared to the former methodology, but did not result in the expected improvements in cost coverage because of the ecommerce-driven surge in the volume of small packets - especially from China and other rapidly industrializing economies. 

Faulkner said that the new 2016 convention accounts for the growing prominence of small packets in international letter cost, and he said it compensates postal operators at significantly higher rates for small packets than for small letters or flats.

Without mentioning China by name, he said countries that account for the highest volumes of small packets mailed to the US will see a 13% year-on-year increase in charges beginning January 1st. 

"The Department and USPS worked intensively over the course of four years to achieve this outcome" and believes the new convention will have a dramatic positive impact on USPS's compensation. "We note USPS's own assessment that the Convention will provide it with full cost coverage," he added.

Faulkner also noted that regardless of whether the United States is a party to a particular UPU Convention, "there is, as a practical matter, no viable alternative framework under which the U.S. could exchange mail with other UPU member countries."

The letter from Faulkner is the only document we've seen that pegged the impact of the 2016 UPU convention - experts said it was very difficult to quantify the impact of the changes. But even a 13% increase in costs is unlikely to make the inbound rates for small packets from countries like China on par with the costs of domestic US shippers.

(As we've noted previously, ePacket rates are different from but are influenced by UPU Terminal Dues since the latter give the USPS little leverage in negotiations; sellers generally refer to ePacket when discussing international postal cost inequities.)




Comments (37) | Leave Comment | Permalink

Readers Comments

Perminate Link for China Sellers Will Pay 13 Percent More Mailing to US   China Sellers Will Pay 13 Percent More Mailing to US

This user has validated their user name. by: Ming the Merciless

Wed Sep 27 01:50:21 2017

A slight improvement over the status quo until USPS raises their International first class rates again.

What's needed is parity, not charity.

Perminate Link for China Sellers Will Pay 13 Percent More Mailing to US   China Sellers Will Pay 13 Percent More Mailing to US

This user has validated their user name. by: Marie

Wed Sep 27 02:58:21 2017

It's a start, which is a good thing.  But I believe the difference between what I have to pay for a small package that I might ship across town is still FAR MORE than what an Asian seller would pay to ship the same package to me.  But I am certainly happy to see that we are at least starting the process to get this back in line.

Perminate Link for China Sellers Will Pay 13 Percent More Mailing to US   China Sellers Will Pay 13 Percent More Mailing to US

by: FeelingFroggy This user has validated their user name.

Wed Sep 27 05:08:07 2017

Big fat deal. So not instead of the post office losing a buck ten on each package they will now only lose 99 cents all the while raping the US customer with higher shipping rates to mail something across country.

By the time they can raise rates again in four years US postage will have doubled and these e packets will go up another buck ten.

Perminate Link for China Sellers Will Pay 13 Percent More Mailing to US   China Sellers Will Pay 13 Percent More Mailing to US

by: SANT1N1 This user has validated their user name.

Wed Sep 27 05:34:13 2017

While it's a meaningless increase, a flea on an elephant's back, at least it finally acknowledges there could be a problem with businesses 1/2 way around the world being able to ship items for less than we pay to ship something across the street!
Wouldn't surprise me if the Chinese gov't subsidizes any increase though. The last thing they want is for the natives to start getting restless.

Perminate Link for China Sellers Will Pay 13 Percent More Mailing to US   China Sellers Will Pay 13 Percent More Mailing to US

This user has validated their user name. by: Rexford

Wed Sep 27 06:47:29 2017

What Ming said.....parity.

Perminate Link for China Sellers Will Pay 13 Percent More Mailing to US   China Sellers Will Pay 13 Percent More Mailing to US

by: maxmad This user has validated their user name.

Wed Sep 27 06:50:18 2017


13% may be more then enough for some third world poor countries, but when it comes to China which is the worlds second largest  economy (soon to be number one ) is an out right crime, what on earth is going on here,

it's time China is completely removed from the e-packet deal. not negotiated  

Perminate Link for China Sellers Will Pay 13 Percent More Mailing to US   China Sellers Will Pay 13 Percent More Mailing to US

by: maxmad This user has validated their user name.

Wed Sep 27 07:46:01 2017

China has become more devious in their quest for world domination, so even if an increase is added to china alone, they will simply ship items out from other e-packet deal countries, the e-packet  as a whole needs to be removed or revised completely , too many loopholes   and way to destructive to everyone else, this is not just a USA problem, it's Global and hurts every country with a normal standard of living,

I also cannot blame china, they didn't create the e-packet , any country would do the same, if given the opportunity  

Perminate Link for China Sellers Will Pay 13 Percent More Mailing to US   China Sellers Will Pay 13 Percent More Mailing to US

This user has validated their user name. by: toolguy

Wed Sep 27 08:12:03 2017

If an ePacket costs .30 cents they'll be paying 4 cents more!

I'm NOT impressed. . . .Why don't they pay the same prices we do?

Perminate Link for China Sellers Will Pay 13 Percent More Mailing to US   China Sellers Will Pay 13 Percent More Mailing to US

by: FeelingFroggy This user has validated their user name.

Wed Sep 27 09:19:55 2017

So the us post office raises it 13% and can't raise it again until 2022.

Didn't the post office just raise the price of a first class package over the counter by almost 10 % this month.

I can hardly wait until the annual increase for online postage in january comes. Bet its almost 5 %.


So the chinese and their junk is still a bargain at any price especially if you want to return something. That will cost about 20.00 for that 99 cent item.

Perminate Link for China Sellers Will Pay 13 Percent More Mailing to US   China Sellers Will Pay 13 Percent More Mailing to US

by: Geetar This user has validated their user name.

Wed Sep 27 10:07:25 2017

Why is it only 13%?

Quite a few sellers from china know this would eventually happen. So some of them have opened warehouses in countries like Malaysia, Vietnam, and the Philippines so they can still enjoy the same low rates they always had.

Does any one know for sure what they actually pay?

Perminate Link for China Sellers Will Pay 13 Percent More Mailing to US   China Sellers Will Pay 13 Percent More Mailing to US

This user has validated their user name. by: toolguy

Wed Sep 27 10:15:51 2017

@Geetar

It can't be much as you can buy stuff for .99 cents with free shipping from china!

How do they afford the shipping, ebay fees, paypal fees & the cost of goods all for 99 cents?

Perminate Link for China Sellers Will Pay 13 Percent More Mailing to US   China Sellers Will Pay 13 Percent More Mailing to US

by: mcposty This user has validated their user name.

Wed Sep 27 10:20:24 2017

Traitors!! This is ignorant. 13 percent. Can't raise it til 2022 but our rates go up every year.

We truly need to protest..get the word out..this is Insane

Perminate Link for China Sellers Will Pay 13 Percent More Mailing to US   China Sellers Will Pay 13 Percent More Mailing to US

by: Snapped This user has validated their user name.

Wed Sep 27 10:24:01 2017

This compensates the service provider, yet won't result in lower domestic costs of course.  But it might be worth considering - What's in those things, anyway?  And why are there so many of them?  

Might it be that Americans as a whole usually have just enough disposable income to afford their attraction to dime store, impulse buy trinkets?  Because that's what's in the majority of them.  They're usually not very large, and don't contain goods of large value.  Truth is, for the vast majority of ePacs, they are no more costly to process and deliver than domestic 1C letter mail.  Most are also 'untracked' too.  So the competition argument isn't necessarily with the disparity in that cost - unless tracking is somehow made to be a 'requirement' by the shipper's...uh....venue (agent?) as a condition of achieving parity in visibility.

Of course there are the larger ePacs.  Those, indeed, are relatively more 'expensive' to the domestic buyer to ship.  And they contain product more likely to be domestically in competition with Beijing, et.al.  

Until one consider's Customs.  Which of course isn't a ship cost, and goes to the Feds, who don't fund the USPS.  So good thing this increase does somewhat.  Anyway, from buyer perspective, Chinese grass wasn't necessarilly greener pre-windfall either - unless it was somehow made to be the only grass apparently available by the....uh...venue.  And now, it can be custom colorized!

Thus, while some in Congress have helped the USPS recoup some lost costs (and thank you Ina, for clearly explaining the USPS's weakness in negotiating leverage, and what should be a lack of blame for conditions in context to date), it would be nice if that same 'Congressional concern' might be brought to bear upon who is REALLY more culpable when it comes to manipulating 'parity' in eCom competition.  

And who stands to profit from every stamp licked, be that in dollars OR renminbi, and then labeled as 'growth'.  

Perminate Link for China Sellers Will Pay 13 Percent More Mailing to US   China Sellers Will Pay 13 Percent More Mailing to US

by: hopeforthebest This user has validated their user name.

Wed Sep 27 10:44:03 2017

Snapped: What the heck can be mailed for $.01 these days? I think you're living in the past...

Perminate Link for China Sellers Will Pay 13 Percent More Mailing to US   China Sellers Will Pay 13 Percent More Mailing to US

This user has validated their user name. by: toolguy

Wed Sep 27 11:24:43 2017

i DON'T ship to china!

i DON'T buy anything on eBay being shipped from china!

i DON'T do china. . .

Perminate Link for China Sellers Will Pay 13 Percent More Mailing to US   China Sellers Will Pay 13 Percent More Mailing to US

by: maxmad This user has validated their user name.

Wed Sep 27 12:03:39 2017

Don't be fooled by made in china, it won't effect me, or that the stuff is garbage, a lot of it is high quality, and stuff you really can't get anywhere else anymore, other then china,

At the end of the day, it really doesn't mater anyway, china will be the leader in manufacturing ( if not already ) and will be the strongest country in the world, financially, and militarily, we gave them all our technology, our manufacturing, and now we buy almost everything from them, this e-packet deal is peanuts, it won't stop their overall plan,

Remember your not buying off an individual seller, person, or company when you buy made in china, the money all goes to China , it's like one big communist corporation, they will take every last cent until they have and own it all.

And by the way, not one square inch of china land is for sale, it's all owned and operated by the communist china corporation.    

 

Perminate Link for China Sellers Will Pay 13 Percent More Mailing to US   China Sellers Will Pay 13 Percent More Mailing to US

by: Frank F This user has validated their user name.

Wed Sep 27 13:30:33 2017

Good grief!! WHY do we put our country and OUR businesses at such a disadvantage. China has a campaign to dominate every manufacturering and retailing sector by 2025 and are well on their way. Its an absolute DISGRACE that our government is allowing these foreign countries to dump all the counterfeit and trademark infringing goods into our markets, and allow them to even ship at a fraction of the cost it is for a US company to ship! Absolutely disgraceful and EVERYONE should contact their congressman to complain.

PS: I bought an item from China once and it shipped for 91 cents. Of course it was a piece of junk and I wanted to return, but they wanted me to pay the return shipping which I researched and it was $21.45... We should not have this disparity in cost between the criminals in China and US small business.....

I want to see us WIN WIN WIN WIN, but looks like we just continue to LOSE, LOSE, LOSE, LOSE, LOSE........

Perminate Link for China Sellers Will Pay 13 Percent More Mailing to US   China Sellers Will Pay 13 Percent More Mailing to US

This user has validated their user name. by: RKTOYS

Wed Sep 27 13:51:08 2017

@toolguy
@geetar

It has to be damned near zero.  If you work backward from the 99c to remove the various fees (assuming eBay and PayPal even charge them), you're left with about 55c.  A 13% increase (over 5 years, 2.5% annual) in that is nothing short of a joke.  How about the Republicans stop attacking one part of the federal government that actually works (the USPS) and all of them stop coddling Russia's best friend?

Perminate Link for China Sellers Will Pay 13 Percent More Mailing to US   China Sellers Will Pay 13 Percent More Mailing to US

by: uppercutknives This user has validated their user name.

Wed Sep 27 14:27:36 2017

It would see the solution is to "drop ship" from China to save on US shipping.
It may seem crazy but it could work. Then we could eliminate jobs and company's across america that sell the same products. Then we could become more dependant on China and eventually succed to China as an international province thereby forgiving out debt to China. I can't wait to see myself wearing one of those funny little hats they wear in rice fields.  Short story its our Government selling us out to China.

Perminate Link for China Sellers Will Pay 13 Percent More Mailing to US   China Sellers Will Pay 13 Percent More Mailing to US

by: dans parts This user has validated their user name.

Wed Sep 27 14:49:22 2017

"countries that account for the highest volumes of small packets mailed to the US will see a 13% year-on-year increase in charges beginning January 1st."

Does that "year-on-year" mean 13% increase EACH YEAR of the 4-year agreement?

THAT would be somewhat more palatable.

Click to view more comments
1 2  [Next Page]


Login is required to post comments.
To sign in to leave a comment using your AB Verify User Name, fill in the form below. If you have not yet signed up for AB Verify, or if you'd like more information, go to the Registration Page
.

Login for AB Verify
Be sure and use your email address and password to log in.

 
Email:
Password:
 
 Forgot Your Password?
 Even though you are signed in with the AuctionBytes Blog, you will have to sign in to the EcommerceBytes blog. But you can sign in with your existing AB Verify info.