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Mon Aug 1 2016 23:18:01

USPS Allowed to Negotiate FCPS Rates?

By: Reader

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Dear Ina,
I found your recent article rather interesting regarding stamps.com. But either I’m completely misinformed or I misunderstood something.

To my knowledge USPS does NOT allow any online site to "negotiate" FCP domestic rates. Currently they either get Commercial Base Pricing or Commercial Plus Pricing, depending on their size. And as the article states, as it stands now, USPS plans to phase out CPP in 2017.

It is my understanding that the FCP International, Priority Mail and Express mail can be negotiated. For example, eBay gets a much better rate on FCP International (15% discount) than Amazon and probably other sites as well.

Anyway, I may have taken the article the wrong way, but it seem to say to me that USPS FCP domestic could be negotiated. 
Marie

NOTE: We asked the USPS about this, a spokesperson told EcommerceBytes: "For First-Class Package Service, a competitive commercial product, the Postal Service may engage in contract rates."




Comments (9) | Permalink

Readers Comments

USPS Allowed to Negotiate FCPS Rates?   USPS Allowed to Negotiate FCPS Rates?

by: Postalwizard This user has validated their user name.
Web Site

Tue Aug 2 15:21:31 2016

Yes, The USPS does provide NSA pricing for large FCPS shippers.  I have not seen any (discounted FCPS)for sites that allows participation from others.  I see the redacted filings regularly from the PRC and can't help but wonder if discounts are somehow tied to workshare incentives that were removed with the Jan 17th rate change: This is when Base and CPP were merged (now all under Base) and saturation discounts were eliminated.

USPS Allowed to Negotiate FCPS Rates?   USPS Allowed to Negotiate FCPS Rates?

by: Scotty This user has validated their user name.

Tue Aug 2 15:34:04 2016

It would be easy for them to have wiggle room in pricing for FCMI considering they have raised the price of shipping a 6 oz package internationally 135% in the past 4 years.  This has killed my global business and just yesterday, I had a would-be customer in Russia chastise me for the high postage.  (I forgot that I actually created the pricing for the USPS therefore it's my fault....)
Seriously though, I always have only charged exact cost postage for global shipments and this includes the discount I get from Endicia.  I think they keep raising the global pricing to detract from the losses they incur domestically in an attempt to make up the difference as they figure the domestic outrage would be far louder than that from global sellers.  Well, I cannot see how this has worked as my global sales have gone from 60% of sales to 1-2% +/-....and that will certainly not ''balance'' their books on their domestic losses.

USPS Allowed to Negotiate FCPS Rates?   USPS Allowed to Negotiate FCPS Rates?

This user has validated their user name. by: Marie

Tue Aug 2 18:39:46 2016

International rates are different and various sites can negotiate those.  Ebay did and did a very good job considering the extremely high rates.  And they negotiated better discounts on International FCP than any other site that I've ran across [that includes Amazon].

The extremely high increases to international rates by USPS is a completely different subject.  But Scotty you are absolutely correct, it has significantly reduces international sales.

@postalwizard

Please share with us any site that did negotiate Domestic FCP rates.  Or are you just referring to International FCP?  Ebay, Stamp.com, Amazon, etc.  None have ever been able to negotiate Domestic FCP before.  All these sites have always had the same rates for Domestic FCP.  

Base & CPP haven't been merged yet.  That doesn't happen until next year.  It hasn't been announce yet, at least not to my knowledge, if they are going with the deeper discounts of CPP or the lower discount of CBP.

http://www.prc.gov/docs/93/93759/Order%20No.%202814.pdf>
On
page four of the above linked document, CBP and CPP are NOT negotiable.  It goes on to list which methods can be negotiate.  

Equivalent Commercial Base and Plus prices. Commercial Plus prices will be
equivalent to Commercial Base prices and DEEPER DISCOUNTS MAY be available to customers through negotiated service agreements for Priority Mail Express, Global
Express Guaranteed, Priority Mail Express International, Priority Mail International, and First-Class Package International Service.

USPS Allowed to Negotiate FCPS Rates?   USPS Allowed to Negotiate FCPS Rates?

by: MostlyArt This user has validated their user name.

Wed Aug 3 00:12:55 2016

The First Class International on small packages (under 3 ounces) is up to $12.78 now.  I used to have a pretty good business with the UK and Scandinavia, but it is down to nothing now.  I even split the cost of postage, but the business is just gone.  It's a shame...

USPS Allowed to Negotiate FCPS Rates?   USPS Allowed to Negotiate FCPS Rates?

This user has validated their user name. by: Bill

Wed Aug 3 00:49:50 2016

I used to sell International until the price increases took all my customers away.
As it is with anything in Washington they print one thing and do the deals on their own. eBay, Amazon and Stamps.com all get a small discounted price from the listed price otherwise they would not be in the postage business. Anyone who thinks they do not I have a least a 100 bridges I can sell you.

USPS Allowed to Negotiate FCPS Rates?   USPS Allowed to Negotiate FCPS Rates?

by: IndyTom This user has validated their user name.

Wed Aug 3 09:52:01 2016

And yet...China can mail to the US for pennies???

USPS Allowed to Negotiate FCPS Rates?   USPS Allowed to Negotiate FCPS Rates?

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

Wed Aug 3 11:54:12 2016

IndyTom you are so right. I just had this exact discussion with Stamps.com yesterday. The playing field is so set against the USA and that is why we are in deep do-do right now. MY international sales disappeared since 2015. For heavier items UPS is now 40% cheaper that USPS Priority within the US. AND DC COULD CARE LESS ABOUT HELPING US!

USPS Allowed to Negotiate FCPS Rates?   USPS Allowed to Negotiate FCPS Rates?

by: Postalwizard This user has validated their user name.

Wed Aug 3 12:34:29 2016

@ Marie

I respectfully disagree.  CBP and CPP for FCPS did merge under "Commercial" in Jan 17th rate change.

There is no way of knowing who the companies are that have been successful negotiating discounts on FCPS as names are redacted as are amounts.  Since none have ever seen the light of day one could assume that the holder is receiving the arbitrage.  Yet you are right that the common word is that the USPS does not discount FCPS, yet why all the PRC filings that include FCPS?

USPS Allowed to Negotiate FCPS Rates?   USPS Allowed to Negotiate FCPS Rates?

This user has validated their user name. by: Marie

Wed Aug 3 13:11:53 2016

@postalwizard

No one can negotiate of Domestic FCP.  I gave the link above to the document that states that in more places than just the one I noted.

What any company earns from USPS for selling FCP or postage in general on their website is a COMPLETELY different subject.

You can verify this by randomly testing various sites that offer you the ability to print postage online.  ALL sites offering DOMESTIC FCP have the same rates.  In my testing I've found NO exception.  And the same has held true in previous years.

The misunderstanding on this fact is what causes a fire storm of complaints from Ebay sellers every time there is an increase in Domestic FCP rates.  Many get upset at Ebay for not negotiating the rates better.  But what many don't understand, is you can't negotiate something that isn't negotiable.

We may have to agree to disagree on the CBP and CPP matter.  My understanding of the document linked above is that 2016 they are using the CPP rates.  In 2017 they are doing away with CPP and as you say, go to a rate just called ''commercial''.  However to my knowledge they haven't said if when they change it to just a commercial rate if they are going to be using the higher discount we've seen with CPP or if it will be the lower discount of CBP.

But with that said, I'm not sure the distinction is really important enough to continue a debate on.  



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