The US Postal Service announced it will no longer offer scanning and tracking services for some international Registered Mail destined for the United States. The move comes amid growing concern over an imbalance in shipping fees that puts US merchants at a competitive disadvantage against foreign retailers.
The Postal Service said the change is being made to improve the profitability of import Registered Mail items (those rates are governed by the Universal Postal Union, not the USPS) and to encourage international posts to shift their items from the import Registered Mail stream to the import ePacket product (whose rates are negotiated between international postal services).
ePacket itself has been criticized for not doing enough to correct the imbalance. In June, Amazon complained to Congress that U.S. sellers suffer under what he called a “frustrating” and “completely unnecessary and illogical” system whereby Chinese firms can ship low-weight orders to American buyers at significantly cheaper rates than are available to domestic sellers.
The Postal Service negotiated its ePacket delivery option with the intent of reducing its losses on international shipments. But in 2012, the Postal Service delivered 27 million ePacket shipments from China Post, losing an average of $1.10 on each piece – just five cents less than the typical losses under the terminal dues regime set by the UPU.
The Postal Service has said that it is trying to press for a better ePacket deal with China, but that its leverage is poor, given that China can always scrap the bilateral agreement and allow rates to revert to the more favorable UPU terminal dues.
Last year, the USPS Office of Inspector General issued a report on ePackets. At the time, the USPS said it was in negotiations with China Post on a new bilateral agreement “which would incorporate higher prices for ePackets and would reduce the losses associated with these items.”
Last month EcommerceBytes heard an unconfirmed report that ePacket rates from China were going up on Oct. 1st. The USPS failed to provide an answer about the accuracy of that report.
