Stamps.com rocked the shipping world when it revealed its relationship with USPS was changing in a drastic way. Stamps.com CEO Ken McBride said he no longer sees an exclusive partnership with the USPS as the right strategy for Stamps.com, and he outlined a new strategic direction for the company while keeping Amazon’s growing presence in mind.
“When our customers are offered services such as Shipping with Amazon, FedEx One Rate, UPS’s new products, regional carriers, Uber shipping, ship from store, and everything else – we have to bring those solutions to our customers so that they can always choose the best alternative for their business,” McBride said during a conference call with Wall Street analysts to discuss fourth quarter earnings.
It’s difficult to pin down ramifications and the winners and losers of this development; keep in mind the company’s brands and solutions include Stamps.com, Endicia, ShipStation, ShipWorks, ShippingEasy, and MetaPack.
Let’s look at how Thursday’s revelations impact online sellers who use Stamps.com services, at least for the immediate future. We checked in with Eric Nash, Senior Director of Online Marketing for Stamps.com.:
Will users of Stamps.com and Endicia still be able to use USPS services? And for how long?
Eric Nash: “Nothing changes in Stamps.com services and features that we offer, including USPS services (the announcements in the earnings call are unrelated to our PC Postage license which continues without impact).
“Stamps.com customers will continue to receive all existing USPS rates (Commercial Base Pricing) for packages and the Metered Mail rate for First Class Mail letters.”
Will they have to pay more to use Stamps.com and Endicia? (All or some sellers?)
Eric Nash: “The bulk of our customer base will not pay anything additional. For a limited group of high volume customers that have specialized negotiated rates with the USPS (known as NSA), we will look at implementing surcharges as needed so that we are compensated for the technology and services we provide.”
Will they be offered services from other carriers, including FedEx and UPS?
Eric Nash: “Going forward, we plan to add even more great carrier services and features with the goal of offering the best mailing and shipping platform for domestic and International shipping services.”
During Thursday evening’s conference call, McBride provided a detailed look at the shipping industry and an assessment of the major shipping carriers.
He pointed to the challenges facing the US Postal Service, and he also pointed to Amazon’s move into the shipping business. “We’re going to align ourselves with the carriers that we think are going to be the winners in the shipping business,” he said.
Amazon has taken direct aim at the package business, and its track record of disrupting an industry is well established, McBride said. “Their threat should be taken very seriously by every player in the shipping industry. We are setting our corporate strategy assuming Amazon will be a big global player in shipping.”
McBride noted that Stamps.com would continue to use USPS, but in many segments, it would begin bringing in more competitive products from other carriers, he said. “We are currently in discussions or already have partnerships with all of the major incumbent private carriers and we’re also in discussion with many of the new entrants into the U.S. shipping business.”
You can find a full transcript of the earnings call on SeekingAlpha.com.
UPS always RUINS my stuff. If I put a “Fragile” sticker on the box, UPS beats the daylights out of it. Then they tell me it’s My fault and they refuse to pay out.
FedEx has NO HUB here, making it impractical to use.
USPS is the only choice that makes any sense.
Why can’t they stop messing with stuff that “ain’t broke” ?
You’re right, UPS can mess up every package it carries. To their credit–they do handle heavier items than USPS, and move packages (probably) too fast, which leads to tossing & dropping. Maybe if Amazon took the burden off of them–they’d have more time to treat packages with more care.