Categories: Business

U.S. postal treaty exit would hurt Canadian e-commerce businesses

U.S. President Donald Trump’s push to withdraw from an international postal treaty could have a big impact on Canadian e-commerce companies and their American customers.

The U.S. threat to exit the Universal Postal Union in October unless more balanced shipping fees with China and other countries can be reached this month means online retailers could see direct-to-consumer delivery prices shoot up.

The 145-year-old treaty, which sets the rates that nearly 200 national postal services pay one another to complete deliveries, mandates wealthier countries to pay more than developing countries, including China.

READ MORE: CryptoKitties — Are blockchain Beanie Babies the future of e-commerce or a fad?

Todd Coupland, an analyst at CIBC World Markets, says the Trump administration’s move for the United States Postal Service to set its own rates would affect drop-shipping, which refers to retail deliveries made directly to the buyer from a manufacturer or wholesaler.

Many drop-shippers in Canada use Shopify Inc. as their retail platform, meaning a dip in deliveries and more shuttered online storefronts could dent Shopify’s bottom line, which relies on payment-processing fees and user subscriptions.

In an email, the U.S. Postal Service says it supports the goals of the Trump administration to secure a more balanced remuneration system for small goods shipments, and that it will not leave the postal treaty if better terms are set before the union’s next meeting in mid-October.

The Canadian Press

READ MORE: Comox Valley artisans join new local e-commerce platform

READ MORE: New e-commerce project helps market Alberni Valley growers

Like us on Facebook and follow us on Twitter

The Canadian Press

Share
Published by
The Canadian Press

Recent Posts

  • Business
  • Home2

March job losses just ‘a tiny snapshot’ of full impact of COVID-19: B.C. professor

Some sectors and demographics likely to be hardest hit

45 mins ago
  • Home2
  • News

COVID-19 death toll reaches 50 in B.C., while daily case count steadies

B.C. records 34 new cases in the province, bringing total active confirmed cases to 462

1 hour ago
  • Home
  • Local News
  • News

Disinfectant wipes and sanitizer being stolen out of cars in Fraser Valley

RCMP reminding vehicle owners to remove all valuables from cars, even cleaning supplies

1 hour ago
  • Home2
  • News

Fraser Health doctors thank Henry, Lee for steady hands, compassionate messages

Letter a ‘unanimous show of support’

1 hour ago
  • Home
  • Local News
  • News

Cyrus Centre takes Easter dinner on the road for youth

Centres in Abbotsford and Chilliwack preparing to deliver meals to their youth and families

2 hours ago
  • Home2
  • News

Researchers to study whether plasma of recovered patients can treat COVID-19

Plasma is the liquid portion of the blood that contains the antibodies that protect against illness

2 hours ago