Personal Experience – USPS is 2x MORE EXPENSIVE and 44 Days SLOWER than UPS Saver in Shipping to Japan

FINALLY!!!
On 4 December, an amazon market place seller shipped a magazine to me (using USPS airmail). The anticipated delivery time was between 25 and 32 days.

Last week, I wrote to them asked them to track the item as the only tracking information I got on the amazon.com site was that the item had been “received at the facility in Texas” on 4 December.

As it was day 45 since shipment, the seller decided it was best to give me a full refund because the magazine was no longer available for re-shipping.

Today, on day 49, I received the shipment.

I have to say that the customer service representative was right when she wrote, “you will receive the magazine one day.”

I asked her if she wanted to know if and when I ever get the item, and she responded in something that read like “don’t bother, keep the money, go away.” I suspect this happens often because on amazon market place and eBay, merchants are evaluated by the consumers on responsiveness to inquiries, and whether the items were received in the promised time.

Of course, the customer service rep was quick to point out that the delay is not their fault. And as an industry insider, I was happy to accept that. Still…

The magazine was US$8.00. I was charged $12.80 for shipping.

While I believe the yardstick or rule of thumb is that most consumers would accept around 10% of the value of the goods as shipping charge, I opted to pay more for shipping than I did for the publication because it was something I could not get in Japan. When the refund was issued, I got the entire sum back.

The ironic thing is that when I ordered two books, worth $55, from a different merchant on amazon market place, I received it in 5 days and via UPS Saver, and the shipping charge was only $6.88.

I told the CS rep that, and suggested that they look into getting UPS Saver instead of using USPS, and she said,

“UPS is too expensive for yarn and books.” (But I just told her that it is actually CHEAPER!)

There are a couple of things to learn from this:

1) UPS has a ways to go to get merchants to understand that they have a competitive shipping option as their image as an express courier is that they are too expensive for people who ship bulky but light stuff where volumetric pricing makes it prohibitive;

2) USPS needs to get their act together – their slower-than-molasses-in-winter delivery lead times are costing their customers business. In this case, it is obvious that the merchant was penalized for using USPS. Had they used UPS Saver, they would have had a happy customer (me) and kept their money. Now, they lost the customer and the entire taking for the transaction.

And it was “first class mail” – whatever that means in the US these days.

I know it was peak season, but when I sent something to the US via first class mail through Japan Post (an item I returned to amazon.com), I know it took under a week to be delivered as I got my refund in that space of time.

So why does it take 49 days when the item originates from the US? Where do they keep all the “first class mail” for over 45 days?

I am assuming that the delay is within USPS because once an item is handed over to the airline, it takes under 20 hours to get to a mail center in Japan. And Japan Post sorts and delivers within 2 business days. Customs may hold an item for inspection, but books usually come through quickly. So, if one assumes that the airline and Japan Post take a maximum of 5 days, the item was somewhere within USPS for 44 of the 49 days it took to get here…

UPS Saver shipping charge was $6.88 for a $55 purchase of books. It arrived in Japan in 5 days.

Royal Mail “delivering results” as profits increase 400% | Post & Parcel

Royal Mail “delivering results” as profits increase 400% | Post & Parcel.

400% increase in profits is no easy feat.  Very impressive.

But both the press release and the article in Post & Parcel clearly stipulate that while parcels, contributing 44% of the revenue, is a loss making operation at this time.

Royal Mail’s 2.2% operating profit margin, though a huge improvement from the 0.4% of the previous year, is still significantly lower than some competitors. (I am currently studying Yamato’s financial statements in detail and theirs indicate that their parcels operations bring in close to 5% operating profit margin.)

Of course no one can argue with Group CEO Moya Green when she says, “We recognise, however, that there is much more to be done.  Our commitment to executing our strategies is key. Our increased focus on the parcels market and our growing international businesses is helping to build a strong commercial future for the Group.”

And now the contrast between USPS, who continues to bleed money just by breathing, and Royal Mail Group will present an interesting comparison study going forward.  For Green to be able to say that RMG no longer has “going concern issues,” is a major step in removing one significant reason to keep the CEO up at night, no doubt.

The Post & Parcel article says that after a 30% retail price increase and 11% for business letters, revenue from parcels increased 10% while volumes went up by 6%. However, the article says, “Royal Mail said its parcel network was loss-making. The company is taking steps to reduce the losses, and said its cost allocation methodology for parcels was under review.”

While  automating letter sorting to delivery sequence increased from 8% two years ago to 75%, the 25% decline in letter traffic over six years means that this efficiency enhancement measure is merely plugging the bleeding a bit, rather than positively contributing to revenue and profit growth.  As such, clearly, ensuring that the growing parcels business turns around to become profit making is a priority focus for GLS.

For both competitors and alliance partners alike, how that will affect the way Royal Mail behaves in the other growth segment of international traffic will be of high interest.

 

 

SingPost faces $50,000 fine if letter targets are missed | Post & Parcel

SingPost faces tougher penalties if letter targets are missed | Post & Parcel.

 

From the current fine of $1,000 to $5,000, the Singapore regulator has upped the penalty to $50,000 per month per service category. The standards that need to be met are 99% next day delivery for letters posted within the CBD (Central Business District) by 3pm and 98% for those destined outside of the CBD.

 

Singapore is about 24km x 42km with a population of about 5 million residents.

 

It is also one of the handful of posts that have automated sorting to mailman’s delivery sequence with the 6-digit postal code.

 

According to Post & Parcel, “During 2011, SingPost achieved next working day delivery rates above 99.5% for items delivered inside the centre of Singapore, and above 99.1% for items going outside the centre.” Quite impressive and it looks as though SingPost doesn’t have to lose sleep over the new standards and high fines for the time being.

 

I recall from my Deutsche Post days a comment by then Chairman Dr. Klaus Zumwinkel that the German Post office was doing away with express mail delivery because 99% of letters are delivered the following day within Germany any way. And if Germany can do it with a significantly larger land mass and population, so should SingPost, I guess.