eCommerce Tips & Trends

Stamps.com Ends Exclusive Shipping Partnership with USPS

Michelle Mondonedo

by Michelle Mondonedo

On 2019 M02 22

by Michelle Mondonedo

It's official - Stamps.com has decided to start seeing other couriers.

In their Q4 2018 earnings call, Stamps.com announced that expected adjusted earnings per share would be a lot lower than analyst expectations, sending Stamps' stock price down almost 50% in after hours trading.

It was mentioned that these adjusted earnings were partially due to the effects of their exclusive partnership with USPS, prompting them to end their partnership so they can begin working with other couriers.

Why did Stamps.com end their partnership with USPS now?

According to Stamps.com CEO Kenneth McBride, "Our customers can no longer survive on just the USPS, and we don’t see that as a viable option for the next five years... this company can no longer be exclusive given the trends in the shipping market."

Clearly, consumer behavior around delivery preferences are being recognized by retailers. Customers maintain high expectations on delivery time frames and costs, viewing same day, 2-day shipping, and free shipping as required offerings at checkout.

These expectations cannot be met by the US Postal Service alone. By breaking their exclusivity agreement, Stamps.com is hoping to create partnerships with UPS, FedEx, and Amazon in order to provide the best solutions for their customers.

What does this mean for Stamps.com customers in the near-term?

While Stamps.com users will gain access to more services, it's possible that they may see price increases for USPS rates on the platform, as Stamps are no longer selling USPS rates exclusively. However, this isn't to say that online retailers will stop using USPS completely, now that other options are accessible.

USPS still provides competitive rates for domestic and international shipping, making it a popular choice for cost-conscious customers who are willing to wait for their deliveries.

Our thoughts on the Stamps.com breakup

From Day 1, Easyship has always seen the value of SMBs working with multiple couriers in order to provide the best delivery experience for their customers.

With the hundreds of couriers that exist worldwide, it's inevitable that certain companies will be able to provide shipping solutions that service specific markets better than a postal service can.

That's why our courier development team maintains partnerships with over 50 different shipping companies - so SMBs and crowdfunding campaigns will be able to find the best courier solution to any destination worldwide in the most cost-effective way.

For example, we partner with SF Express, a regional courier that specializes in delivery to Mainland China, and Aramex, who specializes in delivery to the Middle East and Africa.

US-based merchants who want to take advantage of these competitive rates from these regional couriers can do so through our multi-leg solutions. By choosing this option on our dashboard, USPS conveniently handles the first mile delivery, hands over to these regional couriers at a major US port, and the regional couriers in turn handle the last-mile delivery to the overseas destination.

Conclusion

Stamps.com's move away from exclusivity confirms our view that working with multiple couriers will be the best way for eCommerce businesses, regardless of size, to scale their business worldwide.


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