Fact Check: The Math Adds Up for Trump’s Claim That USPS Undercharges Amazon

[Voice of Reason 10,298]

“Why is the United States Post Office, which is losing many billions of dollars a year, while charging Amazon and others so little to deliver their packages, making Amazon richer and the Post Office dumber and poorer? Should be charging MUCH MORE!” Trump said in a tweet posted on Friday.

 

Trump’s claim that the USPS is losing billions of dollars is entirely correct, in 2016 the USPS announced a $5.6 billion net loss and in 2017 stated a $2.7 billion net loss, making this the eleventh year that the Postal Service has announced a loss. The total from 2007-17 amounts to a staggering $65.1 billion in losses. Things do not seem to be looking up for the organization anytime soon, with the USPS predicting in their public 2018 Integrated Financial Plan that they would suffer a net loss of $5.2 billion in 2018. With mail volume at a 29 year low and amassing large amounts of debt, the Postal Service is facing a tough time ahead.

 

http://www.breitbart.com/tech/2017/12/29/fact-check-the-math-adds-up-for-trumps-claim-that-usps-undercharges-amazon/?utm_source=facebook&utm_medium=social

[The Nature Boy 7,659]

My question is do they charge them less than ups and FedEx and they are losing because of that or are  they just less efficient.. 

 

I know FedEx use to use smart post. FedEx would pick up the package and charge the customer, then  aggregate the packages at their DC and deliver to the local post office for to door delivery. 

 

I think UPS and FedEx still do this. I can recall driving a FedEx truck to the post office on several occasions 

[The Nature Boy 7,659]

I will add that both FedEx and Amazon are notoriously terrible companies to work for 

[yuna628 9,712]

USPS often works with FedEx anyway for Amazon packages. It makes sense they charge less - they will mostly be handling non bulk merchandise and moving your prime packages fast. If they raised their rates, it's doubtful Amazon would use them as a first choice. But there's other reasons why the prices are fixed -- there is a government cap law on the USPS itself.. so perhaps POTUS should be looking within.  If USPS wants to be at least the primary carrier for Amazon... they pretty much have to meet the company demands.

 

Other reasons why USPS takes in less money isn't because of their rates, which I think are pretty fair in some aspects and not fair in others (international shipping can be a nightmare) - but simply because with the advance of technology, we're not sending as many letters as we used to. Think about it - we email instead of writing letters... we online bill pay instead of sending off a check. These are all enormous reductions in the volume of mail USPS handles. The only calculations done on how much USPS would have to charge to be 'competitive' have never been done by outside or internal sources -- it's actually been number crunched by UPS/FedEx, which as their largest competitors could be fudging the numbers... and would stand the most to gain by any potential price raise. The board for the USPS actually just recommended a rate increase, which may improve their bottom line slightly, and continues to recommend that congress act to fix the laws governing the cap on prices.

 

1 hour ago, Nature Boy Flair said:

I will add that both FedEx and Amazon are notoriously terrible companies to work for 

Yep. Hubby actually tried to work for FedEx. The hiring process was ridiculous, but he did well on every single test they gave him. They rejected him supposedly because he was ''over qualified'' but honestly, they didn't seem to understand what an EAD was. Probably was for the best and it worked out for the better in the end.

[bcking 3,157]

While Amazon doesn't need to be worth any more money, I also think they undercharge customers for the Prime benefit. 100 bucks for an entire year of 2 day shipping (even if that was all it got you, ignoring the TV shows/Movies) is very low. I probably break even after 2 or 3 months.

 

Not enjoying USPS right now though. I had around 250 dollars of merchandise coming to my home last Wednesday which was "delivered to resident" according to USPS. My wife and I were in our living room near our front door all evening and never got anything. They now have no idea where it is.  Fortunately Amazon has said they will just refund the whole thing if USPS can't find it.

[bcking 3,157]

20 minutes ago, yuna628 said:

Other reasons why USPS takes in less money isn't because of their rates, which I think are pretty fair in some aspects and not fair in others (international shipping can be a nightmare) 

 

Off topic but -

 

How do you ship goods to the UK? It was the first year of my wife here for Christmas and we were trying to send presents to family and friends and the shipping costs were absolutely ridiculous. We were receiving 5 pound boxes from people in the UK that cost them around 20 pounds to ship. For us to send a similar package would have been over 100 dollars. We ended up buying most of our gifts on amazon.co.uk, or john lewis or some other UK company and having them gift wrapped and sent directly.

[yuna628 9,712]

2 minutes ago, bcking said:

Off topic but -

 

How do you ship goods to the UK? It was the first year of my wife here for Christmas and we were trying to send presents to family and friends and the shipping costs were absolutely ridiculous. We were receiving 5 pound boxes from people in the UK that cost them around 20 pounds to ship. For us to send a similar package would have been over 100 dollars. We ended up buying most of our gifts on amazon.co.uk, or john lewis or some other UK company and having them gift wrapped and sent directly.

USPS. The fee with tracking for a 5 day or so window runs about $70. Yes it is expensive, but that's what we have to do. We limit it to two boxes per year at Xmas and send anything additional via UK Amazon . You can send it 1st class if small enough for cheap, but it could take a month and there's no tracking. Tracking is important to us, because while I have confidence that we on our end gets it to the UK, we've too often seen what happens when it arrives at his family's UK shipping depot. I have no confidence in using UPS for the task because I've been burned by them badly before.

 

What you do have to be careful about however, is ensuring whatever the cost of the items you are putting in the box is under the UK's customs regulation for non-EEA members. It's something like 30 quid... and if you go a cent over, the UK family then gets the package held hostage at the depot until they pay 'ransom'.. which is typically just as expensive as the cost you paid to ship it! The other problem for us is finding a USPS employee that actually knows how to send international mail (do it wrong and you've got problems)..... it's bad enough that sometimes I've had to walk out of our town's post office and travel to the next state over just to have them know what to do. 

 

I've no idea how the UK packages get to the US so cheap. My husband always used Royal Mail which was pricey. His dad likes to use a cheapo courier service, but this year the box never made it out of the depot and an employee stole about 100 quid worth of chocolate (husband was gutted!). He's trying again this year, and hopefully he'll listen about using RM this time around. It's been 13 years of sending international packages between us, it's always expensive, and we just try to budget it... I like having our family across the pond hand-wrapped gifts to open on xmas. When you think about the cost to use a UK site with the exchange rate loss, card fee,  inflated price and gift wrap charge, we figure it equals out.

[yuna628 9,712]

42 minutes ago, bcking said:

While Amazon doesn't need to be worth any more money, I also think they undercharge customers for the Prime benefit. 100 bucks for an entire year of 2 day shipping (even if that was all it got you, ignoring the TV shows/Movies) is very low. I probably break even after 2 or 3 months.

 

Not enjoying USPS right now though. I had around 250 dollars of merchandise coming to my home last Wednesday which was "delivered to resident" according to USPS. My wife and I were in our living room near our front door all evening and never got anything. They now have no idea where it is.  Fortunately Amazon has said they will just refund the whole thing if USPS can't find it.

Oh how many times I have ripped our postman a new one for doing the exact thing. You get to know your rural carriers pretty well, and it has become a running joke how many items he can mysteriously lose (he loses pieces of mail every month so thank god when it's a bill they have e-pay.. it may not be his fault because if you saw what our rural office looks like you'd understand -- seriously I don't think the sorters can read and the filing system is... disturbing). Ride his case enough and he does come through and correct his mistakes.. but we've had it happen with fedex/ups too.. and they never bother to make things right. We got the postman in big trouble this year, for delivering our incoming international package to the wrong house (it's supposed to be signed for.. he never bothers). It took about four days of back and forth, but he went back to each house along his route and found he'd delivered it wrongly three streets over. His excuse was ''oh that lady always gets packages from the UK so I just assumed..." Don't. Even. 

Edited January 1, 2018 by yuna628

[bcking 3,157]

28 minutes ago, yuna628 said:

USPS. The fee with tracking for a 5 day or so window runs about $70. Yes it is expensive, but that's what we have to do. We limit it to two boxes per year at Xmas and send anything additional via UK Amazon . You can send it 1st class if small enough for cheap, but it could take a month and there's no tracking. Tracking is important to us, because while I have confidence that we on our end gets it to the UK, we've too often seen what happens when it arrives at his family's UK shipping depot. I have no confidence in using UPS for the task because I've been burned by them badly before.

 

What you do have to be careful about however, is ensuring whatever the cost of the items you are putting in the box is under the UK's customs regulation for non-EEA members. It's something like 30 quid... and if you go a cent over, the UK family then gets the package held hostage at the depot until they pay 'ransom'.. which is typically just as expensive as the cost you paid to ship it! The other problem for us is finding a USPS employee that actually knows how to send international mail (do it wrong and you've got problems)..... it's bad enough that sometimes I've had to walk out of our town's post office and travel to the next state over just to have them know what to do. 

 

I've no idea how the UK packages get to the US so cheap. My husband always used Royal Mail which was pricey. His dad likes to use a cheapo courier service, but this year the box never made it out of the depot and an employee stole about 100 quid worth of chocolate (husband was gutted!). He's trying again this year, and hopefully he'll listen about using RM this time around. It's been 13 years of sending international packages between us, it's always expensive, and we just try to budget it... I like having our family across the pond hand-wrapped gifts to open on xmas. When you think about the cost to use a UK site with the exchange rate loss, card fee,  inflated price and gift wrap charge, we figure it equals out.

Ya I have no idea how it's so cheap. One box my wife got from a friend was about 5-6 pounds and the price was on the box itself...like 18 quid or something. Her friend had only sent it 2 weeks earlier so it didn't take that long either (It had mostly UK chocolates, tea and some other "bits of home").

 

I thought when I was in USPS it was around 110 dollars, but maybe I wasn't looking at the right ones. The flat rate boxes?  The smallest ones hardly hold anything. We've looked at using some of the online courier services, but I have no idea how reliable they are (Parcel Monkey? Seems cheaper). The VAT waiver is per item correct? I think I looked it up and it was 39 pounds, but I thought that was per item.

 

Ordering online worked okay, at least this year. My wife still has a UK bank account with money in it that we never moved (It's nice to have a UK account when we go back to visit, don't need to deal with exchange rates). So we just used that money for gifts. We minimized gift wrapping by sending gifts for her parents to her sister (who then wrapped), and vice versa. Not sure if they will support that long term though

 

13 minutes ago, yuna628 said:

Oh how many times I have ripped our postman a new one for doing the exact thing. You get to know your rural carriers pretty well, and it has become a running joke how many items he can mysteriously lose (he loses pieces of mail every month so thank god when it's a bill they have e-pay.. it may not be his fault because if you saw what our rural office looks like you'd understand -- seriously I don't think the sorters can read and the filing system is... disturbing). Ride his case enough and he does come through and correct his mistakes.. but we've had it happen with fedex/ups too.. and they never bother to make things right. We got the postman in big trouble this year, for delivering our incoming international package to the wrong house (it's supposed to be signed for.. he never bothers). It took about four days of back and forth, but he went back to each house along his route and found he'd delivered it wrongly three streets over. His excuse was ''oh that lady always gets packages from the UK so I just assumed..." Don't. Even. 

Because of the holiday I haven't been able to follow-up yet. I'll check in tomorrow. I figure it was scanned as "hand delivered to resident" so they can't even pull the "I left it outside, someone must have stolen it" routine. They claim they "hand delivered" and it never touched our hands. It must have been the wrong house. The person on the phone said they should be able to look at the gps on the scanner to see where they were when they scanned it as hand delivered, to see if they were on the wrong street, or a few doors down etc... We are friends with our neighbors on either side of us (Our houses are quite similar) so I know if it went to either of them they would have handed it over. I'm wondering if they delivered it one street up or down (we live on a numbered street so maybe they were just one off).

 

We'll see. The first thing the Amazon rep said was "We'll contact USPS, but if they can't find it don't worry we will refund you or send you a new one", so at least right now I like Amazon. Fortunately we just need the stuff before our holiday in February so we have time.

Edited January 1, 2018 by bcking

[-Trinity- 513]

1 hour ago, bcking said:

had around 250 dollars of merchandise coming to my home last Wednesday which was "delivered to resident" according to USPS. My wife and I were in our living room near our front door all evening and never got anything. They now have no idea where it is.  Fortunately Amazon has said they will just refund the whole thing if USPS can't find it.

We had the same problem with USPS last week. What we figured out is they delivered the package to neighbors in the street who have the same house number, but other side of the street. We are on the North and they are on the South side and we both have the same house number (who came up with that idea ?)

 

Still the mailman knows this, but when someone else is working that day they always deliver our mail there and theirs to us. USPS is horrible.

 

Shipping from the Netherlands to the US is also very cheap compared to the US prices. 

Edited January 1, 2018 by -Trinity-

[yuna628 9,712]

2 minutes ago, bcking said:

Ya I have no idea how it's so cheap. One box my wife got from a friend was about 5-6 pounds and the price was on the box itself...like 18 quid or something. Her friend had only sent it 2 weeks earlier so it didn't take that long either (It had mostly UK chocolates, tea and some other "bits of home").

 

I thought when I was in USPS it was around 110 dollars, but maybe I wasn't looking at the right ones. The flat rate boxes?  The smallest ones hardly hold anything. We've looked at using some of the online courier services, but I have no idea how reliable they are (Parcel Monkey? Seems cheaper). The VAT waiver is per item correct? I think I looked it up and it was 39 pounds, but I thought that was per item.

 

Ordering online worked okay, at least this year. My wife still has a UK bank account with money in it that we never moved (It's nice to have a UK account when we go back to visit, don't need to deal with exchange rates). So we just used that money for gifts. We minimized gift wrapping by sending gifts for her parents to her sister (who then wrapped), and vice versa. Not sure if they will support that long term though

 

Because of the holiday I haven't been able to follow-up yet. I'll check in tomorrow. I figure it was scanned as "hand delivered to resident" so they can't even pull the "I left it outside, someone must have stolen it" routine. They claim they "hand delivered" and it never touched our hands. It must have been the wrong house. The person on the phone said they should be able to look at the gps on the scanner to see where they were when they scanned it as hand delivered, to see if they were on the wrong street, or a few doors down etc... We are friends with our neighbors on either side of us (Our houses are quite similar) so I know if it went to either of them they would have handed it over. I'm wondering if they delivered it one street up or down (we live on a numbered street so maybe they were just one off).

 

We'll see. The first thing the Amazon rep said was "We'll contact USPS, but if they can't find it don't worry we will refund you or send you a new one", so at least right now I like Amazon. Fortunately we just need the stuff before our holiday in February so we have time.

Nope, the customs VAT charge is per box and not per item. It changes every year or so too. We used to be able to send a lot to the UK and be under the fee, now we can't. We just cobble together whatever box we have at home and send it Priority Mail Express International.. you can also send it GXG and get it there within 3 days but that does cost more and honestly PMEI gets it there within 3-5 anyway. It will cost a little more if the box is super heavy, but they typically just charge us around $70.

 

Ah but how many times he has claimed to hand deliver things... and he's actually just tossed it on the front step. They should be able to look it up in theory, but as was the case for our guy, he never bothered to scan anything. He had no clue what house he delivered it to. Amazon does generally come through in refunds so I hope they do find it for you.

[Steeleballz 7,550]

1 hour ago, bcking said:

While Amazon doesn't need to be worth any more money, I also think they undercharge customers for the Prime benefit. 100 bucks for an entire year of 2 day shipping (even if that was all it got you, ignoring the TV shows/Movies) is very low. I probably break even after 2 or 3 months.

 

Not enjoying USPS right now though. I had around 250 dollars of merchandise coming to my home last Wednesday which was "delivered to resident" according to USPS. My wife and I were in our living room near our front door all evening and never got anything. They now have no idea where it is.  Fortunately Amazon has said they will just refund the whole thing if USPS can't find it.

 

  Not to mention the cheapskates like me who just do the free month and then cancel. 

Edited January 1, 2018 by Steeleballz

[bcking 3,157]

22 minutes ago, yuna628 said:

Nope, the customs VAT charge is per box and not per item. It changes every year or so too. We used to be able to send a lot to the UK and be under the fee, now we can't. We just cobble together whatever box we have at home and send it Priority Mail Express International.. you can also send it GXG and get it there within 3 days but that does cost more and honestly PMEI gets it there within 3-5 anyway. It will cost a little more if the box is super heavy, but they typically just charge us around $70.

 

Ah but how many times he has claimed to hand deliver things... and he's actually just tossed it on the front step. They should be able to look it up in theory, but as was the case for our guy, he never bothered to scan anything. He had no clue what house he delivered it to. Amazon does generally come through in refunds so I hope they do find it for you.

The UK.gov site says you can get a separate gift exemption if the gifts are for different people, even if they are in the same box.

 

Something to keep in mind for the future.

 

https://www.gov.uk/goods-sent-from-abroad/gifts

[jg121783 3,921]

6 hours ago, Nature Boy Flair said:

I will add that both FedEx and Amazon are notoriously terrible companies to work for 

Part of one of my side businesses is selling products on Amazon and I will say their customer service for 3rd party sellers (which makes up a majority of their sales) is terrible. If you have an issue good luck contacting a person by phone and if you do it's someone in India who has no idea what they are doing. There are some other issues I won't get into. That being said it is still a good way to make some money as you just ship your products to Amazon and they do the rest. As far as Amazon employees go I have seen horror stories about how their treated but haven't seen first hand.

 

I have seen the USPS shipping costs from the other side as a seller and I will say Amazon charges the seller more than enough shipping fees (among other seller fees) to pay USPS their fair share not to mention the many millions they bring in every year from prime memberships. Seems to me they are taking advantage of the system and Trump wants to put an end to it. Whether he can or not who knows.

 

4 hours ago, bcking said:

While Amazon doesn't need to be worth any more money, I also think they undercharge customers for the Prime benefit. 100 bucks for an entire year of 2 day shipping (even if that was all it got you, ignoring the TV shows/Movies) is very low. I probably break even after 2 or 3 months.

 

Not enjoying USPS right now though. I had around 250 dollars of merchandise coming to my home last Wednesday which was "delivered to resident" according to USPS. My wife and I were in our living room near our front door all evening and never got anything. They now have no idea where it is.  Fortunately Amazon has said they will just refund the whole thing if USPS can't find it.

I agree prime memberships should cost more. I would personally pay $200 or more and still get my money's worth out of it as I am sure others would. Thats good that Amazon took care of your issue but what most Amazon buyers don't realize is when they get a refund due to Amazon or the shipper screwing up it is taken directly from the 3rd party seller of the product even if it isnt their fault in any way and it is a nightmare as a seller to get Amazon to correct this. I had this happen to about $500 in inventory recently. You were in the right asking for a refund but Amazon was probably in the wrong penalizing the 3rd party seller.

[bcking 3,157]

20 hours ago, jg121783 said:

Part of one of my side businesses is selling products on Amazon and I will say their customer service for 3rd party sellers (which makes up a majority of their sales) is terrible. If you have an issue good luck contacting a person by phone and if you do it's someone in India who has no idea what they are doing. There are some other issues I won't get into. That being said it is still a good way to make some money as you just ship your products to Amazon and they do the rest. As far as Amazon employees go I have seen horror stories about how their treated but haven't seen first hand.

 

I have seen the USPS shipping costs from the other side as a seller and I will say Amazon charges the seller more than enough shipping fees (among other seller fees) to pay USPS their fair share not to mention the many millions they bring in every year from prime memberships. Seems to me they are taking advantage of the system and Trump wants to put an end to it. Whether he can or not who knows.

 

I agree prime memberships should cost more. I would personally pay $200 or more and still get my money's worth out of it as I am sure others would. Thats good that Amazon took care of your issue but what most Amazon buyers don't realize is when they get a refund due to Amazon or the shipper screwing up it is taken directly from the 3rd party seller of the product even if it isnt their fault in any way and it is a nightmare as a seller to get Amazon to correct this. I had this happen to about $500 in inventory recently. You were in the right asking for a refund but Amazon was probably in the wrong penalizing the 3rd party seller.

I didn't realize that. That's definitely wrong. I would expect Amazon to get it back from USPS. It seems pretty clearly their fault in this situation. I'm calling them later today for an update though so we'll see.