I can vouch for that myself.
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Trump hits Amazon again
- Thread starter Calminian
- Start date
The tariffs are a smart negotiating tool. China is in panic mode. They threw out everything they had in one swoop. They taxed pork and the largest pork producer in the USA is Chinese owned. They are in panic mode.
Trump is not picking winners and losers. Obama did that. Trump is merely calling out large scale abused of the taxpayer perpetrated by certain gross offenders.
Oh man. This is just the opening salvos in the war. It's possible the Chinese owned pork producer is getting an exclusion from the tariffs. Did you think of that?
I presume you are referring to Amazon's discounted rates on package shipments. That is the fault of the US Postal Service. They never should have agreed to such low rates in the first place. Bashing Amazon for making a good deal is very unproductive.
Take a look for yourself. I would call a 14.3% increase in the cost of shipping a small flat rate box a significant increase in price. If you like I can post the first class mail letter rates as well.
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Maybe. They are basically the only U.S. pork exporter. That would really show their desperation.
Maybe Trump was talking about the bulk rate.
Maybe Trump doesn't know what he's talking about. Wouldn't be the first or the hundredth time.
He said that Amazon's "subsidy" is costing taxpayers billions of dollars a year. Well, the USPS receives no taxpayer money.
The Top 10 Things You Should Know
About the U.S. Postal Service
And most importantly…
1.
The Postal Service receives NO tax dollars for operating expenses and relies on the sale of postage, products and services to fund its operations.
Top 10 Things You Should Know About USPS - Postal Facts
I do a little bit of business with Amazon, so I know what I'm talking about...
The Post Office loses $1.46 per parcel.
The $1.46 comes from an analysis from CitGroup in 2017 (which was picked up by The Wall Street Journal and Forbes).
https://ir.citi.com/XInLvxkr5F/JvyPr1NMl/PcIgrn+XqplW8cqbv2ImZxLKrWAiRT+cFMjQe6C+uQT9n1mvCnznGU=
The USPS, for its part, maintains that it does not price its competitive products below cost (which is prohibited by law).
USPS CFO responds to Wall Street Journal article
There is a range of opinion about how the overhead costs (including the prefunding of pensions) should be allocated among the various segments of the USPS' operations. It's a Herculean job, I would suspect, given the mammoth size of the organization and the fact that Congress has mandates on its monopoly services.
How, for example, do you apportion overhead on a rural route on which, say, 21 customers have first-class mail, 10 customers have magazines delivered and nine people get packages?
It does appear that there is some room for the USPS to raise prices on parcels, but that may or may not make sense in the long run. Amazon uses combinations of carriers, often shipping a package to a large center, then handing it over to the post office for the last leg of the journey — because it's cheaper. Amazon is so huge that it may just build out its delivery system to cut out the post office, which means even less revenue for the USPS.
https://ir.citi.com/XInLvxkr5F/JvyPr1NMl/PcIgrn+XqplW8cqbv2ImZxLKrWAiRT+cFMjQe6C+uQT9n1mvCnznGU=
The USPS, for its part, maintains that it does not price its competitive products below cost (which is prohibited by law).
USPS CFO responds to Wall Street Journal article
There is a range of opinion about how the overhead costs (including the prefunding of pensions) should be allocated among the various segments of the USPS' operations. It's a Herculean job, I would suspect, given the mammoth size of the organization and the fact that Congress has mandates on its monopoly services.
How, for example, do you apportion overhead on a rural route on which, say, 21 customers have first-class mail, 10 customers have magazines delivered and nine people get packages?
It does appear that there is some room for the USPS to raise prices on parcels, but that may or may not make sense in the long run. Amazon uses combinations of carriers, often shipping a package to a large center, then handing it over to the post office for the last leg of the journey — because it's cheaper. Amazon is so huge that it may just build out its delivery system to cut out the post office, which means even less revenue for the USPS.
If someone were to ship a 20 lb. package via UPS ground to a zone 4 commercial address it would cost them $15.12. (Think of a Zone 4 address as being 500-600 miles away.)
When I ship packages that weigh 20 lbs. via UPS ground to commercial customers in UPS zone 4 using my UPS account and the discount program I am on, it costs my company $11.79. That's about a 22% discount.
When I ship packages that weigh 20 lbs. via UPS ground to an Amazon distribution center in UPS zone 4 using Amazon's discounted rates it costs me $7.84. That is a 48% discount. Behold the power a large volume customer has over a transportation company. I presume Amazon wields the same power with the US Postal Service.
When I ship packages that weigh 20 lbs. via UPS ground to commercial customers in UPS zone 4 using my UPS account and the discount program I am on, it costs my company $11.79. That's about a 22% discount.
When I ship packages that weigh 20 lbs. via UPS ground to an Amazon distribution center in UPS zone 4 using Amazon's discounted rates it costs me $7.84. That is a 48% discount. Behold the power a large volume customer has over a transportation company. I presume Amazon wields the same power with the US Postal Service.