Outbound international mailers brace for mid-year price increase
The International Mailers’ Advisory Group (IMAG) is warning outbound international mailers to prepare for a significant mid-August price increase that was not part of 2017 budgets. The price changes will affect two outbound international mail products offered by the US Postal Service (USPS): International Priority Airmail (IPA) and International Surface Air Lift (ISAL), which are both used heavily by sellers on e-commerce.
According to IMAG: “The price increase is due to a change in the negotiated service agreement contracts that the Postal Service has with outbound international consolidators, its workshare partners that perform onboarding, preparation and transportation services for international mailers and shippers. In the spring, the Postal Service determined that IPA and ISAL mail products were not covering their costs and it would need to adjust the discount structure in the agreements with consolidators. The result is price increases to both IPA and ISAL services that will take effect August 20, pending any adjustment to the timetable by the USPS.”
Kate Muth, Executive Director of IMAG, commented: “The association is disappointed the Postal Service could not time these contract changes to the annual price adjustment in January, and avoid hitting customers with a second and unexpected price increase mid-year.
“Regular, predictable price increases have been a constant refrain from the mailing industry. Unexpected pricing changes are disruptive and damaging to volumes and revenues, especially in a competitive market where customers have other choices.”
IMAG members have also voiced their dissatisfaction.
Steve Greenwalt, CEO of IMEX Global Solutions, an IMAG member, said: “We are extremely disappointed by the inopportune timing of these price increases and the inflexibility shown by USPS to its business partners and their international mail customers. Despite industry’s and IMAG’s efforts to push the changes to 2018, the international mail community is now forced to pass along these increases to the market.”