by Rockwell Sands @

Stamps.com Officially Ends Relationship with USPS

Stamps.com stock is in free fall as the dot com-era company ends longtime relationship with the US Postal Service, its biggest customer

It’s official! The longstanding shipping partnership Stamps.com and the US Postal Service is no more. As of Thursday, February 21st, Stamps.com has ended its longtime relationship with USPS. This is completely nuts, since USPS is Stamps.com’s biggest customer by a long shot. Well, I guess they were. This is the juiciest gossip to hit the shipping world since…well, a really long time!

Why Did Stamps.com and USPS Split?

In a conference call this afternoon, Stamps.com’s CEO Kenneth McBride said, “We’ve decided to discontinue our shipping partnership with the USPS so that we can fully embrace partnerships with other carriers who we think will be well-positioned to win in the shipping business in the next five years.”

We’re scratching our heads, because the most well-positioned carrier to win in the next five years is USPS! They are the cheapest carrier for most eCommerce businesses, after all, and will only continue growing as eCommerce keeps exploding. That logic is like betting against the Golden State Warriors when they’re up by 50 points in the 4th quarter. Our opinion? Stamps.com is turning its back on the cheapest shipping carrier for most eCommerce shipments out of greed.

Stamps.com Stock Has Taken a Nosedive

Since Stamps.com broke the news of the USPS breakup, investors have not reacted positively to the news. Shareholders of the 90’s-era Internet company are selling off positions rapidly in after-hours trading, jumping ship like they’re on the Titanic two hours after it hit the iceberg…and the damage is bad. Stamps.com stock (NASDAQ:STMP) is down almost 50% since the news broke earlier in the day. That’s nearly half the company’s market value gone in a matter of hours! Yeesh.

What this Breakup Means for Stamps.com

We’re calling this a breakup, because that’s exactly what it is. This is one of the biggest breakups since Katie and Tom, Jennifer and Ben, and Ross and Rachel. Oh wait, sorry. The Stamps.com and USPS breakup is actually BIGGER. None of those other breakups resulted in billions of dollars of market value erased in a single day.

That being said, it’s hard to say what a future without USPS will look like for Stamps.com. McBride added on the call that there will be “some short-term pain, but we believe it is overwhelmingly in our best interests.”

Kenny, for the sake of your company and its shareholders, we hope you’re right.

Their New “Corporate Strategy” Without USPS

Here on out, Stamps.com will focus on relationships with the two other major carriers UPS (NYSE:UPS) and FedEx (NYSE:FDX). They will also work to expanding their presence in international markets through partnering with DHLAustralia Post, Royal Mail, and more. Obviously, the company will continue to rely on their acquired shipping software subsidiaries like ShipStation, ShippingEasy, and many others to continue capturing eCommerce shippers.

Interestingly, they’re also banking on building a relationship with Amazon as the global eCommerce giant continues building out its own delivery network, Shipping with Amazon.

“Amazon’s track record of disrupting an industry is well established, so their threat should be taken very seriously by every player in the shipping industry,” says McBride. “We are setting our corporate strategy assuming Amazon will be a big global player in shipping.”

Never mind the fact that Amazon injects USPS with hundreds of millions of packages each year and uses USPS for last mile delivery…but I digress.

Stamps.com also plans to focus more on leveraging relationships with regional carriers such as OnTrac and GSO, which emulate Amazon’s same-day delivery in select regions of the United States.

Don’t Freak Out—There are Better Shipping Software Options Out There

If you have been using Stamps.com to buy discounted USPS postage, don’t freak out! There are actually much better free shipping software alternatives out there that are more “with the times” and that will give you way better USPS shipping rates than Stamps.com ever did. Like most older shipping software, Stamps.com adds markups and charges monthly membership fees to make money. Also, they never even offered the deepest level of USPS discounts like Commercial Pricing! Since that is (or was) the case, it never made sense to use Stamps.com to purchase USPS shipping labels anyway.

If you’re looking for a more nimble shipping software solution for your eCommerce business, pop on over to our Reviews page. We guarantee you’ll thank us later.


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