The End of the USPS Postage Reseller Program: Why You Shouldn’t Be Worried
On July 5th, 2022, USPS announced that it is ending its postage reseller program on October 1st…and this has caused some concern in the ecommerce community. However, while many shippers might worry that the end of the USPS postage reseller program will affect the prices they pay to ship their packages, it actually won’t!
What is a Postage Reseller?
To understand why this change likely won’t affect your business, let’s talk about what a reseller is. The USPS Office of Inspector General (OIG) published a report which defines a reseller’s role as the following:
“Resellers are intended to act as outsourced Postal Service sales representatives that recruit small-and-medium-sized shippers.”
In this regard, a postage reseller acts as a kind of “middleman” that brings business to USPS and collects a fee for doing so. The problem is these types of agreements are now outdated, since they were first enacted in the mid-2000s when eCommerce was still in its nascent stages. Back then, there weren’t as many options for shippers and individuals to buy postage online as there are today.
Per the same report from the OIG, other Postal Service partners “provide shipping-related services, such as shipping software, logistics, fulfillment, and online marketplaces.”
Based on that definition, shipping software platforms, 3PLs, and online marketplaces have nothing to do with resellers! In fact, the OIG clearly defines resellers and those other USPS partners as completely different from one another.
You’re Probably Not Buying Postage from a Reseller in the First Place
As stated in the OIG’s report, if you’re buying postage online through shipping software, online marketplaces like eBay or Etsy, or through eCommerce platforms like Shopify, you’re technically not buying postage through a reseller. Those examples are all platforms that offer postage from USPS. USPS classifies platforms differently from resellers, and as a result, they operate under completely different partnerships.
Unlike the myriad shipping software options out there, there are only a few approved postage resellers in the first place. These companies are the ones whom USPS is ending its partnerships with, and we’ve listed them below:
- Express Save Industries, Inc.
- Goa, LLC
- Rapid Enterprises, LLC (Express One)
- SP Parcel, LLC
- Visible Supply Chain Management, LLC
This Change Won’t Affect Shipping Software Solutions and Online Marketplaces
Most small eCommerce businesses these days purchase postage through a select few places: shipping software providers, online marketplaces, Click N’ Ship, or through the new USPS Connect eCommerce program.
As stated before, postage resellers don’t actually provide labels to any of those channels. Instead, USPS partners with those channels directly to offer discounted postage through bulk deals. Through these partnerships, there are no middlemen collecting fees…and in the best cases, this allows for the highest levels of savings to be passed on to the shippers themselves.
Ending the reseller program will theoretically save USPS a lot of money without impacting the bulk of shippers. It’s a big step in the right direction for USPS under Postmaster General DeJoy’s leadership, but in reality, no one will likely notice the change except the resellers themselves.
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Most eCommerce shippers DO purchase postage through a reseller, they just don’t know it. Virtually every shipping platform, marketplace, and ALL of the PC Postage providers get their rates from a reseller. That being said, small-to-medium eCommerce shippers will not immediately be affected by this change. They will, however, be effected by the program USPS is implementing to replace this model. The good news here is that many shippers could see lower rates as this change takes place.