delivering your products in the usa -...
TRANSCRIPT
U.S. Postal Service Global Business
Did You Know?..........
• Quasi-government
• No funding from the Government
• Profit oriented
• USPS delivers more last mile eCommerce residential deliveries than any other
delivery company in the US
• COOPETITION is good for the market
• Facilitators of competitive shipping options for domestic and offshore b to c
shippers through IT enabled solutions
• Work share means savings
• Higher zones vs. lower zones
• USPS handles 46% of the world’s mail
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U.S. Postal Service Global Business
Why The USPS is used for Package Delivery
Examples of key reasons
• USPS has the largest shipping delivery network in the U.S.
Provides final U.S. delivery for many other carriers
Over 4.8 billion packages delivered in 2016 by USPS
Largest retail acceptance footprint in the U.S.
Trusted brand and security
Access to household mailboxes and front door
Upfront pricing with no hidden surcharges
Competitive tracking and delivery performance
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U.S. Postal Service Global Business
The U.S. Demand For Goods Abroad
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Summary of findings
Source: The Colography Group, Inc. Air and Ground by Weight ©2016 CGI all rights reserved.
Continued improvement hangs precariously on consumer willingness and ability to spend more.
U.S. online purchases from foreign websites continue to increase at a faster rate than all other imports.
48% of U.S. inbound volume weighs 2-20lbs.
51% of items into the U.S. are routed using multiple carriers to keep the costs low and transit commitments favorable.
Unless economic indicators change course significantly during 2017, near-term U.S. demand will continue.
U.S. Postal Service Global Business
Products U.S. Consumers Buy From Cross-border Websites
5Source: Google and TNS, “Consumer Barometer,” June 2015.
Note: n = 1,383 who ever purchased a product/service from a foreign ecommerce site.
Product Categories Percent Of Respondents
Clothing and accessories 31%
Books CDs, DVDs, video games 22%
Computer hardware, software or peripherals 16%
Toys 15%
Cosmetics, beauty or health products 14%
Home furnishings and household goods 11%
Food (items, specialty) 9%
Gifts, etc. 9%
Digital cameras/camcorders, audio devices 8%
Mobile phones, SIM cars 8%
Car parts/accessories 7%
Tools and garden equipment 7%
Drinks (alcoholic and nonalcoholic) 6%
Domestic appliances 6%
Sports equipment 6%
Cars 4%
Other 13%
U.S. Postal Service Global Business
49%
43%
35%
20%
11%
10%
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The price is better internationally
The brands or products I like are not available in the US
Want something unique not found in US stores
The quality is better
Like the status with shopping internationally
Want products found while traveling or living abroad
Source: Google and TNS, “Consumer Barometer,” June 2015.
Note: n = 3,217 who ever purchased a product/service from a foreign ecommerce site.
Reasons U.S. Consumers Buy From Cross-border Websites
U.S. Postal Service Global Business
Importance of Options When Checking Out Online
Free shipping options
Percent of Respondents for Whom Online Checkout Options Are Important
Source: Secondary empirical research
Note: Respondents may choose more than one option. N=5,849
35%
43%
31%
51%
37%
51%
63%
62%
50%
54%
81%
0% 10% 20% 30% 40% 50% 60% 70% 80% 90%
Having a variety of payment options in addition to a
credit card
Order history, so I can see everything I’ve bought
Estimated or guaranteed delivery date
Provide estimated delivery date and shipping costs
early in the process
A login so the site can remember my purchasing
preferences (e.g., credit card number)
Ability to select delivery location that is convenient to me
Remember me so I don’t have to refill my shopping cart or
rekey information if I already started an order
Show me other items I might be interested in
Flat rate shipping options
Expedited shipping options so I can get my purchase
faster
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U.S. Postal Service Global Business
Reasons for Abandoning Online Shopping Cart
25%
24%
50%
58%
57%
0% 10% 20% 30% 40% 50% 60% 70%
I was not ready to purchase, but wanted to
get an idea of total cost with delivery
Shipping costs made the total purchase
cost more than expected
My order value wasn’t large enough to
qualify for free shipping
I wanted to complete the purchase, but got
distracted and forgot
My preferred payment option was not
offered
Percent of Respondents That Agreed With Reason for Abandoning Shopping Carts
N = 5,241
Source: Secondary empirical research
Note: Respondents may choose more than one option. N=5,8498
U.S. Postal Service Global Business
Consumer Willingness to Wait for Shipping
Percent of Respondents by Number of Days Willing to Wait
3%
6% 6%
25%
32%
18%
10%
0%
5%
10%
15%
20%
25%
30%
35%
2 days 3 days 4 days 5 days 6-7 days 8-10 days 11+ days
Source: Secondary empirical research N=5,8529
U.S. Postal Service Global Business
U.S. Consumer Preference in Delivery Location
Percent of Respondents by Preferred Delivery Location
Source: Secondary empirical research N=5,852
74%
5% 5% 4%3% 2% 7%
0%
10%
20%
30%
40%
50%
60%
70%
80%
My Home/Residence
My Workplace Friend or Family Member
Another Authorized Pickup Location
Another Retail Location
Delivery Locker Retailer's Store
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U.S. Postal Service Global Business
Who is the Preferred Package Delivery Carrier in the U.S.
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7.1%
6.4%
4.0%
8.6%
7.7%
8.6%
6.2%
7.2%
11.6%
14.8%
13.1%
15.2%
16.3%
13.2%
14.5%14.0%
0.0%
2.0%
4.0%
6.0%
8.0%
10.0%
12.0%
14.0%
16.0%
18.0%
1st Quarter 2nd Quarter 3rd Quarter 4th Quarter 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter
FY-2015 FY-2016
Total
Market
U.S. Package Delivery Carrier Trends (Volume Growth)
Source: The Colography Group’, Inc. ©2016 CGI all rights reserved.
U.S. Postal Service Global Business
Shipping services offered in the marketplace
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Higher
ServiceFasterSlower
Lower
Price
U.S. Postal Service Global Business
Two Methods to Send Multiple Packages to the U.S.
One-to-One Shipments One-to-Many Shipments
xx
Steady (5-8 days)Faster (1-4 days)
EconomicalExpensive
Transit
Price
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U.S. Postal Service Global Business
Cost of Single-Piece Pricing
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Worldwide
Expedited
Origin: Mumbai, India (400076) Destination: Denver, CO (80216)
$124.00
$126.19
3lb. Package
Actual Rate
MumbaiGATEWAY TO INDIA
International
Economy
Source: The Colography Group, Inc. ©2017 CGI all rights reserved.
Note: The above rates are 2017 commercial published rates for import shipments from India.
The applicable international fuel surcharges for FedEx and UPS are 2.5% and 4.25%, respectively.
$117.21
$117.22
$4.98
$2.93
$4.00
$3.85
Base Rate Fuel Residential
U.S. Postal Service Global Business
Commonly Overlooked Costs incurred for U.S. Deliveries
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Example of commercial carrier surcharges for U.S. ground package deliveries
Additional handling $ 10.85 $11.00
Address correction $ 13.40 $14.00
Missing or invalid account number $ 13.40 $14.00
Large / oversize package $ 70.00 $72.50
Delivery intercept / reroute (air) $ 13.40 $14.00
Residential delivery (air) $ 4.00 $4.00
Residential delivery (ground) $ 3.40 $3.45
DAS commercial (air) $ 2.45 $2.60
DAS commercial (ground) $ 2.30 $2.45
DAS residential (air) $ 3.80 $3.90
Extended DAS commercial (air) $ 2.55 $2.60
Extended DAS commercial (ground) $ 2.40 $2.45
Source: The Colography Group, Inc. ©2017 CGI all rights reserved.
Note: Not an exclusive list of all surcharges.
Carrier Surcharge
U.S. Postal Service Global Business
Global Direct Entry (GDE)
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• An innovative means to drive efficiencies and cost savings within an importers’
supply chain, benefitting both you and your customers located throughout the
country
GDE components:
Offshore sourcing
Logistics
Customs brokerage
USPS final mile delivery
Who Benefits:
Your customers
Your bottom line
Your ability to compete-speed to market
Solution that Reduces Costs and Has Competitive Transit
U.S. Postal Service Global Business
How Does Global Direct Entry Work?
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GDE Life Cycle
• Pick up parcels from offshore customers
• Print labels and postage using USPS Global Shipping Software or PC
Postage equivalent
• Consolidate parcels-by air or sea
• Arrive at destination and clear customs (no duty for parcels valued at $800
or less going to 1 addressee on a single day)
• Hand over parcels to the USPS for final delivery
U.S. Postal Service Global Business
Global Direct Entry: Features
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Door to door service in 4-8 days
Integrated shipping platform for package preparation
Customs clearance
End-to-end visibility
Courier level expedited shipping service
Competitive pricing well below courier rates
Provider as single point of contact for customer service
Shipment have look and feel of a domestic shipment
U.S. Postal Service Global Business
Last Mile Solutions-What works for your customer?
• First Class Mail/First Class Parcel
• One zone for the USA-inject from any US gateway (i.e. JFK)
• Light weight products up to 15.99 ounces w/limited tracking
• 3 to 4 days service within the USA-great for low value products
• Priority Mail
• Delivery confirmation available-higher value shipments
• Up to 70 lbs. anywhere in USA
• Zone Based with a 2 to 3 days within the USA
• Parcel Select/Parcel Select Lightweight
– 3 to 6 days transit time within the USA
– Ideal for low value items
– Limited tracking
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EVERY DOOR DIRECT MAIL®
United States Postal Service – January 2017
of households say
they read or scan
their mail daily.81%
76%of consumers have
been influenced to
purchase by Direct Mail.
75%of 25- to 34-year-olds
have made a purchase
as a result of Direct Mail.
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EVERY DOOR DIRECT MAIL®
United States Postal Service – January 2017 22
What is Every Door Direct Mail?
An efficient and affordable service for businesses that want to
target specific areas in their local market without requiring
names and addresses on the mailpieces.
Low Tech Mail Process
+
Easy-to-Use High Tech Solution
EVERY DOOR DIRECT MAIL®
United States Postal Service – January 2017 24
Find your local customers by using the online mapping tool.
► By City
► By ZIP Code
► By Location
► By Intersection
Online Mapping Tool
Access the Online Mapping Tool @ https://eddm.usps.com
EVERY DOOR DIRECT MAIL®
United States Postal Service – January 2017 25
Enter Your Location
Enter or modify
search criteria
here.
Search by:
City/state combination
ZIP Code
Combination of street, city, state,
and ZIP Code
U.S. Postal Service Global Business
Where to Target Consumers
MT
WYID
WA
OR
NVUT
CA
AZ
ND
SD
NE
CO
NM
TX
OK
KS
AR
LA
MO
IA
MNWI
IL IN
KY
TN
MS AL GA
FL
SC
NC
VAWV
OH
MINY
PA
MDDE
NJ
CTRI
MA
ME
VTNH
West Region• California, is the most
populous state in the U.S.
• Large concentrations of
retirees and high income
households – both with
discretionary revenue
• Consumers are commonly
characterized as early
adopters of online shopping
habits of new technology,
fashion apparel/accessories,
cosmetics, etc.
Midwest Region• Make up the largest concentration of warehouse
fulfillment facilities for shipments to consumers
• Heartland for consumers working in the
manufacturing, agriculture and industrial jobs
Northeast Region• New York is the most
populous city in the U.S.
• Large gateway for U.S.
inbound Consumer
merchandise
• Very high household
income and discretionary
revenue
• Known for multi-cultural
consumers that have
online buying habits
South Region• Houston is the 4th largest city in the U.S. and Texas GDP ranks alongside of countries like
Canada and India
• Large concentrations of students and up-in-coming professionals with families with buying
habits on sports, technology, fashion apparel /accessories, toys, etc.
U.S. Regional Consumer Insight
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U.S. Postal Service Global Business
Higher Concentrations of U.S. Online Consumer Deliveries
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Large populous locations also have high concentrations of package deliveries
AK
MT
WY
ID
WA
OR
NV
UTCA
AZ
ND
SD
NE
CO
NM
TX
OK
KS
AR
LA
MO
IA
MN
WI
IL IN
KY
TN
MS AL GA
FL
SC
NC
VAWV
OH
MINY
PA
MDDE
NJ
CT RI
MA
ME
VTNH
HI
> 120M
< 10M
Annual Volume
U.S. Postal Service Global Business
In Conclusion
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• Using a multi carrier partnership approach will give you the best bang
for the buck
• Inject your parcels into the USA using a multi gateway approach using
appropriate zip code distribution to drive profitability and reduction of
customer complaints
• Expand beyond the Indian diaspora using EDDM and other direct mail
methods to supplement social media efforts
• Utilize Global Direct Entry vs. traditional methods of distribution to
improve the customer experience and reduce costs
• Product value, customer expectations, brand image and volume of
shipments drive last mile delivery choices-question your provider
• Effective March 10- $800 deminimus
• Trans shipment opportunities to S. America and Canada