The Mystery of Canada Post

I'm in the mail order business here in Canada. Since everything I make is shipped from my location on home base to various parts of the globe, it has come to my attention that Canada Post's rates of service are ridiculously high compared to typical American rates.

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First, it is important to note that from what I have been able to find out, both Canada Post and the US postal service do NOT receive government money to fund their operations, despite the fact that they are owned/run by their respective federal governmnents. We all know that governments do a really crappy job of running things and cost the taxpayer insane amounts of money, but in this case, unlike most government operations, the postal services are self-sustaining. In fact they USUALLY (but not always) turn a profit! (where does the profit from a government corporation go BTW?)   However, what puzzles the heck out of me is the incredible gap in costs to ship stuff overseas (where many of my customers and would-be customers are) FROM Canada versus shipping FROM the USA using the postal services. Here in Canada we pay up to nearly ten times the price to ship overseas than Americans do.   Try it yourself. You can prove this from anywhere in the world. Make up a package, say, something that measures about 20" square and weighs 8 pounds. Go to the the Canada Post web site ([url=http://www.canadapost.ca/Personal/Tools/RC/International.aspx]http://www.canadapost.ca/Personal/Tools/RC/International.aspx[/url]) and find a rate to send that package to Australia. Find out the price. Now go to the US postal web site ([url=http://ircalc.usps.gov/]http://ircalc.usps.gov/[/url]) and do the same thing. The difference is shocking! Here are the figures for the above example if you don't want to do the work yourself. These rates were calculated in February 2009. All examples below use the same package and originating location from Postal Code R7B 0H1, central Canada, to be fair.   USPS from post office rate: Ranges from $49.95 for 10-day service to $71.25 for 5-day service sent from anywhere in the USA to Australia.   Canada Post rate for the same package to Australia as well: $487.58 ! And that's for REGULAR mail, not express! Canada post, when I used this package variant, did not offer any other choice on their web site. But that's regular parcel post anyway, so it couldn't get any cheaper.   Let's see, that same package from central Canada to: UK: surface (takes up to two months) $150 UK: 6 day air: $302.65 Same price for delivering that package to France, Germany, Switzerland and even the socialist utopia of Sweden! Japan is slightly higher at $162.63 and $310.41. Same with Singapore. New Zealand costs "only" $166.25 for surface and $316.95 for 9-day service. Hmmmm... that's over $170 less than Australia which is practically right next door to New Zealand... Does Canada Post have a bias against Australians for some reason??? What about all those modelmakers in Iraq? Let's see... Surface $177.87 and air is $467.65. Well, even though it's a war zone, it's still cheaper than shipping to Australia! How much to send that 20"x20"x20" 8 pound package to locations in the USA from here in Canada? Let's try Texas, a state that is about as far away from Canada as you can get..... Hmm.. two week service is $78.68. One week is $115.23. Same package, mailed from Central Canada. What about North Dakota, which is bordered only about sixty miles or so south of the Canadian postal code I used for the "from" destination... my previous Central Canadian home town of Brandon, MB... $51.32 for two week service. It's $84.65 for one week service. Waitasec.... What was that again? Canada post charges more to send a package less than 100 miles south than the USA postal service does (approx. same time frame, 5 day service) to send the same package from the USA to AUSTRALIA, halfway around the world!!!!!! Read that again and let it sink in! Is that not outrageous? Okay, now let's have some more fun. how much does it cost to send that package from WITHIN Canada, let's say from where I used to live (Brandon, MB) to where I do now (Nova Scotia)... That's just about halfway across the country for those of you who didn't study any Canadian geography. 8 business day  service: $41.16 3 day service: $147.15. Okay. What about across the street? (Literally! I'm using the same postal code for both the "to" and "from" locations!) Well, looks like they can do it in 1 business day, but it'll cost $30.37! If you choose two days (the maximum time allowed... I guesss they even have some limits! ) they'll discount it to $25.50! That's to take it across the street! (yeah, I know, who'd actually be dumb enough to DO that but I'm trying to make a point here! Okay, now let's see what happens when we ship WITHIN the USA... If I lived in Los Angeles and wanted to mail it to Massachussetts (that's completely across the country from west to east for the geograpically challenged people out there!), the cost would be: 8 bus day service: $27.74. That's across the country in the USA at only a couple dollars more than it costs to mail the same package across the street in Canada! One day service, $51.65. That's two days less than the similar Canadian example and about 1/3rd the cost!   Yes, I know that the differences between the US and Canadian dollar isn't taken into account in these examples, but right now that accounts for only a 20% discrepancy. Not the kind of rate difference we see in the examples above and any other examples you want to try. Look, I could sit here and play this all day but I think by now you get the point! Canucks in the Mail Order business are getting seriously hosed by our own country's government run postal system! We just can't afford to ship stuff overseas in many cases! Most people who want to buy some of my products can't afford the insane rates Canada Post charges! By the way, in the USA, the postal service continues to deliver even on Saturdays. Canada post delivers only Monday through Friday.   So, will someone (without a bias) please tell me why Canada Post charges so much compared to the US postal system? Hmmm?   Here are some answers I will likely get but I can discount them too. So don't bother using them:   Some will say, "Well, the USA has ten times the population so there's more of a market to absorb the costs".   That's not a valid point. You'd also have to have ten times the infrastructure to serve that larger population. Also, it doesn't explain the massive differences when shipping from Canada to OUTSIDE Canada, like to the UK or Australia!   "Well, Canada is a bigger country!"   I can blow that one out of the water too. Canada's not THAT much bigger. Besides, the example above shows that to mail something HALFWAY across Canada is more expensive than mailing it ALL THE WAY across the USA. So that one is moot. Again, it doesn't explain the massive differences when shipping from Canada to overseas!   "Well, Canada doesn't have the population density!"   About 90% of Canada's population live within a strip only about 100 miles wide along the US border. Population density in Canada and the USA is therefore roughly the same overall. Most of Canada to the north is uninhabited wilderness and worthless tundra. The USA's population is spread relatively evenly across the entire country, east to west, north to south as most of the land mass there is more habitable. That also means the US postal service has to cover a much greater land mass, relatively speaking. There's that larger infrastructure thing once more.   Now, I have no problems with anyone making a large profit. Business needs to make a profit to stay in business. However.... Canada post finished 2005 with 200 million dollars in profits. In 2007, according to their own union's web site, Canada post also: • Made $54 million in net (after tax) profit from the post office and its companies. For the first time Purolator provided more than 50 per cent of Canada Post’s profits. • Made $160 million in income before taxes. • Paid $102 million in taxes. • Paid $47 million in dividends. They still continue to raise the rates. (BTW, Note that tax amount! They paid twice the amount in taxes than they made in profits!)   So, I ask again: Why does Canada Post charge three to ten times the rate for postal service than the US postal service?   I won't hold my breath for the answer. E. James Small currently lives near Truro, Nova Scotia. James was born in Montreal in 1965. James’ parents were both independent commercial artists, but they were English and were therefore boycotted by French businesses in the 1970’s so they opted to retire and move to Apple River, Nova Scotia in 1980 (there’s a whole story to that one!). Since then I have also lived in several towns in NS, such as Springhill, Amherst and also lived in Oshawa, Ontario and Brandon, Manitoba, but Nova Scotia, unfortunately, keeps dragging me back. I currently earn a living as a modelmaker, my primary passion, building models for everyone from individuals to businesses. James can be reached at: jim@smallartworks.ca

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