http://fortune.com/2017/07/16/amazon-postal-service-subsidy/The U.S. Postal Service and Amazon have a special relationship. In 2013, for instance, the USPS agreed to offer Sunday delivery of Amazon packages.
But shipping industry watcher and money manager Josh Sandbulte thinks there’s an ugly underside to the USPS-Amazon collaboration. Sandbulte, writing in the Wall Street Journal last week, argued that the
USPS effectively subsidizes the price of shipping Amazon’s packages.
According the Sandbulte, Congress has barred USPS from setting its parcel prices below its costs, to keep it from unfairly undercutting competitors like FedEx and UPS. But the formula for calculating those costs, set in 2006, hasn’t kept pace as packages have come to make up a higher and higher percentage of USPS volume. The law set the share of infrastructure costs associated with packages at 5.5%, but boxes now make up around 25% of Postal Service revenue.
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