Businesses upset with stamp price hike
Business: Canada Post significantly raising postage costs
By: Don Patterson
| Posted: Wednesday, Dec 18, 2013 06:00 am
A more than 30 per cent hike in the price of stamps has business owners crying foul.
Canada Post announced last week the cost of postage will rise from 63 cents to 85 cents for a book of stamps and $1 each if bought individually. It’s part of a longer list of changes announced by the Crown corporation, including ending door-to-door mail delivery, that’s intended to put Canada Post back on a stable financial footing.
The price increase has left local business owners facing a significant increase in their expenses.
“We mail out 600 pieces a month, so it won’t take long to add up,” said Dean Leask, owner of Contain-A-Way Services in Aldersyde. “When I hear that kind of an increase it’s just not fair. It’s just another tax on small businesses.”
He said he won’t increase costs or add a surcharge, but he will look at ways to reduce his postage costs.
“That’s the first thing I said this morning is I’ll need to look at e-mail billing,” said Leask.
Bev Carlson, owner of Ardiel Agencies in Okotoks, said it’s a big increase in one year and the higher costs will likely end up being passed on to consumers.
“It seems a little bit ridiculous that it’s going up 30 per cent, that’s a little steep,” she said.
Carlson said the increase may drive more businesses to use electronic methods to get their bills and mail out to customers.
“I think businesses will look at alternative ways of doing that, more and more of them are going to electronic formats anyway,” she said. “This would be just reason to switch.”
Canada Post spokesperson Anick Losier said it was a difficult decision to raise the price of stamps and Canada Post knew it was not going to be easy for some.
“We needed to align the cost of our stamps to what it actually costs to send it from coast-to-coast,” she said. “If you’re looking at 85 cents, it’s still half a cup of coffee.”
Losier said fewer letters are being sent by mail and Canada Post has seen the volume of letters sent by mail drop by one-quarter.
As a result, she said Canada Post must adapt and be able to pay its own bills without subsidies from the taxpayer.
“We’ve looked at a plan that is in five points and is going to ensure us that we’re going to be sustainable in the long-term,” said Losier.
Canada Post hopes the steps will return the Crown corporation to financial sustainability by 2019. It’s expected the changes will save Canada Post between $700 million and $900 million per year, once they’re fully implemented.
Over the next five years, Canada Post will also phase out door-to-door mail delivery to homes in urban areas. The service will be replaced with community mailboxes.
The move won’t affect Okotoks or other foothills communities where mail is not delivered door-to-door. As well, two-thirds of Canadian households already receive their mail at community mailboxes.
Canada Post is also looking to cut its labour cost by shedding employees. Between 6,000 and 8,000 positions over the next five years will be cut through attrition as people retire or leave the company. Canada Post is also expanding its retail franchise network and streamlining its operations.
Richard Truscott, director of provincial affairs for the Canadian Federation of Independent Business, said the organization will lobby to get the increase changed. He said a transition period would make it easier for businesses to deal with the increase.
“We will be having some conversations with the federal government and Canada Post about phasing this in,” he said.