Survival of Chit Chats and Stallion Express with Tariffs

[sapphyres-designer-jewellery]

This hasn't been discussed much, but people have mentioned it...

What are the odds of Chit Chats and Stallion Express surviving all these changes with the tariffs?

Stallion has told me that everything will go DDP or DDU, I presume DDU is Canada Post through Stallion (when eBay rates are actually better, I let me contact at Stallion know about eBay's rates but she said they couldn't negotiate anything better with Canada Post, and then Stallion let her go, so I have no direct contact there anymore).

With DDP, not sure how many people will use that. I guess if you have a website and can add tariffs, you can do DDP, those of us with eBay selling cannot do DDP unless we pay the tariffs (and with Canada being 35%, that's my profit, I'm not giving it to the United States government).

I'm very anxious about the ability of the CBS to survive all this and I'm fully expecting Stallion in my city will close it's branch (and then my closest will be Mississauga). I'm thinking the volume will go way down and it's not productive to keep all the branches open with all the staff they have. I've been informed they have already let a lot of people go due to the China tariff situation, but so far as I know, no branches have closed yet. My branch says volume is way down.

C.

[byto253]

I wonder as well.  I can see Chitchats retreating from Ottawa to the bigger cities.  

I would like to see them put forward an international shipping push with simplified quotes and perhaps flat rates for certain slot sizes, if that is practical at all.  Like other sellers I will be exploring markets outside of North America in the future and navigating the shipping and packaging requirements are the main hurdles.   

Usually whenever I look at anything of much size the shipping does not make it feasible. 

[recped]

Stallion has a lot of different operations going on, the cross border stuff is only part of it.

At the drop off location I use there used to be 3 of those large pallet boxes, one for Canada/Overseas and two for US. If I how up just before cut off times (3:00pm) the Can/Int box is usually half full, the two US boxes are overflowing.

These days the Canadian/Internation box is still pretty much always full but the US Boxes are gone and the number of US bound packages has shrunk dramatically.

Of course this is only really an indicator of what's happening with relatively small time sellers that use the drop off. Stallions major customers are not using drop off locations, they are either delivering to HQ or more often having Stallion doing pickups.

If DDP becomes the norm that opens up a whole new option for Stallion. If the de minimis exemption goes away there will be tons of companies going the DDP route, if Stallion can do this at low cost there is a ton of business out there for them.

I can't comment on ChitChats, I haven't used them since 2018.

[dinomitesales]

I don't see them surviving if the de minimis removal goes through. Or, at least, not in the same capacity they currently are. Their entire business was built upon the de minimis loophole of goods into the States. Yes, they have diversified to include international services, but I think it's too little too late. And don't most of their International services transit through the US anyway (i.e. they sprung up because the goods could be brought into the USA under de minimis and then forwarded internationally from the USA cheaper than they could be from Canada)?

What exactly are the benefits to using them if not for low-value imports into the USA that were previously free to transit into the country? There is no benefit to use them for any Canada Post DDU option. And it's currently unknown how lucrative a DDP option would be - I feel like no one wants to prepay tariffs for American buyers (and are there even any major Canadian e-commerce platforms that can charge the buyer for said fees?). Even taking the tariff out of the equation entirely, the cost of using their services are only going to increase because now they have exponentially more paperwork and bureaucracy to get these items over the border and into the hands of USPS.

[dache_us]

Stallion seems to be diversifying with their 3PL service.

I don't get why they don't have an unbox and ship servoce, that is as fluid.  Couldn't you just ship to Stallion's buffalo 3PL, declare the ad valorem on the wholesale price, then pay Stallion an additional fee to reship to the final destination? 

[ilikehockeyjerseys]

DDP would only be useful for larger firms that have items in high demand and have their own website to sell on. With their own website or platform, they have more control over how they market the shipping to US buyers. It would be easier to communicate the idea that their item comes without additional charges at the door. 

Most that fit that description would already have a presence in the US. 

The main problem with DDP for smaller sellers on places like eBay is that even if a person somehow sells an item where the additional charges don't make it overpriced, there is no effective way to market it as DDP on eBay.

While we are all individual sellers, the experience a buyer has with one eBay seller tends to affect all sellers. So once tariffs are collected on Canada Post, and US buyers understand buying from a Canadian=possible charge at the door, they will effectively ignore all Canadian eBay sellers, unless that seller has an incredibly unique underpriced item. 

[recped]

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@ilikehockeyjerseys wrote:

DDP would only be useful for larger firms that have items in high demand and have their own website to sell on. With their own website or platform, they have more control over how they market the shipping to US buyers. It would be easier to communicate the idea that their item comes without additional charges at the door. 

Most that fit that description would already have a presence in the US. 

The main problem with DDP for smaller sellers on places like eBay is that even if a person somehow sells an item where the additional charges don't make it overpriced, there is no effective way to market it as DDP on eBay.

While we are all individual sellers, the experience a buyer has with one eBay seller tends to affect all sellers. So once tariffs are collected on Canada Post, and US buyers understand buying from a Canadian=possible charge at the door, they will effectively ignore all Canadian eBay sellers, unless that seller has an incredibly unique underpriced item. 

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I know of a number of smallish and not so small businesses which have been using DDP methods for years to ship from Canada to the US. A number of US companies I purchase from (retail orders) are using DDP and always have to service Canadian orders. When I was exporting to retailers & distributors in the US in the 80's and 90's they were almost all shipped DDP.

While this might be too complicated for a casual seller anyone operating a long term business even if it's modest volume can do it.

Here is a workable scenario for some:

Figure out the payable duties + brokerage costs and add that amount to the shipping charges applicable to US buyers, ship all US orders DDP and highlight the fact that buyers would not need to pay any duty or custom clearance fees at delivery. If you include these amounts in shipping there are no addition eBay fees since the fee calculation is based on domestic shipping not what an International buyer is charged.

[rdemaree]

I was told by someone at a chitchats branch today that CUSMA compliant items are still going to be tariffed at 25-25% rate when de minimis ends.

I feel like this isnt correct information.

Can anyone let me know if this is true or not? I feel like this guy doesnt understand CUSMA etc. 

All input would be helpful.

I just want to get my business ready.

I am going to be seeking Canadian brick and mortar stores to carry my product in anticipation of loss in ecommerce sales tho. 

[recped]

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@rdemaree wrote:

I was told by someone at a chitchats branch today that CUSMA compliant items are still going to be tariffed at 25-25% rate when de minimis ends.

I feel like this isnt correct information.

Can anyone let me know if this is true or not? I feel like this guy doesnt understand CUSMA etc. 

All input would be helpful.

I just want to get my business ready.

I am going to be seeking Canadian brick and mortar stores to carry my product in anticipation of loss in ecommerce sales tho. 

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I concur, the ChitChats person who told you that is not correct.

[sapphyres-designer-jewellery]

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@rdemaree wrote:

I was told by someone at a chitchats branch today that CUSMA compliant items are still going to be tariffed at 25-25% rate when de minimis ends.

I feel like this isnt correct information.

Can anyone let me know if this is true or not? I feel like this guy doesnt understand CUSMA etc. 

All input would be helpful.

I just want to get my business ready.

I am going to be seeking Canadian brick and mortar stores to carry my product in anticipation of loss in ecommerce sales tho. 

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Don't go by what Chit Chats says, they often don't know what they're talking about.

When the DDP thing for China came in (and it was looking like it would be all countries) Chit Chats told me if the country doesn't exist anymore I can say it was made in Canada. They also told me I can use the brick and mortar store as the manufacturer of my products if they are vintage or antique. They are wrong.

C.

[ilikehockeyjerseys]

The issue I am referring to isn't that it is too complicated for a smaller seller to figure out DDP. It is that buyers on a platform like eBay may not be able to easily distinguish which items are DDP. If they haver multiple buying experiences that result in tariffs charged at the door, they will learn over time that buying from a Canadian seller on eBay = tariffs, even if that won't be true for all sellers.

For sellers who have their own independent selling website that traffic gets pointed to, or who already have a base of customers on their branded website, they can easily find a way to market to any traffic that there will be no additional fees after checkout. 

I am more referencing the marketing difficulty that eBay sellers who offer DDP might face. Not the process of using DDP shipping, which is already available to most through Chit Chats.