Updates on COVID-19 and the Impact on International Shipping

Shippo Snippets:

• Major carriers are managing to continue service around the globe, albeit with some delays and disruptions
• The Universal Postal Union (UPU) is steadily working to increase options for postal industries around the globe
• Challenges faced by carriers include varying lockdown policies, mini-freighter issues, port congestion, and legal considerations
• Transparent and understanding communications with your customers can help to build customer loyalty during COVID-19 challenges

The Story:

According to the USPS on April 19, 2020: “The Postal Service has so far experienced only minor operational impacts in the United States as a result of the COVID-19 pandemic.” And that’s held true with most carriers within the U.S., as shipping has carried on without any major hiccups, sans some not-so-unexpected delays. 

International shipping is obviously, a much more complex area. We recently provided an update on the latest carrier news that included recent details about surcharges for international shipments. Here, you’ll find more recent updates on the impact of COVID-19 on international shipments by the USPS and other carriers, and details on how the Universal Postal Union (UPU) is responding. 

United States Postal Service Updates

The USPS has been significantly limiting services outside of the U.S. as countries navigate the difficulties of COVID-19.

You can see a list of more than 70 countries (as of April 20, 2020) where service has been temporarily suspended. These countries are listed in alphabetical order with the date of when these suspensions were put into effect next to each country’s name. Note: asterisks listed after a country’s name mean that they are not accepting incoming mail at this time. Items addressed to countries on this list will be returned to the sender. 

Effective on April 14, 2020, there are also temporary suspensions for Global Express Guaranteed deliveries in more than 30 countries. If items are returned because of service suspension and it has a customs form, the USPS will, upon request, refund postage and fees. If a returned item is not delivered because of service suspension and it does NOT have a customs form, the USPS will still refund postage and fees upon request OR you can choose to resend once services have been restored. If you pick the latter option, you will need to cross out the following before re-sending: “Mail Service Suspended—Return to Sender.” You can find more information about getting refunds on international shipments here. 

Note: Service suspensions to a country will not apply to military or diplomatic mail unless specifically noted on International Service Alerts. You can find zip codes where diplomatic mail is currently being suspended, with a targeted end date of May 8, 2020.

Plus, the USPS has temporarily suspended Priority Mail Express International service guarantees for the following countries: France, Great Britain, Spain, Sweden, and Switzerland, as well as China and Hong Kong.

Universal Postal Union Strategies

The Universal Postal Union (UPU), located in Switzerland, plays a key role in advising postal sector members from 192 countries and establishes rules for international mail exchange. On March 30, 2020, it updated its statement on COVID-19-related disruptions in service, worldwide. They are focusing on identifying ways to mitigate the virus’s impact on the postal supply chain, noting the challenges of “widespread restrictions and cancellations of passenger flights.”

Specifics include how they are:

• Exploring ways to help members that are looking to deliver shipments by air; encouraging members to explore opportunities on both cargo flights and passenger flights
• Asking members who are already successfully using cargo flights or passenger flights to share this information with them; the UPU will, in turn, make this information available for other members
• Working with the International Air Transport Association (IATA) to help ensure space on air cargo carriers 

The UPU is consolidating the information they’re gathering about air freight, as well as about transport by rail and sea. Members will be able to access this regularly updated information using the same credentials they have to access EmIS messages sent by the UPU. All of this will provide postal industries around the globe with valuable information, such as info about rail transport routes available between Asia and Europe, both ways; cargo flight information about mail between Europe and China; and sea options for the United States, as well as Australia and Canada. 

Major Parcel Carrier Challenges

In regards to UPS, FedEx, and DHL, what’s happened to trigger the need for surcharges?

First, here’s the short answer. They’re juggling a wide variety of lockdowns, port congestions, mini-freighter air cargo challenges, legal considerations, and more. These take time to address, even when doing so as nimbly as possible. 

Recently, we touched on the use of mini freighters, which involves airlines using passenger planes, with rows of unsold seats, to deliver cargo (and is a strategy being touted by the UPU). This is a smart reallocation of resources, but one that comes with significant physical and economic challenges. This is true, in large part, because air freight is directional. In other words, sometimes more freight goes out than in, or the other way around—which means that airlines are using half of their planes to deliver mostly in one direction, which is clearly more costly than having sold out seats in both directions.

Here’s more.

Sampling of International Lockdowns

Using Southeast Asian countries as an example, you can easily see the diversity and fluidity of situations that carriers are dealing with. Malaysia underwent a national lockdown from March 18-March 31, that has since been extended. In Indonesia, the lockdown is already in place until May 29. Then there’s Singapore, a country that has placed trade control at its borders. This means, among other things, that people at all sea checkpoints must have their temperatures taken.

Major carriers must be aware of processes and procedures at each destination, as they provide essential services, with restrictions evolving as the COVID-19 situation does.

Port Congestion

In countries with lockdowns, cargo isn’t always being picked up after being delivered. This can be because designees are sheltering in place or because the receiving business doesn’t have warehouse space—or the warehouses themselves are closed.

Ports often have fewer workers to facilitate cargo delivery and to break through the congestion. And, as more unclaimed packages stay at ports and in interim warehouses, there is less space for incoming packages, something else the skeleton crews at the ports need to address. 

Legal Considerations

When cargo is delivered by ship, a “safe port” must be designated. If that port is closed, then the cargo needs to be taken to another port as a Plan B. When cargo is considered non-essential, though, it can’t be transported from port to port if the country is under national lockdown.

Then, when cargo needs loaded onto the vessel, health authorities must approve it, a process called “free pratique.” This includes reviewing the ship’s crew, which can take time.

What This Means for Your Business

As mentioned, when shipping within the United States, all has largely been proceeding as normal. If you ship internationally, though, it can help to provide information about potential shipping delays with your customers as part of your business’s COVID-19 policy that you share with them. You can let them know that, despite significant efforts to keep supply chains moving, there can be delays.

When creating or modifying this policy, whether for domestic or international customers, here are some aspects to keep in mind when communicating:

• How you value your customers and their health and safety
• Steps you’re taking during packaging and shipping to help keep everyone safe
• Information about delays that your business may experience from your suppliers—and how this can affect product shipments to your customers

COVID-19 is global, with specific challenges often changing by day, varying by country. So, this is a time to be especially transparent with customers, giving them your honest assessment of when a shipment might arrive. 

This can also be a good time to review your return policies and use it to fuel future growth of your business. Delays because of COVID-19 aren’t your fault, but it does present an opportunity to build customer loyalty by how you respond to people who request a return or refund.

It will also help to stay up to date on COVID-19 shipping news, in general, and the specifics about countries where your suppliers and/or customers are located. And, as always, choose the carrier that offers the best value for your shipments. As surcharges fluctuate during COVID-19, it can make sense to price-compare more frequently. 

Use this time to create additional value for your customers to further build loyalty. Do you have content that’s for subscribers only? Can you make more of that available to all of your customers while still providing premium service to your subscribers? Perhaps, provide discount coupons for future purchases? (If so, avoid coupon codes like COVID-19.) Can you create a webinar where you can stay in touch with customers and answer their questions? 

No matter which methods you choose, keeping your customers informed and providing service with a high level or understanding will go a long way. 

Check back regularly for Shippo’s COVID-19 carrier updates about domestic and international shipping rates.