Government Operations Committee on Oct. 31st, 2016

[Andrea Stairs]

Yes, we can send it to the clerk.

You see urban areas pop, but the fact that you have sellers across the country in rural areas that are able to do business is something that I'm personally very proud of. Every year we have our entrepreneur of the year awards, and last year's winner was a woman who runs a shop that sells skating gear and dance gear in a small town called Blezard Valley, which is outside of North Bay, Ontario. She is tapping into an international demand.

[Kelly McCauley, Conservative, Edmonton West, AB]

I going to have to interrupt you because I have a couple of other questions.

You mentioned aggressive tiering of pricing. Could you explain what you mean by that?

[Andrea Stairs]

Yes. It's having pricing based on speed and making real differences between those different services, and also pricing based on volume, so making Canada Post a partner with small and medium-sized businesses. As those small and medium-sized businesses expand and scale, there is a reason for those businesses to stay with Canada Post and volume discounts would occur.

[Kelly McCauley, Conservative, Edmonton West, AB]

You mentioned that 90% of eBay transactions are Canada Post. Is the other 10% just a smattering of the other competitors?

[Andrea Stairs]

Yes.

[Kelly McCauley, Conservative, Edmonton West, AB]

Generally, in the States is it the same, and 90% is with USPS?

[Andrea Stairs]

I don't have the numbers, but I think, ballparkish, it's the same. I would say it's potentially slightly lower, but it's significant.

[Kelly McCauley, Conservative, Edmonton West, AB]

The threshold you were discussing, I know is at $20. It came up recently in the National Post. I think it's $800 the other way.

I understand how it will help Canada Post, but how do you think it would help eBay Canadian suppliers? Would it not be just like a huge influx of competition?

[Andrea Stairs]

No, in fact our sellers find it a huge pain point both because it makes their inputs more expensive relative to their U.S. competition, and also because on returns they're often having to pay duties and taxes on inbound returns from foreign customers.

[Kelly McCauley, Conservative, Edmonton West, AB]

Okay.

Regarding the possible labour disruption you were talking about, I can understand what everyone went through. My wife at the time had a small business and she was getting the constant letters from her bank and everyone else to say, “Make sure you're paying.” How do you think it would be best addressed?

We have to follow collective agreements and the bargaining, so we can't have a no-strike position. How would you have handled it differently besides what Canada Post did, which was to warn their customers that they needed to find someone else just in case?

[Andrea Stairs]

I'm not an expert in collective bargaining. I am only really representing the impact.

Again, I do think the two-year agreement is a real challenge, because the odds of us getting back into the same situation—

[Kelly McCauley, Conservative, Edmonton West, AB]

We will be.

[Andrea Stairs]

Yes. I think that's a real challenge, particularly as we all want Canada Post to maintain its leading share in parcel delivery. If this happens every two years, it's basically an impossibility.

[Kelly McCauley, Conservative, Edmonton West, AB]

Is the U.S. the number one customer for eBay merchants in Canada?

[Andrea Stairs]

Yes. The U.S., the U.K., Germany, China, and Australia would be our top markets.

[Kelly McCauley, Conservative, Edmonton West, AB]

Do you get any feedback on what USPS does that might be of value to copy up here?

[Andrea Stairs]

Yes. If you talk to one of our sellers, they know the USPS postal rates backwards and forwards and how they compare to Canada. They are much more affordable relative to Canadian rates. As I mentioned earlier, tracking on packet services is a key point of differentiation that our sellers find particularly difficult. It hampers our ability to compete with U.S. sellers. I think those would be the key things.

They also have purpose-built products. Media Mail, which I think still exists, is a purpose-built product for a certain segment. They have flat-rate boxes, which sellers in the U.S. really appreciate.

[Kelly McCauley, Conservative, Edmonton West, AB]

Yes, we've heard of that before. Do you think something like that would be of value up here?

[Andrea Stairs]

eBay and Canada Post have been working together for more than 10 years. We've had various partnerships. They're on our platform providing label printing services, and we tried to do a flat-rate box test. It was okay; it wasn't amazing. I think, frankly, investing in the products that they have already and complementing them with some slower products and just making the pricing a bit more aggressive would be the things that our sellers would most appreciate.

[Kelly McCauley, Conservative, Edmonton West, AB]

You would like to see a slow service option and better tracking.

[Andrea Stairs]

It's not so much better tracking. For a long time, tracking was a problem because the points of tracking—

[Kelly McCauley, Conservative, Edmonton West, AB]

My understanding is that they are developing stronger tracking.

[Andrea Stairs]

Yes. The tracking capabilities are going in the right direction, but it's the pricing of the tracking capabilities. The pricing of services and tracking on letter mail, the packets, the things that are light parcels, are the challenge as well.

[The Chair, Conservative, Tom Lukiwski]

Thank you very much.

Mr. Weir, you have seven minutes.

[Erin Weir, NDP, Regina—Lewvan, SK]

Thanks very much. I really appreciate your testimony.

I'll start off with a point of clarification. When you talk about eBay Canada having about 90% of its shipping with Canada Post, does that include Purolator, or is Purolator part of the other 10%?