Canada Post has just announced a change in policy that will negatively impact our business.

The change in policy is that from September 19th, 2005 onwards lettermail may no longer contain any items which are not documents. Canada Post�s decision to restrict lettermail to documents only is arbitrary and extremely damaging to small business.

By way of example, our best selling item is a packet of fabric squares used to make quilts. It sells for US$6.99. It measures 6.75� x 6.75� x 0.1� and does not sag in the middle and weighs 47 grams. In December, 2004 it cost US$0.85 to ship this item. Now, due to fall of the US dollar and increases in Canada Post rates (effective January 17th, 2005), it costs Cdn$1.82. On Sept. 19th this is going to increase to Cdn$5.60 (small packets airmail rate � our customers won�t wait for surface mail). That is a 560% increase in less than a year. I do not believe that our customers will be willing pay that amount for shipping. Therefore we will lose customers and I am quite worried that if we don't drastically change our business model that we will lose our business.

In the last 18 months we have spent over $7000 at Canada Post. We are a small business but are profitable. Selling on eBay allows me to stay at home with my children while also contributing financially to our family and in my own small way to the Canadian economy. To maintain my business I need to compete with American sellers. The relative strength of the Canadian dollar has made it very difficult to make money selling Canadian product to the United States. Additionally, American sellers have the advantage of flat rate priority mailers and media rate packaging as it is - if I lose the letter mail pricing I will lose a significant proportion of my sales. If I lose my business I am no longer earning any money - that hurts everyone.