Navigating External Forces: Strategic Solutions for Tariffs, Strikes, and Carrier Disruptions in E-commerce

Introduction

In today’s interconnected world, the path from a shopping cart to a customer’s doorstep is more complex than ever. Global trade policies, labor disputes, and shifting carrier regulations continually reshape the logistics landscape. For e-commerce businesses, these changes aren’t just disruptions; they’re critical challenges that can impact costs, delivery times, and customer satisfaction.

Among the most significant disruptors are

1. U.S. tariffs

2. Canada Post strikes

3. and sudden changes in carrier policies.

Understanding how these external forces impact shipping strategies is crucial for staying resilient and competitive. This article explores the impacts of these issues on Canadian SMEs and the possible strategies to address them, with a focus on transportation brokerage solutions and logistics optimization offered by OGALO.

1. The Ripple Effect of U.S. Tariffs on E-commerce Shipping

The recent imposition of U.S. tariffs on goods from major markets like China, and many other countries including Canada, has undeniably complicated cross-border trade. Although they are very wide ranged, these tariff increases primarily target technology imports, manufactured goods, and raw materials, raising costs for SMEs that depend on these products. These new customs duties range between 10% and 25%, directly impacting the profit margins of Canadian small businesses that export to the United States.

Canadian SMEs, already facing post-pandemic economic challenges, must now contend with these tariff increases that amplify their operating costs. Exporting to the United States has become a real financial challenge for many of them. In addition to customs duties, businesses must deal with higher transportation costs, import taxes, and compliance fees for U.S. regulations.

However, for Canadian e-commerce businesses shipping into the U.S., there are two strategic avenues to manage costs and streamline logistics:

• De Minimis Rule (Section 321): Under this regulation, goods valued at 800 USD or less can enter the U.S. without incurring duties or taxes. This allows Canadian retailers to tap into the U.S. market with minimal friction, offering faster delivery times and simplified customs clearance. Leveraging Section 321 is particularly effective for low-value, high-turnover items, enabling Canadian merchants to remain competitive without being burdened by hefty import fees.

  
  

• CUSMA/USMCA Compliance: For shipments exceeding the De Minimis threshold, Canadian e-commerce businesses can take advantage of the Canada–United States–Mexico Agreement (CUSMA)—known as USMCA in the U.S. In effect since July 1, 2020, CUSMA aimed to facilitate trade between Canada, the United States, and Mexico. Compliance with CUSMA allows for reduced tariffs or even duty-free treatment for eligible goods, provided that proper documentation is submitted. This includes a certificate of origin and detailed commercial invoices to validate that products meet CUSMA criteria. While this option requires more administrative work, it significantly lowers the cost of doing business across the border for higher-value shipments.

It is important to note that these avenues can change rapidly. Since the beginning of 2025, the rules and tariffs related to cross-border shipments have changed many times so it is important to stay up-to-date on the current situation. A great source of current information is directly with the Canadian Trade Commissioner service:

Support for Canadian exporters faced with U.S. tariffs

By strategically utilizing both Section 321 for low-value goods and CUSMA compliance for higher-value shipments, Canadian e-commerce businesses can optimize their logistics and reduce the impact of U.S. tariffs.

2. The Impact of Canada Post Strikes on Domestic Shipping

Closer to home, labor disputes like the Canada Post strikes disrupt domestic delivery networks. When postal workers strike, parcels pile up, delivery guarantees crumble, and businesses are left scrambling for alternatives. For e-commerce retailers, this isn’t just an inconvenience—it’s a direct threat to customer satisfaction.

The Canada Post strike of 2024, which began on November 15, mobilized around 55,000 employees and had major impacts on Canadian businesses. According to the Canadian Federation of Independent Business (CFIB), this strike cost SMEs up to 76 million dollars per day, totaling approximately 1.6 billion dollars in financial losses. This also caused significant stress on private carriers such as Purolator, UPS and GLS due to the increased volume as Canada Post normally handles nearly 30% of the parcel shipment in Canada. This resulted in many service disruptions including delivery delays, pickup issues and an increased number of lost or damaged packages. A second strike is looming after the 22nd of May deadline as negotiations remain strained and, in its wake, the future of Canada Post itself is at risk.

Preparation is key in these circumstances. Here is a link that provides additional background and some tips for Canadian businesses:

Comment se préparer à une éventuelle grève ?

During these strikes, many retailers turn to private carriers to maintain service levels, but that often comes with increased costs. Some businesses also experience longer transit times, which can damage consumer trust. The ripple effects extend beyond delayed packages; they also strain customer service teams who manage complaints and expectations. For Canadian businesses that rely heavily on Canada Post’s extensive network, these strikes are a harsh reminder of the need for flexible shipping strategies.

Forward-thinking e-commerce businesses are now exploring multi-carrier solutions to avoid relying solely on Canada Post. This diversification allows them to switch seamlessly between carriers during strikes, maintaining delivery reliability and customer satisfaction.

Carrier Policy Changes—The Unseen Disruptor

While tariffs and labor disputes grab headlines, carrier policy changes often fly under the radar. Yet, these unilateral adjustments can be just as disruptive. Major carriers sometimes impose new surcharges, adjust pricing structures, or even alter delivery terms with little to no notice. For example, adjustments to fuel surcharges or last-mile delivery fees can dramatically increase costs for e-commerce companies.

Here are a few examples of carrier policy changes:

• Fuel Surcharges Adjustments: In 2022, major carriers like UPS and FedEx introduced significant increases to their fuel surcharges due to rising global oil prices. These adjustments were made with minimal warning, raising shipping costs for businesses across North America. E-commerce retailers suddenly faced up to a 20% increase in shipping costs, cutting into profit margins.

• Peak Season Surcharges: During the 2023 holiday season, Canada Post and Purolator implemented peak season surcharges on top of standard shipping rates. These surcharges were based on volume thresholds, impacting smaller businesses that struggled to negotiate better rates. For example, businesses shipping more than 500 packages per week saw rate increases of up to $0.50 per parcel, a significant jump during the busiest time of year.

• Dimensional Weight Pricing (DIM): In 2024, FedEx changed its dimensional weight pricing formula, which calculates shipping costs based on package size rather than actual weight. This meant that lightweight but bulky items became dramatically more expensive to ship. Small businesses shipping products like pillows, bedding, and lightweight electronics were hit particularly hard, as costs nearly doubled for some parcel categories.

• Remote Area Delivery Fees: Starting in early 2025, UPS expanded its list of "remote area" postal codes in Canada, triggering additional delivery fees for thousands of addresses. This change disproportionately affected e-commerce businesses that serve rural customers, with extra charges reaching up to $5 per package.

• Residential Delivery Surcharges: In late 2024, FedEx and UPS increased their residential delivery surcharges by nearly 15%, citing higher last-mile delivery costs. This affected all shipments directed to residential addresses rather than commercial ones, adding unexpected costs for e-commerce businesses selling directly to consumers. For example, a small business shipping 1,000 packages per month to residential addresses saw monthly shipping costs rise by $1,500 purely due to the surcharge adjustment.

  
  

These sudden shifts force businesses to quickly adapt or risk absorbing unplanned expenses. More critically, they can disrupt established logistics processes, requiring re-negotiation of contracts or even a shift to alternative carriers. For companies managing high shipping volumes, these unexpected changes are more than just a logistical headache—they can significantly impact profitability.

Savvy e-commerce brands are turning to multi-carrier strategies to mitigate these risks, giving them the flexibility to switch to more cost-effective options when carrier policies unexpectedly change. This adaptability is key to maintaining consistent delivery timelines and cost control.

Strategic Logistics Solutions To Minimize Impacts

To stay resilient and competitive, companies need strategic logistics solutions that minimize costs and reduce disruptions. Below are key strategies that can help optimize shipping processes, ensure continuity, and maintain customer satisfaction, even in the face of market volatility.

1. Diversification of Shipping Methods

   1. Explore alternative carriers to minimize risks associated with labor strikes, carrier policy changes, and seasonal surcharges.

   2. In the event of disruptions like the carrier strikes, switching to multi-carrier options ensures business continuity.

   3. OGALO offers flexible logistics solutions tailored to each industry, providing seamless transitions between carriers during service interruptions.

2. Optimization of Import Processes

   1. Leverage optimized shipping routes and strategic carrier selection to reduce transit times and costs.

   2. For cross-border shipping, particularly to the U.S., take advantage of the De Minimis Rule (Section 321) for low-value goods and CUSMA/USMCA compliance for larger shipments to reduce tariffs.

   3. OGALO canprovide some guidance in customs management for faster clearance and lower costs.

3. Reduction of Shipping Costs with OGALO

   1. Integrate smart logistics solutions to avoid unexpected surcharges such as fuel fees, residential delivery surcharges, and peak season adjustments.

   2. OGALO dynamically evaluates carrier options in real-time, selecting the most cost-effective and efficient routes. This minimizes exposure to sudden carrier policy changes and keeps shipping expenses predictable.

      

Conclusion

The current landscape of e-commerce shipping is defined by unpredictability. U.S. tariffs reshape cost structures, Canada Post strikes disrupt domestic reliability, and carrier policy changes introduce unexpected challenges. For Canadian e-commerce businesses, navigating these challenges requires more than just adaptability—it demands strategic logistics planning. Leveraging avenues like the De Minimis Rule (Section 321) and CUSMA/USMCA compliance can significantly reduce cross-border costs, while diversifying shipping methods can protect against service interruptions..

This is where OGALO becomes a game-changer. With its multi-carrier solutions, OGALO optimizes each shipment by selecting the best available carrier for every delivery, based on real-time conditions and cost efficiency. Whether it's rerouting packages during a postal strike, avoiding high residential surcharges, or ensuring streamlined cross-border transit, OGALO continuously adapts to keep your logistics smooth and cost-effective. In a volatile shipping environment, OGALO provides the resilience and flexibility that Canadian e-commerce businesses need to thrive. Unlike traditional methods, OGALO continuously adapts to market conditions and regulatory frameworks, guaranteeing the most cost-effective and reliable path for every parcel, every time.