Postal Service Takes Next Step in Optimizing Retail Network

As more customers choose to conduct their postal business online, on their smart phones and at their favorite shopping destinations, the need for the U.S. Postal Service to maintain its nearly 32,000 retail offices — the largest retail network in the country — diminishes. To that end, the U.S. Postal Service announced that it will be taking the next step in right-sizing its expansive retail network by conducting studies of approximately 3,700 retail offices to determine customer needs. As part of this effort, the Postal Service also introduced a retail-replacement option for affected communities around the nation. “Today, more than 35 percent of the Postal Service’s retail revenue comes from expanded access locations such as grocery stores, drug stores, office supply stores, retail chains, self-service kiosks, ATMs and usps.com, open 24/7,” said Postmaster General Patrick Donahoe. “Our customer’s habits have made it clear that they no longer require a physical post office to conduct most of their postal business.” Please click here for the list of retail offices being studied.

Source: USPS Press Release

PMG Speaks Out

The Postmaster General Pat Donahue recently spoke to Tom Sullivan of Fox Business News about the financial woes facing the U.S. Postal Service and the future of the agency. Watch the interview here.

Is Curbside Delivery the Answer to USPS Woes?

Would the majority of Americans give up their door-to-door delivery to help save the USPS? That’s the question the Office of the Inspection General is asking. The July 7 OIG report recommends that the USPS develop a comprehensive plan to “aggressively move” from door-to-door delivery to curbside delivery, which could save more than $4.5 billion a year. Further, the report says, the Postal Service should also evaluate savings opportunities by converting from curbside to centralized delivery and mandating centralized delivery for new delivery points. Centralized mail delivery via a "clustered" type mailbox including free-standing, pedestal-mounted or other cluster mailboxes mounted in a wall, kiosk or shelter, could save the USPS an additional $5.1 billion, the OIG report says. Not only would this strategic plan significantly reduce delivery costs, the report notes, it could be implemented internally through policy changes. And it would not require congressional approval—unlike moving from six-day to five-day delivery.

Source: MultiChannel Merchant

The High Cost of Low-Cost Mail

The past few years have been tumultuous for the USPS, which has experienced declining mail volume and unprecedented financial losses. The U.S. Postal Service Office of Inspector General Risk Analysis Research Center has published The Cost Structure of the Postal Service: Facts, Trends, and Policy Implications, which reviews the major components of the Postal Service’s 2010 cost structure and presents insights to the ongoing policy debate about the future of the Postal Service. The paper’s key findings conclude the mail business is labor intensive, and labor makes up 80 percent of Postal Service expenses. In addition, the total cost of benefits to the Postal Service has risen an astounding 448 percent above inflation since 1972, while the real amount spent on wages has declined by nearly 3 percent.

Source: OIG Pushing the Envelope