The Proposed USPS Network: A Second Best Solution

Yesterday the Postal Service presented its proposal to restructure its processing and transportation network.   The proposal is a second best solution meaning that pricing,  financial, labor contract constraints prevented it from making a proposal that could provide better service or further reduce operating costs. Pricing and Services The change in First Class service standards mostly reflect the results of the constraints the Postal Service has on raising First Class rates to cover peak-load and transition costs.  Switching to a network of fewer than 200 plants would have some service impacts but would not require adding a day to the current service standards without changes to plant operating plans. An analysis of the proposed network could [...] Read more »

A Financially Self Sufficient Postal Service

Three recent articles and blog posts illustrate why any postal reform measure has to go beyond fixing retiree obligations or restructuring operations to reduce costs.   If the White House Postal reform bill does not deal with these three issues than Congress will likely have to revisit the Postal Service Business model again in three or four years. Read more »

Postal Service Plans to Cut More Post Offices

In an interview with Kelly Holmes of My Print Resource, Deputy Postmaster Ron Stroman indicated the Postal Service’s retail optimization initiative before the Postal Regulatory Commission was just the first phase of a muti-phase plan.   In the interview he indicated that the the next phase will look at another 4,000 Post Offices, stations and branches. Given the current review process that includes both the current Postal Regulatory Commission review of the Postal Service’s proposal as well as review of possible appeals, The next phase of the retail optimization will likely occur sometime in mid to late 2012.   Upon completion of these two phases, as well as retail closure efforts already [...] Read more »

Postal Service Cannot Avoid Layoffs

The Postal Service seeks to cuts its full time employees by 228,000 in the next two to three years.  A review of attrition rates over the past three years indicates that layoffs are unavoidable.  Even with early retirement incentives, layoffs will likely be between 120,000 and 130,000.  Without these incentives they would be even higher.Attrition of Employees over 50Attrition of Postal employees over 50 comes from retirement, death, and voluntary and involuntary separation from the Postal Service  Early retirement incentives were offered to different groups of employees in 2009 and 2011. So the attrition rates below include the impact of these incentives.Regarless of the reason an employee over 50 left the [...] Read more »

100 Years of New Yorker Covers Illustrates How America’s Connection with the Postal Service Has Changed

The New Yorker in its current issue has an article that shows covers with postal themes over the past 84 years.   The covers show the gradual shift of the perception of mail and the Postal Service. Looking at the covers, the illustrators clearly show the changes and present a fairly scary picture of the future of the Postal Service.  Covers from the 1920′s through the 1970′s show the Postal Service as the critical communications link between households and other households.  A cover from 1973 illustrated mail as a critical part of political campaign communications with voters.   Today’s campaign mailings are a significant step beyond volunteers hand-addressing and stamping envelopes as shown in that [...] Read more »

Flooding in Pennsylvania will Delay Shipping

Flooding in eastern Pennsylvania will have a big impact on e-commerce shipping in much of the eastern United States.   The area facing record level flooding is home to fulfillment centers of nearly every large e-commerce company.  With roads closed, these centers will have difficulty both getting products delivered to the centers and shipments to customers out.   Among the e-retailers that will be affected is Amazon which has three fulfillment centers in the region. Shipments from United Parcel Service, FedEx and the Postal Service that travel by ground through this region will need to find circuitous alternative routes as some major Interstates may remain closed for a few days.   The delay in [...] Read more »

Senator Coburn on the Postal Service: Free Management

CNN interviews Senator Tom Coburn on the Postal Service.   In his answers to John King’s questions his focus is on freeing management to run the Postal Service with the same flexibility any other business would have to meet market demand.  He does not indicate support for any approach to Postal reform but clearly states that operating subsidies are out of the question as far as he is concerned.  Senator Coburn clearly shows his support for the current Postmaster General and appears to indicate that he would trust him to run the enterprise if he had the freedom to run it.  He also clearly states that there is no money to [...] Read more »

Comparing the Postal Service and Canada Post in Advertising

Today, I received the following e-mail   It shows how a company that sells envelopes, mailers, and folders is using the Postal Service’s problems to sell its products.  What is striking in the copy is how it contrasts the management of the Postal Service with Canada Post.  This has got to hurt at L’Enfant Plaza.  It shouldn’t as the difference between the two reflects not management ability but the business model that the enterprise most operate under.  The Postal Service still operates closer to a government department model than it often admits publicly.  Canada Post operates under a business model that is very close to the standard Canadian corporate model. While Canada Post may not [...] Read more »

Amazon Preparing For Postal Service Shutdown

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On September 2, 2011, The Daily reported that Amazon is now preparing to test a locker based system for parcel delivery in the Seattle, Washington.   The lockers, to be placed in 7-11 gives Amazon an alternative means of delivering shipments that avoid home delivery and the issue of repeated delivery attempts.  If Amazon puts one in every 7-11, it will have 8,200 parcel pick-up locations nationwide. Seattle is one of the markets that Amazon currently offers local express delivery. Items eligible for local express delivery can be ordered as late as 1 pm for delivery that day.   The parcel lockers allow Amazon to cut the delivery time on its shipments by reducing [...] Read more »