Much emphasis has been placed on reducing the Postal Service’s costs in response to its financial crisis. Yet financial viability could come in the form of a balanced approach that both reduces costs and increases revenue. How would a smart business respond to declines in its major products? Would it raise prices where possible in stagnant areas and invest the proceeds into existing or new growth areas? Would it selectively discount products to grow volume in price sensitive segments? Disruptive innovation, such as that underway in the communications sphere, requires change to ensure the Postal Service has what it needs to move beyond the critical crossroad it faces today.
The Office of Inspector General Risk Analysis Research Center’s new paper Postal Service Revenue: Structures, Facts, and Future Possibilities (Report Number RARC-WP-12-002) addresses the major components of the Postal Service’s revenue structure in Fiscal Year (FY) 2010, assesses existing opportunities permissible under the current framework, and discusses future options and policy considerations in a new era.
Loading ...Click here to read the Postal Service Revenue: Structures, Facts, and Future Possibilities white paper.
How would you approach the revenue issue to make sure the Postal Service continues to provide self-funded universal service to the American people?
This blog is hosted by the OIG’s Risk Analysis Research Center.
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Offer more services at the window to sell and that we could deliver. Talk to the rank and file the ones who do the job everyday we have ideas but are never heard.
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Systemically important institutions should be required to do all their electioneering via USPS mail, with full disclosure on the mailpiece. You guys could regulate. #postageNOTpayola
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Cutting costs is great and we have tightened up many screws. Let’s stop kidding ourselves. We need heavy duty marketing and more revenue. Some rates need to rise. (We need to up sell our First Class 44 cent VALUE.) Let’s add revenue by authorizing(and promoting) Delivery Confirmation on letters. We would lose some Certified Mail volume but continue this for Return Receipts. If we could up sell more letters with a 50 or 75 cent “letter D.C. special” this would add more revenue.
Let’s look at Insured Mail. I do not know our revenue but claims detract and are time consuming. (I think UPS generally includes a certain amount of insurance as part of their fee and I know they don’t like to process claims either) Let’s evaluate adding “FREE INSURANCE” to Priority Mail parcels, pay for it with a few cents of rate bump and sell it, up selling PP to Priority Mail at the same time. This might require some rate studies but we have 100′s of bodies to handle that.
Adding alcohol’s to allowable shipping is OK but let’s “lose” all the 19th century prohibitions like raffle tickets (FEDEX makes a killing) and firearms, dominated by UPS. These items require some safe guards but the other make big bucks and we could, too.
Let’s go out and sell what we do well!
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Get rid of the Bonuses..
Stop wasting the money on waxing floors that should not be waxed..
Cut management..
Consolidate..
Layoffs
Stop hiring Idiots..
Most of all, stop promoting IDIOTS…
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I think the whole postal union has to stop running the PO – streamline jobs & job functions – you probably don;t need near as many supervisors as there are now. The PO needs to be run as a real business – when REAL businesses come up on hard times, benefits, raises, promotions etc are frozen. Hiring stops and fat is cut. People don’t get raises and promotions because they are “due” they get them because they are earned and because there is the money to do so. There needs to be an end to extravagant retirement & health benefits. Just because it’s always been done doesn’t mean it has to go on being done. Is the postal service REALLY going to go belly up because it can’t be run like a real business?
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Suggestion: Eliminate that requirement that the USPS contribute to the health pension plans of people who won’t even work there for 65+ years.
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They need to look at how some routes are being delivered. Why are carriers still walking house to house? Convert these routes to cluster boxes and stop the foot routes where possible. Also convert streets that have one box in front of each house to cluster boxes where possible. This would save time, labor, and gas.
I live in a townhouse development and it isn’t that hard to walk 2 driveways over to get my mail.
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the news paper just went from$1.50 to $2.00
GAS GOES UP FOOD GOES UP
WE NEED TO GO UP TOO
RAISE THE PRICE OF STAMPS TO .75 CENTS NOW!!!!!!!!
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Do NOT send more junk mail! Revenue for USPS at a cost to the environment and consumers’ time is not a reasonable trade off
Well-loved. Like or Dislike:
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I love the flat rate stuff. Also the talk of taking out Saturday is CRAZY it is the one day that non of the other companies offer. It is one of your greatest assesstes.
Giving up Tuesday would be okey I think.
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Delivering mail on Mondays Wednesdays and Fridays would suit my needs just fine. Thanks
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Raising prices can only go so far in a competitive market. Package service and other nonmail items are markets that are an area of tremendous opportunity. UPS and other competitors have sales officials that go from business to business to explain the benefits of using their products. Why isn’t the Postal Service doing more of this? The service and prices offered by the Postal Service are a huge selling point. Show the customer we will work with them to provide solutions to thier mailing needs and answer thier questions.
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I just want to see the USPS succeed. More marketing and better service might be a good start.
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(1) Stop offering presort discounts beyond 5-digit for any machinable mail destined to a ZIP that receives DPS mail. Why give mailers a break for carrier-routing or walk-sequencing that mail when we run it anyway?
(2) Stop accepting standard “for delivery” on holidays. We won’t deliver it. We shouldn’t indicate that we will, nor put ourselves in the position of attempting the impossible (the accumulated FCM, the “delayed” STD, and the STD for delivery the day after the holiday).
(3) Reduce overtime and over/understaffing problems by “leveling out” the incoming standard mail, and selectively raise rates to compensate the USPS for any overtime costs incurred. How to do that? (1) See #2 above. (2) Charge a higher rate for STD mail that is “scheduled” to be delivered on Mondays and any day following a holiday. If mailers really want that, they’ll pay (and support the overtime that results). If mailers don’t want that, they’ll save money by mailing when we can better handle the volume. (3) Bite the bullet and spend the money for software that will show to BBM acceptance facilities a real-time nationwide STD mail acceptance volume according to destination, and then tie rates to volume such that exceeding a given volume for a particular ZIP (ie, something that mail processing will have to process!) triggers a choice for the mailer, namely paying more or postponing all or part of the mailing until the following day. (4) Exempt small-volume local mailers from the above (ie, the 250-piece newsletter mailing). Those don’t impact us like the big mailers.
(4) Avoid “solutions” that use more fossil fuels. Fuel prices are only going up, and they are potentially very volatile (look what has already happened) … and thus will NOT be solutions, but problems in the long run (maybe not-so-long run). Alternative fuel development is probably not financially feasible right now, but the USPS does own buildings that take up a LOT of square footage and have big roofs, which can provide solar power, either to the facility or to a local utility; this would include leasing roof space for solar power generation rather than expending the capital on solar hardware.
(5) Although it is true that much of what used to be done by mail can be (and is being) done via internet, it is also true that many rural areas don’t have high-speed internet, and also that not everyone can afford internet. What about equipping selected rural post offices with internet access stations, and charging a fee for an email address (one per individual, and not available to addresses served by high-speed internet), secure on-line storage, and a basic number of minutes with an upcharge for additional minutes? This would have to be thought through carefully to protect equipment and individuals’ privacy, and also to prevent abuse. But in the places where there is a need, it will keep those small rural post offices relevant and increase revenue.
(6) Have a more accessible means to submit ideas. I found this entirely by accident. Many people who work “on the ground level” have money-saving and revenue-generating ideas, but they’re lost when filtered through management, especially MANY layers of management.
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And a couple of other ideas I left out (that’s what happens when I try to think after a LONG night DPS-ing 100K+letters, a significant portion of that time ALONE):
• Re: #3 above — also weight STD rates according to the time of the month, giving STD mailers incentive to give us greater capacity for the predictable “first-of-the-month” FCM onslaughts.
• Totally crack down on “machinable” mail that does not run well (or at all) and “barcoded” mail that won’t read. It is costly even when not discounted (jams, damaged mail including unrelated mail that WAS machinable before getting caught in the fray, followed by manual sortation); discounting that mail in any way is an even greater revenue loss. All those flimsy “privacy notices” that fold and wad up … the mailer whose coupon barcodes confuse our WABCR and cause a high percent of rejects … the mailer whose envelope windows rip, cause jams, and cause nonreads (their mailing and others that the “window” pieces adhere to) … the mail that comes in pre-bent and won’t unbend … the mail with weeny glue that unfolds during processing … I could go on and on, but the point is that there are problem mailings EVERY night. This represents a significant revenue loss that we can ill afford, and regardless of whether the USPS is viewed primarily as a service or a business, it is both unfair and foolish to grant discounts for mail that needs additional (rather than less) processing!
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Stop delivering residential mail 6 days/week! It wastes about 500,000 gallons of gasoline every day! (Plus salary costs and everything else associated with delivery.) How about Monday, Wednesday, Saturday? (Don’t cut Saturday, it’s really the most convenient time to get the mail for a lot of people.)
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Prepare to wind down. Snail mail is all but over. Stop trying to hang on to it and stop using junk mail to subsidize your operations. I would eliminate my mailbox if I could because all I get there is junk mail that I must PAY to recycle. Sorry, but your principal product is no longer viable, and others provide the other products just fine. Merge with UPS and use your infrastructure for package delvieries.
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You’re fundamental problem is that by pandering to direct marketers, you have created a product that nobody wants. 95% of what you deliver goes straight in the trash. Nobody is interested in paying more to have our box stuffed full of trash. Daily delivery to every house in America is also a terrifically outdated, wastefull, and environmentally destructive practice. I say: reduce residential mail delivery to once a week, give people the ability to opt out of all junk mail, and charge what you need to to be sucessfull. I’d happily pay a dollar to mail a letter if I didn’t have to sort through a mound of junkmail every day.
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Require more houses to have a mailbox at the curb, so the carrier doesn’t need to walk up to every house. This would save time and prevent a lot of dog bite injuries.
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I love some of the ideas from USPS employees! I would use Delivery Confirmation on letters if it were available. I wouldn’t mind getting mail fewer days per week, as long as my packages weren’t delayed. You are still the best shipper for small packages!
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Get rid of the sloppy sub mail people.I live in burlington vermont everytime our regular is out we get a relly sloppy sub who does not case the mail correctly.
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