• on Feb 13th, 2012 in Strategy & Public Policy | 12 comments

    According to the Postal Service, greater use of electronic communication continues to drive customers away from using First-Class Mail®. Instead of buying stamps, many customers pay bills online, send ‘e-invitations’ to friends and family, and simply press “Send” when they want to communicate. These shifting customer habits will continue to speed the migration away from traditional First-Class Mail. According to the Postal Service, First-Class Mail has dropped 25 percent and single-piece First-Class Mail – letters bearing postal stamps – has declined 36 percent in the past 5 years.

    Postal Service customers and others have complained that the planned consolidations and the elimination of overnight service standards will adversely affect them. On the other hand, the Postal Service claims that these consolidations are financially necessary and create a delivery network that more accurately reflects the current volume of mail.

    1. What are your thoughts on the consolidations? 2. How will the elimination of overnight service standards affect you? This topic is hosted by the OIG’s Planning, Innovation and Optimization Directorate. NOTE: An audit report, U.S. Postal Service Presents Network Optimization Initiative, shall be issued in tandem with this blog.
  • on Feb 6th, 2012 in Delivery & Collection | 17 comments
    In an effort to reduce costs, the U.S. Postal Service has proposed cutting delivery service to five days per week by eliminating Saturday delivery. For a moment, let’s ignore the argument over whether the delivery days should be cut to five to ask another question: is Saturday the right day to cut? While the Postal Service says Saturday has the lowest daily mail volume, it is the one day when most people are home to accept their mail. Some mail recipients say that Saturday is the delivery day they would least like to eliminate. Many periodicals and advertising mailers value Saturday above all other days because their customers have more time to read their magazines and ads and are more likely to act on them. Equally important, busy households are also available to accept packages—a competitive advantage the Postal Service has over the competition. Lastly, eliminating Saturday delivery could further crowd post offices with customers retrieving their packages. In its recent filing with the Postal Regulatory Commission proposing the end of Saturday delivery the Postal Service did not cite the impact on service of having two consecutive non-delivery days (such as Saturday and Sunday). Eliminating delivery on Saturdays or Mondays could slow service more than eliminating it on some other day. For example, let’s take a product like Priority Mail or First-Class Mail that we will assume takes exactly two days to be delivered after it is deposited. Since the Postal Service does not accept or deliver mail on Sunday, the current average delivery time would be 2.17 days. If you end delivery on Saturday, the average delivery time would increase to 2.50 days (pieces sent on Friday and Thursday would take 3 and 4 days respectively). Alternately, ending Tuesday service would keep the average delivery days at 2.17. So ignoring the argument over whether it makes sense to convert to 5-day delivery, would it be better to cut Saturday delivery rather than some other day? Are there better options? Would it be possible to end Saturday delivery for business addresses while eliminating Tuesday delivery for residential addresses instead? Tell us what you think.

    This blog is hosted by the OIG’s Risk Analysis Research Center.

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