on Jun 18th, 2012
in Post Offices & Retail Network
| 10 comments
Americans are passionate about their post offices as they made clear when the Postal Service unveiled its original plan to close 3,700 post offices, most of them in rural areas. Last month, the Postal Service announced a new plan to keep post offices opened but reduce the operating hours at 13,000 locations. These low-activity post offices would be open only 2 to 6 hours a day, which the Postal Service says would save it $500 million a year. The Postal Service also plans to upgrade about 4,500 current part-time Post Offices to 8 hours of daily window service. Post offices are viewed by many as a gathering place for citizens and central to a community’s social and cultural identity. Some argue the Post Office is not just a profit-based retail establishment; it is part of the Postal Service’s larger public service mission. Perhaps the Postal Service should consider expanding the services it offers at post offices before it closes them. But others say the Postal Service needs to reduce its operating costs by right-sizing its retail network to match the new reality of a changing communications market. Nearly 80 percent of the 32,000 Post Offices operate at a loss. About 12,000 post offices average daily revenues of less than $68 per day, and one third of those Post Offices have average daily revenues of less than $25 per day. Closing low-activity post offices would help the cash-strapped Postal Service save money. What do you think about the Postal Service’s Post Office Structure Plan, or POStPlan? Does it make sense to reduce the hours at low-activity post offices or should the Postal Service close them altogether? Or is there a better retail plan that considers a more targeted approach, such as offering new services in Post Offices and/or extending the hours at some post offices while closing others?
on Jun 11th, 2012
in Products & Services
| 14 comments
A 100-year old temperance-era law prohibits the Postal Service from shipping alcohol and benefiting from the growth in online purchases of wine, beer, and other spirits. As states have loosened their restrictions on inter-state alcohol shipments, FedEx and UPS have seized this burgeoning opportunity. The Postal Service needs to secure new sources of revenue in an era of declining mail volume. Shipping of alcohol could create an additional revenue stream, while capitalizing on the Postal Service’s strength in last-mile delivery. Shipping of alcohol would require the Postal Service to establish a strict set of rules. First, it would have to be sure no one under age 21 receives alcoholic shipments. Second, it would have to comply with varying state laws, some of which prohibit the shipment of out-of-state alcohol directly to consumers. Other states allow direct shipments to consumers but restrict those shipments to producers, such as wineries. The Postal Service has indicated it would put proper restrictions in place, such as requiring an adult signature for shipments of alcohol. It even appears to have ideas around flat rate boxes that could hold two, four, or six bottles of wine. With the right restrictions in place, should the Postal Service be allowed to ship alcohol and tap into this growing market? Or should an organization that is part of the federal government stay out of the business of shipping alcohol given the negative images sometimes associated with alcohol consumption? What do you think? Share your comments below. This blog is hosted by the OIG's Office of Audit.
on Jun 4th, 2012
in Products & Services
| 14 comments
Following the success of the Priority Mail ® Flat Rate Box® advertising campaign, the U.S. Postal Service has decided to use the “If it fits, it ships” letter carrier (actor and comedian Mike Bradecich) as the public face for one of its newest products, Every Door Direct Mail (EDDM). The campaign’s new tag line, “Every home, every address, every time” describes the new product’s main advantage: small businesses can target every address in their local area without having to provide every name and address. EDDM is a different product than the Flat Rate Box because it’s geared toward small business customers. The Flat Rate Box is intended for both individuals and businesses. One of the new television commercials points out the value of direct mail for small businesses over other types of advertising options like billboards. This message is intended to appeal to local businesses, like restaurants and doctor’s offices, which may not advertise much to begin with and face tough decisions about where to put their limited advertising dollars. It remains to be seen whether a mass media advertising campaign is the best way to bring these small businesses into direct mail, even if supplemented with direct mail and online advertising. Check out two of the new television advertisements: Official USPS Chicken Commercial Official USPS Billboard Commercial The main message in the campaign is simplicity. Businesses no longer need mailing lists, and they can drop off their mail (up to 5,000 pieces) at their local post office instead of Business Mail Entry Units. Given the smaller audience and the larger cost for this product, it remains to be seen if EDDM will be as well received as Priority Mail, but the Postal Service appears to believe this product has potential. Revenues for EDDM since April 2011 (when the product was introduced) have grown rapidly and could increase as the economy continues to improve. The advertisements began running in April on TV and the campaign will include print, radio, and direct mail. So, tell us what you think about this new advertising campaign. Have you seen the new advertisements? How do you think this advertising campaign compares to the Priority Mail campaign? Does it do a good job of addressing the needs of small businesses?
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