on Oct 31st, 2011 in Pricing & Rates | 12 comments
 
When mailing a letter that weighs about one ounce, the U.S. Postal Service’s 44 cents is one of lowest First Class postage rates. Whether you are mailing a letter locally or sending a greeting card across country, it still only costs 44 cents now, but will increase to 45 cents in January. The graph below compares the U.S. Postal Service’s postage rate with other countries. As you can see, Norway charges the highest rate, which is nearly four times the cost U.S. rate.

 

Source: 2011 Office of Inspector General analysis of Universal Postal Union data

Some might feel it is reasonable for the Postal Service to increase rates and charge a fee comparable to those in other countries. On the contrary, others might say the Postal Service’s rate must remain at an affordable level, especially for people with lower incomes. They might also say raising the rate to a level found elsewhere would drive customers away even faster. When you think about prices paid for other goods and services, just how far does 44, 50, or even 75 cents go? By comparison, a small cup of coffee at McDonalds costs a dollar, a gallon of gasoline is over $3, and a gallon of milk is about $4. Share your thoughts below. This topic is hosted by the OIG’s Financial Reporting Directorate.

12 Comments


I think we get an incredible deal here. Even with the postal rates increasing for the second time in recent memory. I send mail all the time. Over 20 pieces each week..and I still think I get an excellent deal for all the traveling my mail does. This graph is an excellent way to show just how far our 44 cents gets us in comparison to other countries.

We have cut about as far as possible. Service is slipping. Our management has not marketed our great service and low rates. UPS and FEDEX raise rates to remain profitable. Our management has let us down. Go to Congress and change rate changing method and quit begging.

We are one of the wealthiest countries in the world, yet we squabble over increasing the cost of a stamp??? Individual use of 1st Class mail is declining and will continue to decline. The up and coming generations will use automatic bill pay or pay their bills via the internet using their cell phones/tablets/computers. So please quit these petty 1 cent increases the merely erode the volume little by little causing a slow and painful death of a valuable agency. Instead, rip the bandage off and raise the rate to 50 cents or whatever amount is necessary to cover the expense of universal service. Also, the USPS must get out of bed with the larger mailing industry and raise rates for them. Any discounts catalogers receive should be in relation to the volume of products they ship vis USPS. Non-profits rates should be based on an organization's administrative frugality/overhead rates so that the large discounts are given only to those that are truly just a charity. Politicians and PAC's should also be paying their fair share for campaign advertisements. I doubt that the cable/television or radio industries are giving them a free (reduced) ride. If we raise rates a considerable amount, yes we will lose customers, but we will also found out who is sticking around for the longer haul.

Well, it actually depends on how many times it is missent, or turned around.

And, from this casual observers post, it's alot of miles in handling,
fuel consumption, labor, and of course the all encompassing management
strategies, and initiatives. Very creative economic initiatives are deriving real value here.

And, the whole recycling concept is unique. Rather than deliver it
and let someone else dispose of the BBM, the USPS rises to the task and re-handles this pesky little detail. In our community, we donate unwanted paper for non-profits or the "children". At least I think that's where it goes???

For the sake of transparency I believe customers need to know how the .44 cents spent for postage is applied against operating expenses, for example 1 penny for fuel, 3 cents for facilities/infrasctructure, 40 cents for wages/personnel etc.
Explaining out the requirements may help make the case of postal rate changes.

I agree with you MFrancis 100%.

SWEET SICK LEAVE, How can I get some of that action beech? All I get is what the Owl left on the stump. I mean I'll take just 15% of the benefit of what the pathetic managers, who have ZERO knowledge of transportation, much less have ever managed transportstion assets. Yet, this asset at the USPS makes up 60% of the entire process of the business model.

Thanks to everbody for your responses! - KH

Since I been waiting for 6 days for a letter that has my company check for payroll,supplies and living expenses. The Postmaster of Niceville, FL. inform me that I must wait. With no attemp to find it. So when we have our next convention I will push a motion for our company to go to direct depoist. Banks worry a lot more about mistakes than the USPS. Thank You

PS On your website there doesn't seem a complaint section.

That's all part of the "Strategic Vision", which by the way, was highlighted in the congressional sub-committee hearings yesterday!!!!!!!!!!
My only question to you is, what have you been waiting for?
Is the postage expense tax deduction worth that much???
Or is your cousin responsible for mail at your company?
I would however, favor hiring the disabled or disabled veteran for that postion, then you would enjoy the benefit of assuring a hero would be employed. Along with the ancillary tax credit, which in my opinion is simply intended to give incentive. However, I personally don't need incentive. Yet, I'm of the opinion that most veterans these days are far more talented in other technologies.
Sorry, just blathering.... Thinking about tomorrow, Veterans Day, and those we honor..

Some of the reason for the lost revenue is first the forever stamp. People buy them up and hoard them. They also became exremely popular because of the many 1 and 2 cent increases. Nobody likes playing with 1 cent stamps. Should have made 5 cent increases so you only need to add 1 extra stamp. Right now i say go for a 10 cent increase every year for a couple years. The other issue is the unfair distribution of mailboxes. I drive 4 miles to the nearest mailbox and see 3 more within a mile and the 4th one is in a post office lot. Consolidate mailbox pickups and delivery to one truck not two. We had a mailbox right outside our apartment complex and it was removed for supposed lack of use.

The US Postal Service has always been taken for granted for their integrity and honesty in that they operated on an old-world philosophy governed by keeping their service available to the people at a reasonable price. Though it is a pity that the postal service must squabble about jacking the price of a stamp by a freaking penny, I must admit to having been greatly annoyed on many occasions where the postage increase coincided with the prior month's purchase of a large number of stamps. The annoyance, of course, being the need to make a trip to buy a roll of low-denomination stamps to cover the hike.

The only sad bit now is a hindsight view of the situation of old-world thinking. The management of the USPS royally dropped the ball by not taking enough extreme measures in response to the rapid-succession of deployment of the modern communication protocols of cell phones, text messages, and email.

It is not entirely too late for USPS to take an approach similar to the way the oil industry. Rather than squabbling for a few freaking pennies, they should jack the price of a stamp by $0.30 or more at a time. In so doing, they will generate more revenue by people hoarding 'Forever' stamps. Money in the bank earns interest, right? Oh wait....

Look at that. Here I was so wrapped up in the way the USPS is declining due to 'free' competition and ired by the massive oil industry heist that I completely forgot about how the banks can no longer screw us over as hard and thus they don't pay interest any more. Sorry USPS management. I thought I had it all figured-out for you.

Oh well. Maybe I can pass-along some advice that holds water in a decade or so when the world economy starts working again. Of course, whether you are able to get that advice will depend totally on the efforts of our new leaders, the Chinese, in enforcing censorship.

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