on Dec 13th, 2010
in Finances: Cost & Revenue
| 35 comments
The Postal Service does not receive tax dollars to sustain its operations, but relies on accurate postage payments for support. While the vast majority of the Postal Service’s customers pay the full cost of mailing, revenue loss, otherwise known as revenue leakage, can occur when individual or business customers don’t pay the appropriate postage for their mailings. Postage may be paid in a number of ways. Customers can buy stamps at a customer service window and apply them to letters and packages as they need them, which can sometimes lead to underpayment of postage. Business customers can pay through meter or permit accounts. Business Mail Entry Units make sure that the correct postage has been affixed or claimed when discounts are claimed. Online sellers can use PC Postage and Click-N-Ship® postage with free carrier pick-up, eliminating the hassle of taking their goods to the Post Office to be weighed and shipped. Of course, this could lead to mistakes in mailings sent out under the wrong, and cheaper, mailing class for which the goods do not apply, such as mailing a set of skis as media mail. Because of its dire financial situation, it’s now more important than ever for the Postal Service to protect the revenue it is due whether it comes in from the post office window, meters, online postage accounts, or from permit accounts. Now is the time to share your thoughts and help the agency get back in the black. What are the best ways to protect Postal Service revenue? Enter your comments below. The Office of Audit Sales and Service team is hosting this topic.
on Dec 6th, 2010
in Finances: Cost & Revenue
| 8 comments
Mailings that meet minimum volume and preparation requirements to qualify for reduced postage rates are called business mail. Properly accepting business mailings is critical for the Postal Service since it accounted for $25 billion in revenue in 2010. Several types of Postal Service facilities accept business mail. Business Mail Entry Units have acceptance clerks with specialized training and systems for accepting business mail. Local Post Offices can also accept business mail. Most revenue for bulk business mailings is recorded using a system called PostalOne!. PostalOne! has built-in controls that assist clerks in properly accepting the mail. However, approximately 11,000 units that recorded more than $114 million in Permit Imprint and Periodicals transactions in FY 2010 have been forced to operate without PostalOne!. Regardless of the level of training or type of system used, each unit must accept, verify, and collect postage for mail according to required policies and procedures, a process for which it is crucial to have PostalOne!. If classified and accepted improperly the Postal Service risks accepting improperly prepared mail or mail paid at an improper rate. For the past several years, the Postal Service has faced significant revenue losses due in part to decreased mail volume and increased competition from other media alternatives. The Postal Service must continue to explore opportunities to improve processes and eliminate redundancies in their system. Because business mail acceptance generates a significant amount of revenue, the Postal Service may want to reevaluate the number of entry points for accepting business mailings, including the 11,000 units not on PostalOne!. Do you think that the Postal Service should restructure the entry points for business mail? Give us your comment below. The topic is hosted by the Office of Audit Field Financial – East team.
on Nov 29th, 2010
in Finances: Cost & Revenue
| 8 comments
The sale of stamps and related products are a core Postal Service business. The Postal Service prints billions of commemorative and definitive stamps annually to enable customers to mail pre-paid domestic and international mail and to also encourage stamp collecting. Given the traditional importance of stamps to the Postal Service, it is vital that the process by which stamps are distributed to customers be both timely and secure. Stamp Distribution Centers (SDCs) issue stamps to thousands of Post Offices, postal stores, and contract stations (sites under contract to the Postal Service typically located in retail establishments) nationwide. Not only do the SDCs distribute all accountable stamp items (stamps, coils, envelopes, and postcards), but they also accept obsolete and redeemed stock for destruction. During fiscal year 2010, the Postal Service consolidated its existing stamp distribution network into six SDCs. The goal of this consolidation was to standardize and automate work processes, reduce space requirements, improve transportation, and reduce stamp destruction costs. This topic is hosted by the OIG's Field Financial-East audit team.
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