• on Sep 20th, 2010 in Delivery & Collection | 58 comments
    Although eliminating Saturday delivery has been heavily debated, reducing delivery to 5 days a week may not be enough. There has been some discussion of whether the viable model for the U.S. Postal Service of the future will incorporate 3-day delivery. A 2010 study by the Boston Consulting Group for the Postal Service forecasts that the average pieces of mail per delivery point per delivery day will drop from 3.8 to 2.8 by 2020. If this projection holds true, then more households will likely receive no mail on any given day. With the increasing availability of alternative communication choices, it is unlikely that the demand for mail delivery will ever return to previous levels. Therefore, postal delivery may only be needed 3 days a week. Some homes could receive mail on Monday, Wednesday, and Friday, while others, on Tuesday, Thursday, and Saturday. Delivery would still occur 6 days a week for Post Office boxes. This additional benefit for P.O. Boxes would meet the needs of customers who have need of 6-day delivery, while generating higher revenue and increasing traffic for the Post Office. For many customers in the future, the amount of mail they will receive on a given day may not warrant the effort required to check their mailboxes every day. Delivering 3 days per week roughly doubles the amount of mail a household receives on a given day, making the “mail moment” of receiving mail more significant. The savings could be significant. With the Postal Service estimating a $3.5 billion saving from cutting one day of delivery, cutting three days could save roughly $10 billion. An additional benefit of this every-other-day schedule is that about 50 percent of the mail will have an additional day to reach its destination. These savings can be realized through the use of less costly modes of transportation, additional use of hub-and-spoke mail consolidation network design, and additional load balancing for the mail processing equipment. What do you think? Can this model balance the need to be financially viable while meeting the needs of the public? This topic is hosted by the OIG’s Risk Analysis Research Center (RARC).
  • on Jul 19th, 2010 in Ideas Worth Exploring | 29 comments
    UPS and FedEx frequently attempt residential deliveries when customers are not home. After a series of failed delivery attempts, these companies return the packages to their local distribution centers, forcing customers to travel to these remote locations to collect their packages. What if the Postal Service offered residential customers a service allowing them to use their local Post Office™ as an alternate delivery address? A delivery company would do its delivery scan at the Post Office and send an e-mail or text message to a customer telling him or her that a package is available. The customer could either pick up the package or have the Postal Service deliver it to his or her home on a specified day. The Postal Service could charge the customer a per-package or periodic (monthly or yearly) fee, or the delivery company could offer this service free of charge. In the latter case, the Postal Service could charge the delivery company, and the customer ordering a product to be shipped via UPS or FedEx could specify whether he or she wants the product delivered to a designated Post Office after the first, second, or third home delivery attempt. Post Offices would need space to store packages until customers pick up their packages or the Postal Service delivers them, so some Post Offices might be incapable of offering this service. Since this new service would most likely be considered a postal product, legal constraints should be limited. However, questions about access to postal facilities and security need to be addressed when exploring this opportunity. This topic is hosted by the OIG’s Risk Analysis Research Center (RARC).
  • on Jun 18th, 2010 in Mail Processing & Transportation | 41 comments
    The U.S. Postal Service’s current fleet of more than 219,000 vehicles includes approximately 146,000 delivery vehicles, most of which are long-life vehicles (LLVs). The first LLVs were produced in 1987, and they average about 10 miles per gallon. The vehicles are right-hand drive to accommodate drivers delivering numerous mailpieces to curbside mailboxes. These iconic right-hand drive delivery trucks are nearing the end of a 24-year life cycle and are costly to maintain. In a recent audit, we noted that it cost the Postal Service about $524 million to fix the LLVs in fiscal year 2009. More than 40,000 trucks required more than $3,500 each in maintenance and another 19,000 of these required an average of $5,600 in repairs consecutively in 2008 and 2009. At this rate, for the high maintenance segment of the fleet, repairs in the next eight years will cost $342 million more than it would to buy new trucks. Considering the growing costs of maintaining this unique but aging fleet, what are your thoughts on a cost-effective, but practical replacement delivery vehicle fleet? To read the full report go to http://www.uspsoig.gov/foia_files/DA-AR-10-005.pdf.
     
    The Office of Audit Engineering & Facilities team is hosting this topic.

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