• on Dec 31st, 2012 in OIG | 4 comments
    The Postal Service faced its own fiscal cliff in 2012 while the larger mailing industry continued to press for reform and innovation. But don’t count mail out just yet. A strong election season reminded many Americans that mail still matters, even in the digital age. And in Europe, one postal operator didn’t let 500 years of history stand in the way of reinventing itself. Looking over the headlines, the staff at the Office of Inspector General has pulled together the list below of the top 10 postal stories for 2012. After you read them, vote for your top story of the year, or let us know if we missed one. 10. Pitfalls of Sponsorship – The U.S. Anti-Doping Agency strips cycling legend Lance Armstrong of his seven Tour de France titles after accusing him of illegal doping while on the U.S. Postal Service team. 9. Sound as a Pound – Royal Mail positions itself for privatization after ending price controls, shifting its pension liability to the government, and earning a profit. 8. Regulatory Fireworks – The Postal Regulatory Commission approves a controversial and newspaper industry-opposed negotiated service agreement with Valassis and remands a portion of the Postal Service’s annual price increase, saying it ignored previous Commission orders. 7. A Vote for Election Mail – Direct mail still matters in politics. Election mail postage surged over $400 million as parties and politicians used mail to target their messages in contentious national and local elections. 6. Default This Year; Reform Next Year – The Postal Service defaults on two prefunding payments totaling $11.1 billion to the Retiree Health Benefits Fund. Lawmakers ready for a postal reform bill in the new Congress. 5. Terminator 2012: Rise of the Tablets, (Further) Decline of Print – Coincidence or not? Venerable publications, such as Newsweek and the Times Picayune newspaper, abandon or reduce their print editions, while the number of tablet owners doubled in the past year and reached 19 percent of adults. 4. Shrink to Fit – The Postal Service’s 5-year business plan calls for cutting costs by $20 billion through workforce reduction, consolidation of facilities, and elimination of Saturday delivery. In initial action, the Postal Service compromised and reduced hours at rural post offices rather than closing them and pushed back its plan to eliminate overnight delivery of First-Class Mail. 3. Postcards from the Edge – The Postal Service reaches its statutory borrowing limit of $15 billion for the first time ever and warned that it could run out of cash by October 2013, barring any significant action. 2. Brand Damage – Steady stream of bad news keeps the Postal Service in the news and threatens to hurt its brand, which could prove especially harmful as it reinvents its business model for the digital age. 1. Parcels are the New Letters – Same-day delivery trials by eBay and the Postal Service, the growth in parcel lockers, and the efforts of traditional brick-and-mortar powerhouse Wal-Mart to increase its online presence indicate a very bright future for packages.
  • on Nov 28th, 2011 in Pricing & Rates | 14 comments
    Have you ever heard of Alaska Bypass? It’s a service the U.S. Postal Service offers only in Alaska, allowing shippers to send shrink-wrapped pallets of goods at Parcel Post rates using private airlines. The Postal Service pays airlines to carry the goods to rural Alaskan communities by delivering these goods directly to the stores located in rural areas. The shippers effectively and entirely “bypass” the Postal Service’s delivery network. The Postal Service has to pay the airlines much more than it receives in postage for this program. In FY 2010, the Postal Service lost $73 million on Alaska Bypass. In addition, the people receiving the shipments are usually retail merchants, because the orders must be at least 1,000 pounds. The Postal Service doesn’t provide this kind of service for retailers anywhere else in the country. Alaska Bypass began when it was much more difficult to get goods to rural Alaskans than it is today. There are even some that say it no longer seems to fit with the Postal Service’s mission. The Office of Inspector General Risk Analysis Research Center has developed a white paper, Alaska Bypass: Beyond Its Original Purpose, which outlines the history of the program and the shift away from its original purpose. The paper offers various options to improve the program. Should the Postal Service continue to pay for sending large shipments of goods to retailers and be permitted to charge the shippers more for this service? Should the 1,000-pound minimum order requirement, targeted to retailers, be eliminated in order to extend the benefit directly to consumers shopping online? What do you think? Click here to read the white paper and we invite you to share your thoughts about this program on our blog. This blog is hosted by the OIG’s Risk Analysis Research Center.
  • on Aug 15th, 2011 in Products & Services | 18 comments
    In today’s world we have the opportunity to do just about anything with just the click of a mouse and a few key strokes. Recent studies show online retail sales continuing to grow despite the economic slowdown and decline of overall retail sales. A previous blog, Could Radio Frequency Identification Make the U.S. Postal Service the Premier Delivery System, stated, “Last year Americans spent $155.2 billion shopping online. This year Americans are projected to spend more than $190 billion.” Purchases made online have to be shipped and this provides a great opportunity for the Postal Service to increase parcel delivery service. The Postal Service delivers almost half the world’s mail and more than 171 billion pieces annually, of this amount, roughly 3 billion are packages (Source: 2010 Report on Form 10-K, United States Postal Service). In addition, the Postal Service is often the last mile option for delivering FedEx, UPS and DHL packages. In 2007, if given a choice, 46 percent of consumers would select the Postal Service to deliver their packages.(Source:Package Delivery Study conducted by comScore, March 2007.) The Postal Service has received several ideas for improving its parcel delivery service. Many suggest the Postal Service could be more competitive if it offered an improved track and trace and confirmation system. Other suggestions include reliable on-time delivery, increased speed of service, and a better loss and damage policy. This blog is hosted by the OIG’s Sales and Service Team.

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