• 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.
  • 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.
  • on Sep 29th, 2010 in Strategy & Public Policy | 7 comments
    The U.S. Postal Service is used to delivering large amounts of mail. Last year, it delivered more than 177 billion pieces. More mail pieces are sent per person in the United States than almost anywhere else in the world. But mail volume has been declining. How will the Postal Service change if volumes continue to fall? Is the Postal Service even financially sustainable at lower volume levels? The Office of Inspector General (OIG) asked the George Mason University School of Public Policy (GMU) to find out. The results of GMU’s work appear in a paper released today on our website. GMU researchers looked at how mail volumes of 150, 125, 100, and 75 billion would affect the Postal Service’s financial position and cost structure. Their results are encouraging. They found that the Postal Service is financially sustainable at volume levels down to 100 billion pieces per year, although price increases above inflation would be needed. The cost structure of the Postal Service would also change at lower volume levels. For example, delivery would account for a much larger share of total costs. GMU researchers also looked at the effect of various cost reduction initiatives and how they would impact the price increases necessary to break even. The paper describes their results and a description of the model they used for their analysis. What do you think? What are the biggest challenges for the Postal Service at lower volume levels? This topic is hosted by the OIG’s Risk Analysis Research Center (RARC).

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