• on Oct 24th, 2011 in Post Offices & Retail Network | 32 comments
    A Contract Postal Unit (CPU) is a retail postal facility located inside a retail establishment, such as supermarkets, card and gift shops, pharmacies, and colleges. CPUs are operated by the retailer's employees and offer the same basic services available at a regular Post Office. The Village Post Office (VPO) concept was introduced earlier this year and is similar to the CPU in that they are retail postal facilities operated by community businesses. However, they provide limited postal products and services. CPUs and VPOs lower U.S. Postal Service expenses, primarily because they use already existing retail stores. The Postal Service does not have to rent its own store and hire dedicated staff. In fiscal year (FY) 2010, CPUs accounted for 8 percent of the Postal Service’s total retail network. In comparison, Canada has private dealer – operated outlets, which are similar to CPUs and account for more than 39 percent of Canada Posts® retail outlets; Australia has Licensed Post Offices and Community Postal Agencies, which are also similar to CPUs and account for 81 percent of Australia Posts® retail network. Expanding the use of CPUs and VPOs could assist the Postal Service in reducing its physical footprint, lowering expenses, providing more outlets for products and services, and potentially increasing access hours. What do you think? Would a system of CPU and VPOs better serve the current market? Do you have any concerns with the concept? Please share your thoughts and ideas. This topic is hosted by the OIG’s Financial Control Directorate.
  • on Aug 8th, 2011 in Post Offices & Retail Network | 26 comments
    The U.S. Postal Service recently announced that it would study approximately 3,700 postal retail facilities which are candidates for consolidation. Many policymakers and Postal Service customers have expressed concern over the effect these potential consolidations will have on access to postal services and as well as the social life of rural communities where the local post office acted as a gathering point for the community. In an attempt to address some of these concerns, the Postal Service revealed plans to offer its services through authorized third party vendors, including drug stores, grocery stores, and office supply stores. These Village Post Offices (VPO) would be operated by the vendor and sell popular products and services such as stamps and flat-rate packaging. The Postal Service’s primary benefit would be lower labor and facilities maintenance costs from replacing traditional, free-standing post offices with Village Post Offices. There are also potential benefits to consumers. First, postal services could be more conveniently accessed by customers who already patronize the third party vendors. Second, the co-location may actually help to strengthen community ties. Third, the VPOs may be open longer hours. However, there may also be drawbacks to switching from traditional post offices to VPOs. First, the quality and level of service may vary between communities as VPOs would be managed by many different private vendors. In addition, as with any effort involving public-private partnerships, oversight issues may arise. Finally, because VPOs will be operated by private vendors, the role of the post office as a public space may be lost. Are Village Post Offices a viable substitute for tradition postal retail facilities? Can service standards be maintained? Which type of vendors do you believe would be most suitable as a host for a VPO?