• on May 1st, 2015 in Mail Processing & Transportation | 0 comments

    Here’s the good news: Mailers accept and support the U.S. Postal Service’s Seamless Acceptance (SA) program. And here’s the bad news: Implementing the program hasn’t been very seamless.

    Ongoing data integrity problems, among other concerns, have delayed full implementation of the program. We found evidence of inaccuracy in the data and mailers raised similar concerns, prompting them to ignore the data, according to our recent audit report.

    Not the most auspicious start to a program designed to increase the efficiency of commercial mail entry, verification, and payment. Still, everyone involved wants the program to succeed. SA is expected to make mail acceptance faster and less complex, standardize the acceptance and verification process, and allow for a trend-based quality measurement system.

    Seamless Acceptance uses electronic documentation from a commercial mailer, intelligent mail barcodes, and various scanning devices to verify that the letter and flat mail a mailer is entering meets the Postal Service’s acceptance thresholds and that proper postage is collected. Twenty-nine major mailers have volunteered to participate in SA, tendering about 1.7 billion mailpieces each month. Another 288 mailers volunteered to participate in a preparatory phase of the program known as Seamless Parallel, which helps introduce mailers to SA.

    Our recent audit report noted that while the Postal Service has reported progress in implementing SA, delays continue due to ongoing data integrity issues, as well as customer service and communications hurdles. The Postal Service’s initial goal was to have the full SA program in place by last September. But a series of delays has pushed that date back to July 2015. Notably, problems remain with the scorecard data provided to mailers; postal staff members have limited access to relevant reports and data; and there is inconsistent communication between the Postal Service and participating mailers.

    If you are a commercial mailer currently participating in SA, what are you seeing in terms of data quality, customer service, and communication? If you are not a current participant, are you interested in joining the SA program? If not, what is holding you back?

  • on Mar 16th, 2015 in Mail Processing & Transportation | 1 comment

    This is the second blog in our two-part series on sustainability. Last week’s blog, Green Scene, focused on recycling efforts.

    When do growth and reduction go hand-in-hand? When the world’s posts are trying to grow their business but reduce their carbon footprint.

    The 25 national postal operators that make up the International Post Corporation (IPC) have made great strides toward achieving their carbon dioxide emission reduction goals, but they hit a bump in 2013 and 2014. A coalition of the world’s industrialized posts, the IPC is aiming to cut carbon dioxide emissions by 20 percent by 2020. Half of the IPC members have already reached the target. But last year marked the first increase in emissions from the use of heating and transport fuel for the group as a whole since the IPC environmental measurement program began in 2009.

    One reason for the backsliding is actually a good problem. The global growth in e-commerce, which has boosted the posts’ number of parcel deliveries, is making emission reduction targets more challenging. Especially harsh winters in some countries and a big increase in size in one of the operator’s delivery networks have also contributed to the posts’ higher fuel consumption.

    IPC officials are stressing the importance of switching to renewable energy, either self-generated or purchased, wherever possible.

    The U.S. Postal Service is one of the 25 posts taking part in the IPC Environmental Measurement and Monitoring Program. It’s also one of the posts that saw its transportation fuel use increase. In its 2014 Sustainability Report, the Postal Service notes that “an aging [postal vehicle] fleet and the need to service more delivery points are pushing our fuel demand upward.” Still, the Postal Service must continue its efforts to manage its fuel resources as efficiently as possible, for both its own fleet and its contracting vehicles. (Our 2014 audit report offered recommendations on encouraging fuel efficient practices in highway contract routes.) This should get easier in the next couple of years as the Postal Service replaces its long-life vehicle fleet. This summer the Postal Service will select vendors to build new vehicle prototypes and it will award a contract of up to $6.3 billion over several years beginning in 2017.

    With continued parcel growth expected, how can the world’s posts meet the demands of customers while reducing their carbon footprints? What technologies might benefit the Postal Service specifically? 

  • on Mar 2nd, 2015 in Mail Processing & Transportation | 5 comments

    If you’re a shipper, you may have noticed your fuel surcharge fees aren’t going down in step with the declining price of oil. That’s because both FedEx and UPS tie their fuel surcharges to the price of diesel, which hasn’t dropped as far or as fast as gasoline prices. Furthermore, both shipping giants recently adjusted how they calculate fuel surcharges, resulting in surcharges that won’t drop as much as they would have under the previous calculation. In some cases, fuel surcharges are even going up.

    Fuel surcharges are common in the transport industry, from taxis and airlines to moving and delivery companies. Many of these industries instituted fuel surcharges to smooth out costs when fuel prices were skyrocketing. But in times of low fuel prices, like now, customers see these surcharges as a blatant money-grab.

    Right about now, you may be noting the U.S. Postal Service doesn’t have a fuel surcharge. It also didn’t go all in on dimensional weight pricing (See our previous blog). And it’s not likely to chase the next big thing in pricing: “surge” or “peak” pricing. For the 2015 holiday season, UPS said it plans to follow the Uber model and hit shippers with “peak” prices on its busiest days. This comes after UPS said it experienced higher-than-anticipated 2014 peak season expenses. FedEx is expected to follow suit. For consumers, this could mean the end of free shipping, at least on last-minute orders around the holidays.

    So, the Postal Service might look even more attractive these days with its relatively straightforward, consistent pricing. Of course, the Postal Service isn’t a public company, so it’s not under the same pressure to deliver profits as UPS and FedEx are. But customers are not too interested in the whys and wherefores – they just want low-priced, reliable, fast delivery.

    Do you think the Postal Service is well-positioned to lure away commercial package business from FedEx and UPS? Does the lack of a fuel surcharge put the Postal Service at any kind of a competitive disadvantage? Or is it only advantageous? Do you see the Uber surge or peak pricing model getting a foothold in other industries? 

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