• on Jan 5th, 2015 in OIG | 17 comments

    The year 2014 was certainly historic on the postal and logistics front. Alibaba entered the U.S. market with a bang, setting a record with the largest ever U.S. initial public offering. For the first time ever, non-mail revenues exceeded mail revenues for postal administrations around the world. Shippers braced for the full effect of dimensional weight pricing. And the U.S. Postal Service added its name to the growing list of agencies and companies to suffer a data breach.

    All in all, quite an eventful year. OIG staff sifted through the news and put together a top 10 list of postal stories, in reverse order of impact. Share your thoughts and take our poll to vote for your top story.

    10. Staples Taps Out – Under pressure from labor groups, Staples and the Postal Service ended a pilot program to set up mini-post offices in stores. Instead, the 82 Staples pilot locations transitioned into the Postal Service’s long-established Approved Shipper Program, which offers some postal products alongside those of other carriers.

    9. Open Sesame! – China’s biggest e-commerce company Alibaba set a record for the largest U.S. initial public offering ever, raising $25 billion. Alibaba’s CEO said the company plans “aggressive expansion” in the U.S. With any luck, the Postal Service will figure out how to partner with Alibaba too.

    8. Dim Weighting on Shippers – FedEx and UPS announced plans to price all ground parcels based on how much space they take up during transport, a concept known as dimensional weight, or dim weight, pricing. Analysts predict this change will result in the most dramatic rate-spike for shippers in decades. Meanwhile, the Postal Service bucked the trend and lowered most commercial Priority Mail prices in 2014, a move aimed at gaining commercial customers.

    7. A Capital Idea – For the first time in years, the Postal Service has funds to invest in capital projects. Helped by the exigent price increase in January 2014, the Postal Service ended the fiscal year with $1.4 billion in “controllable” income and said it has about $2 billion for capital investment.  

    6. Postal Banking Gets Fresh Look – A raft of media coverage of an OIG paper on postal financial services energizes a lively public policy debate, including a slew of conferences, and puts the idea of postal banking on the menu of possible reforms.

    5. Invasion of the Last Mile – Last mile delivery has gotten crowded with retail giants, such as Walmart and Nordstrom, trying their hands at same-day delivery and/or experimenting with crowdshipping. And smaller players are providing niche delivery services, such as Peapod for grocery delivery or Deliv that shuttles goods from shopping malls to customers.

    4. Amazon Eyes World Domination – The giant e-commerce provider is moving into all aspects of the supply chain and beyond, opening warehouses and distribution centers, offering same-day delivery, testing drones, using bikes, providing cloud services, and after-sales support services. Amazon is also a valuable partner of the Postal Service, collaborating on Sunday delivery and the new grocery delivery test.

    3. New Champion of the World – Non-mail revenues now exceed mail revenues for postal organizations around the world, according to Accenture’s annual report on high-performing posts. This shift indicates how important parcels and other diversified products - representing 52 percent of posts' total revenues - have become to posts.

    2. Madame Postmaster General – Postal Service Chief Operating Officer Megan Brennan is named to succeed retiring Postmaster General Patrick Donahoe. Brennan will be the first female PMG in the Postal Service’s 240-year history.

    1. Hack Attack – The Postal Service joins the growing list of government agencies and corporations to experience a data breach and the repercussions that come with it, including a congressional hearing, customer and employee concern, and some corporate soul-searching. There were almost 61,000 cyber attacks and security breaches across the entire federal government last year, according to a recent White House report. 

  • on Dec 29th, 2014 in Ideas Worth Exploring | 9 comments

    With 1 billion smartphones shipped in 2013, it’s safe to say mobile devices are the future of shopping, banking, and transactions – if not everything. Retailers and technology companies certainly agree, as they race to provide consumers with the ideal mobile payment system.

    Before the holidays, Apple unveiled Apple Pay, a wireless payment system. Thanks to near-field communication technology, Apple Pay lets owners of the newest Apple phones and products pay for goods by scanning their phones on a payment terminal. The Apple Pay account links to a customer’s credit or debit card.

    The company has teamed up with a number of major credit card companies and banks, and therein lies the first potential limitation to the system’s success. Users must have a debit or credit card with one of the approved partners. And they must own a newer Apple device.

    Moreover, some retailers aren’t accepting Apple Pay, including CVS and Rite Aid. Why? Possibly because they – along with Target, Walmart, and others – are developing their own mobile wallet and payment system that would avoid swipe fees and other transaction fees retailers pay to credit card companies. Google Wallet is another option in the mobile payment market, but it, too, only works on newer devices and users still need to link the app to a credit card. This might just be the biggest obstacle of all – developing a mobile wallet that offers consumers more value and ease than just pulling out a credit card.

    Finally, security of data and access to consumer data remain key elements. Do mobile payment solutions protect a consumer’s bank account and credit data? And who has access to the valuable consumer data?

    Still, experts expect mobile payment systems to eventually flourish. Indeed, The Guardian recently suggested the Postal Service “could serve as the backbone” for a new payment system by incorporating a mobile payment app into a basic financial services offering.

    What do you think? Is there a role for the Postal Service in mobile payment apps? Or is this an area best served by the private sector? 

  • on Dec 22nd, 2014 in OIG | 1 comment

     

    Pushing the Envelope wishes our readers a joyful holiday season and a prosperous new year. We will take a break this week, but we encourage you to read over the past year’s blogs and let us know what you think on any of the wide range of topics we covered in 2014. We post comments as they come in, even if you comment on a blog that ran years ago.

    On January 5 we will share our annual list of the Top 10 Postal Stories of the Year – one of our most popular blogs. As always, we look forward to your comments and insights. 

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