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Audit Reports

May
27
2015
Report Number:
NO-AR-15-006
Report Type:
Audit Reports
Category: Delivery / Mail Processing

Package Processing Performance During the December 2014 Peak Holiday Season

Background

Strong consumer demand for goods purchased over the Internet has driven growth in package volume in an otherwise declining mail market. In its 2012 Five-Year Business Plan, the U.S. Postal Service projects that package volume, which was 3.5 billion in fiscal year 2012, will grow by 5 to 6 percent per year through 2017. The Postal Service is busiest in December during the peak holiday season.

The Postal Service processed a record workload of 865.4 million packages during the December 2014 peak holiday season. Our objective was to assess the Postal Service’s package processing performance during the December 2014 peak holiday season.

What The OIG Found

Overall, the Postal Service’s package processing improved during the December 2014 peak holiday season. Specifically, total workload increased by 88.2 million packages while delayed packages decreased by 1.8 million as compared to the December 2013 peak holiday season. In addition, service scores for packages increased in six of the nine package categories. While the Postal Service was successful during the December 2014 peak holiday season, opportunities exist for improvement. 

Through observations and interviews at eight facilities, we identified three factors that contributed to the mail processing package delays:

■ The processing of commingled Priority Mail® and First-Class Mail packages which can cause excess processing machine run time and delayed transportation of Priority Mail packages, which have more timely delivery requirements.

■ The delayed deployment of a package processing machine during the peak holiday season resulting in possible loss of additional mail processing machine capacity. Also, some package processing machines were not fully utilized, which negatively impacted package processing.

■ The timing and prioritization of hiring temporary employees during the peak period could be improved.

What The OIG Recommended

We recommended management enforce the segregation of Priority from First-Class Mail® for commercial mailers and post offices. We also recommended management ensure the timely installation of machines if needed for the peak holiday season; better utilize feed systems on package sorting machines; and improve the timing and prioritization of hiring temporary employees for the next peak holiday season. Highlights Overall, the Postal Service’s package processing improved during the December 2014 peak holiday season. While the Postal Service was successful during the December 2014 peak holiday season, opportunities exist for improvement. 

Report Recommendations

# Recommendation Status Value Management Response OIG Response USPS Proposed Resolution
1

R - 1 -- Enforce the segregation of Priority from First-Class Mail® for commercial mailers and post offices.

Closed $0 Agree
2

R - 2 -- Ensure the timely installation of machines if needed for the peak holiday season.

Closed $0 Agree
3

R - 3 -- Enhance the utilization of the automated parcel and bundle sorter and automated package processing sorter feed systems to continuously convey packages.

Closed $0 Agree
4

R - 4 -- Improve the timing and prioritization of hiring temporary employees for the next peak holiday season.

Closed $0 Agree