The Upside: The USPS’ Consolidation Plan Means More Reliability, Security and Affordability

The start of 2012 has been a great one! With a strong shipping season this past holiday, and a smooth price change transition, I’m excited to see all of the changes the U.S. Postal Service is making to increase its competitiveness in the Shipping Services industry. With the decline in First-Class Mail, it’s been questioned whether the USPS would “make it”, but I’m seeing that they’re not only surviving, but thriving.

The downside to the significant decline in First-Class Mail is that the USPS had to seriously evaluate their operating costs. This past week, the USPS announced the results of their Area Mail Processing Study, which was conducted in an effort to reduce these operating costs. The study showed that the USPS has a large amount of excess capacity within its network, and there is much opportunity for consolidation since those facilities are directly related to processing First-Class Mail and were sized for the old First-Class Mail volumes. Specifically, of the 264 processing facilities that they studied, 35 will remain open for now, 233 will be consolidated (all or in part), and 6 are on hold for further evaluation.

While these results point toward major changes in the future within the USPS, the implementation of these changes rests upon the decision of the U.S. Senate regarding a proposal to revise existing service standards. The USPS has committed to not close or consolidate any postal facilities prior to May 15, 2012, and there will be no major consolidations during the fall mailing season or during the election mailing period. They are also committed to being very transparent about the changes to its more than 139 million residential customers – proof that they will do everything they can to make this transition as smooth as possible.

The fate of First-Class Mail is concerning, yes, but I’m encouraged that the USPS is making strides to keep up with the ever changing business economy. With the rise of businesses using shipping services, and the global surge in eCommerce activities there is an incredible opportunity here. The USPS recognizes this opportunity for growth and improvement, and is continuing to pour resources into providing better logistical solutions for its business customers.

How are they doing this? Here’s just one example: The USPS is continuing to improve its tracking system, with the goal of providing up to 13 scans from the time a package is accepted to the time a package has been delivered. Tracking improvements are already underway, and we have many examples of pieces getting up to 10 scans. The USPS expects to have additional tracking system improvements in place by 2013, including real time scanning at the time of package delivery.

Here at DYMO Endicia, we continue to be a proud partner of the USPS, and look forward to continually providing innovations to help take the USPS to the next level. As the USPS continues to make changes and improvements in the future, we are committed to confidently support them, and strive to make improvements in our services as well.

For more news and tips, check out our FedEx vs. UPS vs. USPS shipping rates comparison page.