USPS Pushing Forward with Service Changes
WASHINGTON, DC—The U.S. Postal Service (USPS) announced it will move forward with its proposal to change service standards. USPS said the move was being taken in response to ongoing financial challenges caused by the dramatic and continual decline in First-Class Mail volume and the resulting revenue loss.
According to the USPS, the size of its current network is dictated by the current overnight transit time in existing service standards. The Postal Service is proposing, through the rulemaking process, to move First-Class Mail to a two- to three-day standard for contiguous U.S. destinations. However, there would be an opportunity for mailers that properly prepare and enter mail at the destination processing facility prior to the day’s critical entry time to have their mail delivered the following delivery day.
The Postal Service is also moving forward with its plan, announced on Sept. 15, 2011, to evaluate 252 out of the current 487 mail processing facilities for possible closure.
The Postal Service will send to the Postal Regulatory Commission (PRC) a request for an advisory opinion regarding service standard changes associated with a significant rationalization of its mail processing network. Shortly thereafter, the USPS will publish a notice in the Federal Register soliciting public comment on the specific proposed changes.
“The U.S. Postal Service must reduce its operating costs by $20 billion by 2015 in order to return to profitability,” said David Williams, vice president, network operations. “The proposed changes to service standards will allow for significant consolidation of the postal network in terms of facilities, processing equipment, vehicles and employee workforce and will generate projected net annual savings of approximately $2.1 billion.”
This is part of the overall savings expected from the network optimization initiative, which is projected to save up to $3 billion by 2015.