Mailing/Fulfillment - Postal Trends

February may be a short month, but it’s already a record breaker for one type of downsizing at the U.S. Postal Service. USPS has launched Area Mail Processing studies this month that could lead to the closing or significant downsizing of 20 processing and distribution centers. The previous record month for such new AMP studies was September 2010, with 13.

The Postal Service has also approved six AMP consolidations this month, deciding to move work from facilities in Daytona Beach, FL; Lufkin, TX; Muncie, IN; Wichita Falls, TX; and Zanesville, OH to those in nearby cities.

The U.S. Postal Service should invest to position itself as a “de facto national service provider” at the heart of digital communications in the United States, according to a new report from the Office of the Inspector General (OIG). The first in a series of reports from the OIG’s Risk Analysis Research Center on how the USPS should be engaging with an increasingly digital U.S. population, the study says the USPS actually has a major advantage over private corporations in pursuing online opportunities.

While the OIG held back from setting out a digital communications strategy for the USPS

President Obama is set to present a special Valentine’s Day gift to the U.S. Postal Service this year, in the form of assistance in his latest budget. The struggling USPS needs to address financial problems that saw it posting an $8.5 billion loss last year, with commentators predicting a $6.5 billion loss this year—and possible insolvency.

But this morning, the chairman of the Postal Regulatory Commission revealed that she had been told by White House officials that some assistance will come in the President’s Budget for the 2012 fiscal year, which is due to be announced later this month.

In the past seven days, the U.S. Postal Service has announced it is considering the closing or downsizing of seven distribution centers as it steps up efforts to shrink its mail-processing network. The latest announcements mean that more than 15 percent of the country's approximately 260 processing and distribution centers are the subject of Area Mail Processing studies, which can lead to work being shifted to facilities in other cities. While the media pay attention to the recent announcement that 2,000 small post offices might close, the less publicized AMPS process could be equally significant for the USPS’s workforce, cost

An article published in the Wall Street Journal earlier this week reported that 2,000 post offices may close, but a USPS spokesman said the situation is not that dire. “The Wall Street Journal didn’t get their vocabulary right,” said Joseph Breckenridge of the USPS. “What they should have said was 2,000 stations and branches.”

He said the difference in a post office and a branch or station is size and retail capability.

Breckenridge said some branches and stations in Alabama would instead undergo Delivery Unit Optimization, a process that will consolidate back room operations and save money.

Don’t be surprised if you start seeing more solicitations for Discover cards showing up in your mailbox. The U.S. Postal Service and Discover Financial Services have reached a deal giving Discover incentives to increase its mail volume during the next three years. The arrangement could set a pattern for deals with other large mailers that, like Discover, are mailing fewer customer statements these days because of online billing.

The Negotiated Service Agreement “is intended to promote new growth in Standard Mail that will help offset the expected decline in DFS’ First-Class Mail volume,” says USPS’ recent filing.

Patrick Donahoe, the 73rd Postmaster General of the United States, is taking control of an organization in fiscal crisis. Donahoe tells Federal News Radio he’s confident the USPS will return to black, but not without cutting back on mail delivery days.

“The loss of first class volume puts a lot of additional cost pressure” on the postal service, said Donahoe. “We eventually will have to go from six to five days from a delivery standpoint to remain in the black.”

Donahoe explained, “our first class volume is dropping at a rate of six percent per year.

House Republicans are tapping two freshmen to lead congressional oversight of the federal workforce and U.S. Postal Service. Reps. Dennis A. Ross (R-Fla.) and Justin Amash (R-Mich.) will serve as chairman and vice chairman of the panel’s subcommittee on the federal workforce, U.S. Postal Service and labor policy, according to aides for committee chairman Darrell Issa (R-Calif.).

Though the Postal Service is seeking serious structural reforms, it is still unclear how far Congress is willing to go to revamp it. USPS lost $8.5 billion in the fiscal year that ended in September and postal executives are seeking passage

The U.S. Postal Service will announce rate increases for most classes of mail, but apparently not for the First-Class stamp, later today, according to a reliable source. Postal officials put the word out today to some mailing associations that rates for the “market-dominant” classes—First-Class, Standard and Periodicals—would rise in mid-April. The average increase for each class is capped at 1.741 percent, based on annual changes in the Consumer Price Index.

A postal official indicated it would keep the price of a First-Class stamp at 44 cents, enabling it to impose higher-than-cap increases on First-Class flats.

With a radical management reorganization, including the break-up of the Intelligent Mail group, new Postmaster General Pat Donahoe showed once again yesterday that he won’t just quietly follow in his predecessor’s footsteps. Exactly what the new structure means is not completely clear, but what is clear is that more change is coming.

“Today's actions and announcements are the beginning of a much larger process that will involve every level of the organization, including the closure of some Districts. As we continue our restructuring, we anticipate that Reduction in Force (RIF) and Voluntary Early Retirement (VER) processes will be initiated