Mail Fail: Time to Overhaul the USPS?

The United States Postal Service is, unfortunately, in an abysmal financial state. The USPS is on track to post $6 to $12 billion in losses...

The United States Postal Service is, unfortunately, in an abysmal financial state. The USPS is on track to post $6 to $12 billion in losses this year-it's approaching its $15 billion credit limit with the government-and mail volume is plummeting. Business will only get worse as more people start paying their bills, sending personal missives, and filing their taxes online.So how can the postal service survive? An editorial in the Washington Post today suggests it become a real business and start innovating, like Swiss Post:

"Europe's increasingly privatized mail services offer exciting examples of postal possibilities in the 21st century. They are leaner and greener than the U.S. service because they work with, not against, the Internet. Switzerland's Swiss Post, for example, employs green technology, providing customers with secure, address-linked online mailboxes where they can view scanned images of their mail and decide whether to virtually ‘open' it, discard it or have it physically mailed to them. This system has greatly increased efficiency, promoted recycling and decreased junk mail.

Such are the steps the U.S. Postal Service might take if it were a real company and not a hybrid hamstrung by a large and heavily unionized workforce, congressional management, and an antiquated business model."

Providing an online mailbox, like Swiss Post, would lower costs and waste and would be much more pleasant for customers. The USPS might also want to focus on those shipping services that are likely to see an increase thanks to the internet: parcels! Ebay, Etsy, Amazon, and all the other online purveyors of retail stuff will still have to send you their goods for the foreseeable future.

But there's no hope that volumes of First-Class Mail-the biggest revenue source for the USPS-will ever rebound. And the USPS is a monster by every measure when compared with FedEx and other delivery services (see our Transparency on the comparison). There's probably a pretty big scaling down that should happen as well.


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