Sound familiar???

Postmaster General Louis DeJoy outlines 10-year plan to plug losses and adapt to world with fewer letters, more e-commerce

More packages, higher prices and a longer window to deliver first-class mail underpin the U.S. Postal Service’s plan over the next decade to overhaul the agency’s operations and avoid more than $100 billion in projected losses.

The proposals to be disclosed Tuesday are part of Postmaster General Louis DeJoy’s strategy to improve reliability, modernize operations and financially overhaul the cash-strapped agency. The plan hinges on legislative relief long sought by the Postal Service to ease its financial burdens for retiree benefits as well as spending to build out the network to capitalize on the growth of e-commerce. (See highlights of the plan.)

Mr. DeJoy projects the moves would help the agency break even over the next decade, through a combination of boosting its package business and reducing costs to account for the precipitous decline in mail volumes. The agency has lost money in each of the past 14 years, including a $9.2 billion net loss in its latest fiscal year.

“The biggest change here is that we have a growth plan,” Mr. DeJoy said in an interview.

The plan confronts the opposite courses that two of its key businesses have been on for years. Annual revenue from first-class mail is down more than 36% since 2007. Meanwhile, revenue from packages has nearly tripled during that same period with the explosion in online shopping. Neither trend is expected to stop.

“You can’t chase the mail down,” Mr. DeJoy said. “You have to ride the growth up.”

The Postal Service has long structured its vast network around the sortation centers and truck routes needed to move flat letters. Mr. DeJoy said it has missed out on opportunities to expand its package business with more processing sites and equipment better attuned to moving boxes from one destination to the next. During the pandemic, for instance, the Postal Service’s package arm was strained with the influx of packages, and its growth trailed the industry.

To address the decline in first-class mail, Mr. DeJoy proposes raising rates on first-class mail faster than the Postal Service has been allowed to in the past. Previously, the upper limit was tied to inflation, but the Postal Regulatory Commission last year gave the agency more leeway to raise prices.

“The government has told us to break even, to be self-sustaining,” Ron Bloom, chairman of the Postal Service’s board of governors, said in an interview. “They’ve also told us that the only place you get money is from the sale of your product. The only way that circle squares is if we can charge a little more for our product.”

In tandem with higher prices, the Postal Service will look to change the service standard for first-class mail, allowing it to take up to five days to arrive instead of three. Over the past eight years the Postal Service hasn’t been hitting its target of delivering first-class mail within the window 96% of the time. Widening that service window will also allow the Postal Service to use more lower-cost ground transportation to haul mail across the country instead of paying for costlier air transportation.

Messrs. DeJoy and Bloom said they were committed to continuing mail delivery at six days a week, rejecting some prior proposals that called for reducing delivery days to mend the agency’s finances. Their plan also doesn’t include widespread layoffs or closures of local Post Offices.

POSTAL SERVICE
U.S. Postal Service Seeks Big Service Changes. Here’s What You Need to Know (March 23)
U.S. Postal Service Struggles to Keep Up With Christmas Deliveries (Dec. 22, 2020)
Mail Service Deteriorated After Postmaster General Louis DeJoy’s Arrival, Watchdog Found (Oct. 22, 2020)
USPS to Suspend Changes Until After Election (Aug. 18, 2020)
The proposal will be reviewed by a Congress that has been split along partisan lines and so far unwilling to answer the Postal Service’s calls for relief. Unions representing many of the Postal Service’s more than 640,000 workers are expected to weigh in. So could big users of mail and businesses, including e-commerce giant Amazon.com Inc., AMZN 0.86% that have been lobbying against increases in postal rates.

Mr. DeJoy is a relative newcomer to the Postal Service. The former logistics executive and Republican donor was appointed Postmaster General in May 2020. He came under fire from Democrats last year for poor service levels and operational changes he started ahead of the presidential election. He put changes on hold until after the election.

Mr. Bloom, who in the Obama administration helped engineer the U.S. auto bailout, joined the postal board in August 2019 and was elected chairman in February. He is a former union negotiator and Wall Street banker who in 2011 advised the National Association of Letter Carriers.

Mr. Bloom said he hoped that the plan generated bipartisan support and was evaluated in totality. “Are we going to come together in a bipartisan way and ask, ‘Do we want what’s good for the Postal Service?’ or do we want to play politics?” Mr. Bloom said.

Mr. DeJoy said many of the operational changes could be enacted, while others, including higher prices and new service standards, will require approval from the Postal Regulatory Commission. Although some operational shifts he put in place last summer led to temporary delivery problems, Mr. DeJoy said the agency would be able “to make these moves…without a real hit to service, and pull off our cost objectives also.”

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The Postal Service plans to move more first-class mail and packages by truck instead of by plane, where it relies on third-party carriers such as FedEx Corp. FDX -2.63% , a move it says will save money and improve delivery times.

Shifting more volumes to ground would also improve efficiency by using more space in trailers, the agency says. “We have put way too much of our cubic foot movement up on air,” Mr. DeJoy said, while trucks in the Postal Service’s network are running at around 35% full.

To help handle that load, the Postal Service is rolling out new automated equipment, including about 185 new package sorters. It plans to convert 21 distribution centers that now process marketing mail, periodicals and packages into dedicated regional package-only sites.

The Postal Service will ask Congress to integrate its retiree health plans with Medicare and rescind a requirement that the agency prefund its employee retirement benefits decades out into the future.
Mr. DeJoy’s predecessor had sought similar legislative changes. Despite some bipartisan support, none have advanced in Congress. The retiree changes alone would account for about $58 billion of the $160 billion hole that Mr. DeJoy is seeking to plug over the next decade.

“We’ve been having good conversations with both sides of the aisle and hopefully with this plan, we will get more and more support,” Mr. DeJoy said. “I’m counting on that.”

Mr. DeJoy said some of the initiatives in the plan, which was hashed out over eight months during the pandemic, aren’t too far off from what the Postal Service has sought to enact in previous years but never took on.

“Legacy thinking has kept the Postal Service where it is and not evolving,” Mr. DeJoy said. “This plan is about evolving.”

Write to Paul Ziobro at Paul.Ziobro@wsj.com and Jennifer Smith at jennifer.smith@wsj.com

LINK: https://www.wsj.com/articles/u...ckages-11616509800?m

quote:

In tandem with higher prices, the Postal Service will look to change the service standard for first-class mail, allowing it to take up to five days to arrive instead of three

Sorta changes the very definition of First Class, doesn't it?

that's the ticket

slower and more expensive

what will they think of next??

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yesterday my rural carrier had to leave his USPS van in front of my mailbox, and walk down my driveway because he had a box too big for the mailbox. He said " they won't allow us to back up anymore".

I’ll park this one bit of wisdom into the USPS and jet before it turns to a shitshow....I’ve never had FedEx, DHL or UPS leave unsolicited shit for me to sort through

They could make a lot of money if they sold immunity from junk mail.

How much would you pay to NOT receive junk mail?

For my fellow members of the bar... if First Class mail officially gets a five day window to arrive, will the state and federal court systems be similarly amending the mailbox rule?

Just a thought.

-Rob

quote:

the mailbox rule

Can you explain what you're talking about? I looked it up and still don't understand.

If the USPS raises their prices on packages, they will lose the "final mile" business that they currently get from UPS, Amazon, et. al. Revenue will go down, not up. How about, as a business strategy, improve service (to the point where people actually want to use them), and make sending a package by USPS as easy, fast, and predictable as the commercial package delivery services?

quote:

Originally posted by architect:
If the USPS raises their prices on packages, they will lose the "final mile" business that they currently get from UPS, Amazon, et. al. Revenue will go down, not up. How about, as a business strategy, improve service, and make sending a package by USPS as easy, fast, and predictable as the commercial package delivery services?

Heretic!!!

So instead of trimming services and upping your game, you raise prices and further worsen your level of service? And this is to get back into the game?

Okay, let's say this is akin to increasing the cost of tickets while getting rid of your a-team and playing with your bench team. In hopes of winning the game and getting more fans?

I'm missing something..... I know it. I can feel it. I just can't put my hands on it....

Sounds like they have a winning formula.

It worked for Amtrak.

Steve Lehto of Lehto's Law on YT posted an interesting video on the USPS topic a couple days ago.

His experience is similar to my continual experiences with USPS. Worsening service, "lost" mail, and insane routing. His experience, like mine, is that you can order from another country, pay less, and get it faster. Our system is broken. We should stop feeding broken systems in our country. Let these failed liberal experiments go out of business so the rest of us can get back to work.

Tucson is a particularly fun place to mail a letter.

Suppose I want to mail a letter to my neighbor - 300 feet away.

I put it in my mail box. Its picked up, taken to a station here in town. Rather than sort by zip code and recognize that its a local letter, the USPS in its infinitesimally small wisdom decides thats too much trouble.

So they ship it by truck to Phoenix, where it goes to yet another sorting facility where they recognize the zip code as being a Tucson code, so they package it up and truckm it back to Tucson - probably to the same facility that sent it to Phoenix.

The its sorted and delivered across the street.

Average time

4 days

and you wonder why they're broke and inefficient

quote:

Originally posted by nhtagmember:
Tucson is a particularly fun place to mail a letter.

Suppose I want to mail a letter to my neighbor - 300 feet away.

I put it in my mail box. Its picked up, taken to a station here in town. Rather than sort by zip code and recognize that its a local letter, the USPS in its infinitesimally small wisdom decides thats too much trouble.

So they ship it by truck to Phoenix, where it goes to yet another sorting facility where they recognize the zip code as being a Tucson code, so they package it up and truckm it back to Tucson - probably to the same facility that sent it to Phoenix.

The its sorted and delivered across the street.

Average time

4 days

and you wonder why they're broke and inefficient

USPS shut the Tucson Cherrybell mail processing center in 2014. Used to stay open late some nights.

Reason for closing: save money.

Buggy Whips!

quote:

Originally posted by nhtagmember:
Tucson is a particularly fun place to mail a letter.

Suppose I want to mail a letter to my neighbor - 300 feet away.

I put it in my mail box. Its picked up, taken to a station here in town. Rather than sort by zip code and recognize that its a local letter, the USPS in its infinitesimally small wisdom decides thats too much trouble.

So they ship it by truck to Phoenix, where it goes to yet another sorting facility where they recognize the zip code as being a Tucson code, so they package it up and truckm it back to Tucson - probably to the same facility that sent it to Phoenix.

The its sorted and delivered across the street.

Average time

4 days

and you wonder why they're broke and inefficient

Same thing happened in my smallish hometown. The local PO doesn't sort any local mail anymore. If a letter is mailed to an address in town, it's first shipped 100 miles away to a processing center, then it's shipped 100 miles back to the same PO, where it then goes out for delivery. No joke.
Yeah, that sounds efficient.

quote:

Originally posted by Skull Leader:

quote:

the mailbox rule

Can you explain what you're talking about? I looked it up and still don't understand.

I didn’t see this answered so I’ll try.

If a contract requires you to give notice, or a courts requires a response, by a certain deadline, that notice or response is deemed to be given when it is placed in the U.S. Mail rather than received by the other party.

It is the same as with tax returns. A tax return is considered timely filed if it is mailed (postmarked) by the due date.

This idea isn’t really as relevant with many things being filed these days.

Most contracts I’ve seen, recently, require fax or recognized overnight carrier. Mail has failed.

Hell, charge a dollar per stamp, and only delivery packages on weekends, but go back to 3 days... (some of this might also be the weirdness in the rail system. My grandfather was a postmaster, for awhile - small town, and no one else wanted the job. He didn’t stick to it very long. He said they used to sort mail on the trains... Also probably helped that most business in general was local.)

Actually, a “local mail” stamp/mailbox might be a good idea. I think most people probably are sending mail locally, if they still use it.)