USPS Financial Stability: Expediting The Process To Pay The Bills
The recent MTAC (Mailer's Technical Advisory Committee) meetings in Washington DC once again spoke of the declining revenues and seemingly impossible barriers to returning to postal financial stability.
The Postal Service has a new leadership team in place led by Postmaster General Pat Donahoe that wants to find ways to speed up the process of getting mail delivered and at the same time find enough costs to cut to return to the black ink side of the cashbook.
Some of the hurdles include:
- The continuing decline of First-Class Mail volume
- Growth of the digital market
- Annual payout for future retiree benefits
- The loss of overpayments to the Civil Service Retirement system
- Being mired down in a sometimes adverse and often sluggish Congress
The first two items are indicative of future trends in moving forward and are best left for another day for potential, short-term, resolution. The next two are all sitting in various stages of review by the 112th Congress with a couple of bills proposed to provide relief including the 2011 budget proposal.
The last and toughest is to change the philosophy of deeming it "snail mail" and being comfortable with the idea that the Postal Service is here to stay no matter what happens
It will but at what cost?
Aggressive management by the Postal Service, coupled with targeted cuts in personnel and infrastructure are a way of addressing the need for reducing losses but do not generate new revenue. The danger is that these cuts will affect service, which drives the ability to generate new volume and increase revenue.
Just one example is the loss of services that may happen if Saturday delivery is eliminated. Can the savings justify the service changes, particularly for daily and weekly Periodicals titles and for date specific sales circulars and catalogs?
Time is of the essence! Answers need to be found that help the mailer and the Postal Service or one thing is certain: On Sept. 30, the Postal Service will default on its bills. Where we go from there is a big, big, concern.
Ed Mayhew worked for the Postal Service for 37 years, becoming one of the most recognized experts on periodicals mail in the country. Ed was a part of the Rates and Classification Service Center (RCSC), ending his career as a Classification Specialist in the New Pricing and Classification Service Center in New York City. He has written rulings, instructions and articles for postal publications, appeared as an expert witness in court, a rebuttal witness for the Postal service at the Postal Rate Commission, co-authored postal handbooks and applications, and was the RCSC coordinator for six postage rate cases.
He is the 2002 winner of the Angelo R. Venizian award for contributions to the publishing industry, the first postal winner of that award in its history.
Ed has made training videos appearing on radio and TV, speaks at numerous seminars and is an 11-time top National Postal Forum speaker. He is founder and president of consultancy Eddie Mayhew’s Classification Station. Contact Ed at 973-462-5662, E-Mail at firstname.lastname@example.org or Twitter @eddiemclass.