Postal Affairs Blog

During a press conference on September 15, 2011, the United States Postal Service® (USPS®) announced plans to greatly reduce its current network of processing facilities. The number of processing facilities could be cut by as much as half, which equates to approximately 250 facilities. This would result in a 50% reduction of mail processing equipment and a possible reduction in workforce of up to 35,000 employees.

This move would save the USPS approximately $3 billion per year. The USPS is experiencing substantial drops in mail volume and revenue, and has been implementing a number of cost-cutting measures. Postmaster General Pat Donahoe cited in the September 15, 2011 press release, “Since 2006, we have closed 186 facilities, removed more than 1,500 pieces of mail processing equipment, decreased employee complement by more than 110,000 through attrition and reduced costs by $12 billion.”

Making these types of reductions would obviously have an impact on the level of service, so the USPS is also proposing to adjust the First-Class Mail® delivery standards from the current 1-3 day range to 2 to 3 days. The USPS published a Federal Register Notice on September 15, 2011, detailing the plans for the adjustment in the delivery standards.

Donahoe also noted during the press conference that this move is based strictly on the need to cut costs in the current financially challenging period the USPS is facing, and has no reflection on the dedicated USPS employees commitment to service.

Stay tuned for further developments regarding this announcement. This process will require a great deal of study and will undoubtedly become politically charged as members of Congress try to save postal facilities (and jobs!) located in their districts.

For all the details, visit the new USPS web page  introduced just for this topic.

At the recent MTAC meetings, the Postal Service announced they would be withdrawing the proposed changes to Move Update standards published in the July 12, 2011 Federal Register.

According to the formal announcement in a DMM Advisory issued yesterday, 8/29/11, the content of the proposed rule changes will be ”significantly revised”.  Also announced was that, based on industry feedback, the Moved Left No Address and PO Box Closed, No Forwarding Order (MLNA/BCNO) portions will be completely removed.  

The Postal Service expects that an entirely new proposed rule will be issued in the future.

If you wish to subscribe to the DMM Advisory, send an e-mail to dmmadvisory@usps.com. Type “subscribe” in the subject line.

This week at the Mailers Technical Advisory Committee (MTAC) meetings, the USPS announced that due to the ever-increasing decline in First-Class Mail volumes – and since their processing and distribution network was built around First-Class Mail – they plan to undertake another network re-alignment (I say “another” because they just re-aligned into the NDC structure) and drastically reduce the number of processing facilities from the current 508 to less than 200.  The Postal Service wants the re-alignment to begin in the February/March 2012 timeframe – and to be complete by the end of calendar year 2012.

Yes.  That’s right. Nothing written above is a typo. The Postal Service wants to eliminate over 300 processing facilities in the course of 9 – 10 months during 2012.  Welcome to the biggest “what the …?!?!” moment of MTAC this week.  Oh, I would also be remiss if I did not mention that they announced that due to this re-alignment, they see the First-Class overnight service standard disappearing, too.

Now, I do have to say that there are a number of very good reasons for this, including achieving tremendous cost reductions and improved efficiencies in the use of their automation machines (there are a lot of DPS machines that are currently only being used 5 or so hours a day – this number should be up around 20 hours a day). 

There is a lot more to come from this, and all the industry publications will be chock-full of this information.  But, check back here, too!

There isn’t a better time to start paying attention to what’s going on with the USPS than right now!

- Wallace Vingelis  (wvingelis@windowbook.com)

Mailing industry leaders met with USPS PMG Pat Donahoe this morning where he announced that the Postal Service plans to file an inflation-based price increase request this afternoon.  The proposed implementation date will be April 17, 2011. 

They will seek an overall increase of 1.741% increase.

First-Class Mail will see an overall increase of 1.7%, but the $0.44 Forever stamp will remain unchanged.

Standard Mail will also see a 1.7% increase.  Letters will go up by 1.8%.  Flats will go up 0.8%.  The big hit in Standard are Parcels and NFMs, which will go up 11.3%.

USPS officials also announced that the May 2011 implementation date for switching to Intelligent Mail barcodes to qualify for automation rates is being pushed back, however, no new date has been announced yet.

More to follow after the filing!

Wallace Vingelis

Vice President, Business Development & Marketing

Window Book, Inc.                

Phone:  (617) 395-4569

Fax:        (617) 395-5969

email:    wvingelis@windowbook.com

URL:       www.windowbook.com

There was a meeting of the MTAC 135 Workgroup today to discuss the feedback from USPS Engineering on the D&R (Dispatch & Routing) tags. (rewind a few weeks –> mailers had requested some additional white space be allocated on the D&R tags to allow them some room for “mailer information” – Engineering’s first response was “no – we don’t see a business reason for it” – the industry said “it’s not YOUR business need – it’s OURS” -> fast forward to now)  Engineering now says they can accommodate either a longer or wider tag, but the industry has to make a decision on which because it can’t support both.  When that decision is made by the industry, Engineering will work on and publish specs detailing where the mailer info white-space is.  (btw, rumor has it than an internal USPS mock-up document showed the mailer info at the bottom of the tag)

The USPS will first contact the tag and print vendors to see what they can support (longer or wider or either) – then they will survey the mailers.  More info to follow as it becomes available.

A meeting attendee asked if the USPS will change THEIR stock to accommodate the new sized tags (when in use) to fully cover the mailer’s tag if there is the need for an “overlay”.

The USPS responded that they will need to look into how to accomodate this – just as the industry will – and they will let us know.

Wallace Vingelis

Director, Postal Industry Practice

Window Book, Inc.                

Phone:  (617) 395-4569

email:    wvingelis@windowbook.com