DESPITE A YEAR of record mail volume, postal revenue has fallen way below the U.S. Postal Service’s projections of a $200 million profit for fiscal 1999. There are many factors that might be contributing to this turn of events, some alarming and others no surprise at all.
While mail volume has grown modestly thus far this year, USPS net revenue has hit the skids. The postal service was unprepared to accommodate the change in mail mix that mailers had predicted would result from mail classification reform. Consequently, charges that should have been removed from the system never were, and the opportunity to generate higher revenue by paring postal costs was lost.
What’s Next? So how will the USPS respond to this unfortunate circumstance? Will it renege on its promise of no new rate case before the year 2000?
Fortunately, we now have a postmaster general who appreciates fully the need to keep the promises he makes, even if it means causing his own team to suffer some discomfort. William Henderson told The Washington Post that “the organization has to hunker down…We’ve described this as the postal service not going on a diet, but having a lifestyle change.” Good for him!
And as far as mailers are concerned, this is the only appropriate response.
It wasn’t mailers, after all, who failed to behave as they had predicted. The USPS wanted to change its mail mix to gain additional operating efficiencies, and the postal service’s customers delivered.
Too bad the USPS didn’t believe in its own power to bring about such change. It wasted a fantastic opportunity to show the benefits of increased mailer work-sharing at the very time cutting costs should have been a top postal priority.
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