Tuesday, April 21, 2015

Cluster boxes not the answer to Postal Service's financial woes, watchdog report says

One of the proposals by the U.S. Postal Service to save money—the agency lost $5.5 billion in 2014—is to exchange home deliveries for neighborhood cluster boxes that would allow mail carriers to do their jobs more quickly and efficiently, Josh Hicks reports for The Washington Post. "But a new report from the USPS inspector general’s office casts doubt on how much the change would benefit the agency financially."

Mail advertising accounted for 22 percent of the Postal Service's $28 billion in product revenue two years ago, Hicks writes. The watchdog report says that about 10.6 percent of people who receive home mail service read and respond to credit card solicitations, compared to only 3.1 percent of customers with cluster boxes. "With other types of mail advertisements, the findings were 'qualitatively similar to the credit card solicitation results, albeit with less dramatic differences by mode,' according to the report."

"Republican and Democratic lawmakers have pushed for greater use of curbside and cluster mail boxes, but opponents say the Postal Service should focus on new products and services rather than cuts," Hicks writes. "It is unclear whether the Postal Service would truly lose advertising revenue by moving away from the door-delivery model or whether it could make up for the potential loss with cost savings."

1 comment:

Webb Rowan said...

Considering the amount of money and financing that has to go into getting this new system all set up and installed, whatever cost savings the postal services are going to see are going to be far in the future!