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mailroom doldrums

Mail holiday cards early: United States Postal Services slows next-day delivery to combat increasing debt

Seattle's Best Coffee sign
We'll soon see this logo at 15 stores around Dallas-Fort Worth. Photo courtesy of Seattle's Best Coffee
Rendering of Seattle's Best Coffee drive-thru
Rendering of a Seattle's Best Coffee drive-thru. Photo courtesy of Seattle's Best Coffee

Next day delivery through the U.S. Postal Service will soon be a thing of the past as the mail carrier announced Monday they will no longer guarantee arrival of first-class stamped mail within one to three days. The shift comes amid threats of bankruptcy and is part of a broader plan to reduce costs by $20 billion within three years.

In addition to slowing first class delivery, the USPS plans to eliminate all Saturday deliveries, shortening the mail week to just five days. The newest cuts will eliminate $3 billion from the ailing service’s $14.1 billion deficit, closing nearly half of all mail processing centers and removing an additional 28,000 jobs from the nation’s already dismal workforce.

The changes are potentially harmful, as recognized by S&P Capital IQ analyst Jim Corridore in a story by NPR, in which he points out, “Over time, to the extent the customer service experience gets worse, it will only increase the shift away from mail to alternatives. There's almost nothing you can't do online that you can do by mail."  
 
Corridore’s concern is well placed: In a market that is increasingly moving towards the Internet and a youth that mostly refers to physical mail with nostalgia, where does the USPS fit in? Now that delivery will be slowed to two to three days, even some of the baby-boomer hold-outs must be considering the possibility of abandoning physical mail for services like bill payment or during tax season..

Not to say physical mail is obsolete — not by any stretch of the word. Many people, especially those in more rural areas, are dependent on the speedy, reliable delivery of prescription medicine directly to their homes. But with slower service and the loss of an entire business day, some residents might see their shipments delayed an entire week.

And what about businesses that depend on delivering time sensitive packages directly to customer’s residences? Netflix is already struggling to keep its DVD-by-mail service afloat, and an extra day or two added to delivery times is sure to further stunt growth in that portion of the company’s business.
 
Printed publications such as TIME or USA Today that rely on expedient home delivery will surely face higher operating costs insuring the timely arrival of their already “day-late” offerings. If any of these organizations are forced to privatize their shipment method, the USPS stands to lose even more business, and at this stage, it literally cannot afford any revenue loss.

Even though the physical delivery of mail is less relevant now than it was just 50 years ago, shrinking the postal service will effect a much broader portion of the nation than just those who prefer to send a hand written letter over a typed out e-mail. From corporations to citizenry, the impact of these cuts seem to have a more profound effect than just forcing customers to conduct their business online.

It’s impressive to think that for over 40 years, one could send a piece of paper anywhere in the United States and have it arrive the next day for under 50 cents. Now that next day delivery is going away, and with the vast amount of debt still facing the U.S. Postal Service, how much longer can the government viably support the independent agency?
 
It’s disappointing that such a revolutionary, long-standing American tradition might disappear, but with billions of dollars to make up by 2015 and all of the low cost alternatives available, mail appears to be on its last leg.

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The U.S. Postal Service’s full press release can be read here.

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