Postal Service Cuts Saturday Deliveries, But Who Will Be Most Affected?

    February 13, 2013
    Amanda Crum

The USPS has been the topic of much debate over the past couple of years as it reviews its options now that the digital world has seemingly rendered mail service near-obsolete. Though widespread email use has all but eliminated the need to send letters and many people are going paperless in an effort to be green, a lot of people still rely on the post office to deliver bills–especially those who don’t want to give out their banking information online–and package delivery is always a concern.

In an attempt to make things easier for its customers, the Postal Service has even introduced a new service for packages recently that includes giving the customer the ability to pay for and print their own shipping labels at home, then schedule a pick-up using one of the service’s flat-rate boxes. But the agency says it will continue to make packages a priority even as it prepares to end Saturday mail service, scheduled to begin this summer.

Should the Postal Service end Saturday mail delivery? Let us know what you think in the comments.

Packages will still get delivered six days a week, even if regular mail will not. The USPS has been battling Congress for several years now in an effort to get the measure approved, and many are wondering exactly how the agency–which is largely considered quasi-governmental and relies on Congressional approval for all measures–can get away with making the decision for five-day delivery itself.

Apparently, Postmaster General Patrick R. Donahoe has found a loophole in the system involving the fiscal cliff impasse; even though every appropriations bill Congress has passed for the USPS in the past thirty years has included a six-day mail delivery mandate, they have yet to pass the bill for 2013, which is still operating under the “continuing resolution” the federal government is under due to the fiscal cliff. Unless Congress passes a bill mandating six-day delivery by March 27th–which Donahoe knows is extremely unlikely–the USPS is legally allowed to act on its own. The measure comes at a time when polling shows 70% of Americans support cutting Saturday delivery, especially if it saves the agency a projected $2 billion annually as promised. It would also negate the need to hike up stamp prices, an idea which garnered many protests when it was submitted to the public.

“The Postal Service is advancing an important new approach to delivery that reflects the strong growth of our package business and responds to the financial realities resulting from America’s changing mailing habits,” Donahoe said in a statement. “We developed this approach by working with our customers to understand their delivery needs and by identifying creative ways to generate significant cost savings.”

The USPS also acknowledges that this doesn’t mean it won’t need the help of Congress later on, as the agency is not taxpayer-funded. It wants the support of its customers when it comes to changing legislation in the future.

“While the change in the delivery schedule announced today is one of the actions needed to restore the financial health of the Postal Service, legislative change is urgently needed to address matters outside the Postal Service’s control,” reads the statement. “The Postal Service continues to seek legislation to provide it with greater flexibility to control costs and generate new revenue and encourages the 113th Congress to make postal reform legislation an urgent priority. The Postal Service receives no tax dollars for operating expenses and relies on the sale of postage, products and services to fund its operations.”

But despite the growing support the country has shown for the decision, not everyone is happy about it; some companies are worried about the impact the move will have on their business. Those who rely on Saturday mail service to keep customers happy–such as Hallmark–say it could prove to be a bad choice for everyone involved.

Hallmark released a statement about the news on its website:

While we know this option was one of many the USPS has recommended in the past, the Postal Rate Commission believes the cost savings from this move would be less than the postal service estimates, especially if they continue to deliver parcels on Saturday.

In addition, this move does nothing to address the underlying organizational and operational issues that have led to their current financial crisis.

Hallmark continues to believe a reduction in service will not induce customer loyalty and will negatively impact small towns and small businesses that depend on timely, affordable, reliable mail delivery. This move should only be considered once all other cost-saving options are fully explored and acted upon.

Time Warner is another company which could be affected by the loss of a delivery day, as they are the largest magazine publisher in the U.S. Blogger Chris Kotje predicts that magazine editors will be scrambling to meet deadlines in an effort to get their product to the customer in a shorter block of time…meaning increased labor costs.

On the other side of the coin, we have delivery companies like UPS and FedEx, which may well profit from a 5-day delivery system. Even though the USPS is adamant that packages will still be delivered six days a week, there’s always the possibility that some customers might not understand or trust the new schedule and take their business elsewhere. Revenues for both UPS and FedEx are expected to jump up to 5% in the next year.

Finally, there are those companies one would assume might be opposed to the changes but are surprisingly casual about the possibility of no weekend mail delivery. Netflix may have relied heavily on mail service to deliver DVDs and games to their customers in recent years, but they also have a growing streaming community which allows customers to pay a fixed amount each month for access to hundreds of titles right on their television or computer. That means a lessened dependence on snail mail.

All in all, it will be interesting to see exactly what effects the move will have on these businesses and others when it goes into effect during the week of August 5th. And how long it will take the USPS to recover once it puts it into action?

Is this the right move for the USPS? Let us know what you think.