by Tim Kenyon
CORRIDOR – The U.S. Postal Service is trying to change its business model.
The organization is following the trend of businesses and government entities to reshape operations to achieve greater efficiency.
“People need to remember we’re not tax supported. We haven’t used any tax funds since 1982,” said Richard Watkins, a regional USPS spokesman based in Kansas City. “That’s a good thing and we want to keep it that way.”
After a lot of discussion over the past few years, the USPS recently proposed ending Saturday delivery service to all route customers.
“It’s important to reinforce the message that the postal service needs a new business model,” he said. “The one we’ve been working under was put in place in 1970, which worked off of the premise of an increasing volume of mail.”
USPS needs Congressional approval before the process to end Saturday delivery can start. Mr. Watkins estimated up to six months would be needed upon approval before the step could be completely implemented.
Brick and mortar offices, vehicles, carriers and fuel – those fixed costs and overhead grew until 2006 when delivery mail growth stopped, Mr. Watkins said.
“It’s too easy to blame it all on the Internet; because the Internet was quite healthy in ’06. The economy was a double whammy for us,” he said. “We understand there’s no simple quick fix for the postal service economic issues, but we want a comprehensive approach as we concentrate to control costs.”
USPS combed out expenses during the last several years.
For instance, carriers decreased from about 850,000 to 600,000 over 10 years via attrition, he said.
Consolidating carrier routes has been under way throughout the Corridor communities, he said. Nationally, almost 12,000 were eliminated in 2009. Mr. Watkins credited the National Association of Letter Carriers’ cooperation to make that a smother process.
The route consolidation should not affect customers much, with slightly earlier or later delivery and a more frequent change in carriers the most likely impact, he said.
The USPS 2009 annual report noted a cut of more than $6 billion in costs, including:
— Cutting 115 million work hours, the equivalent of 65,000 positions.
— Closing six district administrative offices.
— Reducing authorized staffing levels at national and regional offices by 15 percent.
— Selling unused and underutilized postal facilities.
— Adjusting post office hours to better reflect customer use.
— Consolidating mail processing operations.
— Halting construction of new postal facilities.
“We’ve got almost triple the number of post offices as McDonald’s has restaurants,” he said.
— Freezing salaries of USPS officers and executives.
“Our focus is on universal service and to continue to provide great service,” Mr. Watkins said. “We hit more than 95 percent of first-class mail on time as measured by an independent firm recently. While customer satisfaction is at historic highs, it’s not perfect, but that shows employees are doing the right thing. We can do better, but to do that we need flexibility to be more nimble and to respond quickly to changing needs of our customers.”
On a positive note, the parcel-shipping business is doing well despite the economy, he said.
“If it fits, it ships just as the commercial says. Residential and business customers have five sizes of containers to use,” Mr. Watkins said. “We’ve made tremendous strides in shipping and packaging business that we’re proud of. We’ve shown how we can shift in a different market place.”
Some people counter that the post office is still a meeting place, but that time has passed to a great extent.
“We take great pride in the number of offices and the number of communities in which we have offices, but when we’re bleeding red ink, we’ve got to look at ways to change.
And while Saturday carrier delivery may end, people will still be able to conduct business on reduced hours at offices and they’ll get mail that day if they have a box there.
If Saturday USPS service ends, two similar businesses don’t expect much change.
“We only offer air package service on Saturday, so it’s normally a slow day,” said Calli McNamara, who works at the UPS Store on 25th Avenue in Coralville.
While UPS laid-off thousands across the country and reduced sites, business is good at the Coralville location, Ms. McNamara said.
“It’s an odd situation because there was a store in North Liberty but it closed, so our business here is up in recent months,” she said.
The Mail Boxes & Parcel Center at 223 Edgewood Rd NW in Cedar Rapids takes in USPS, UPS and Federal Express packages to send for customers. It also offers mail boxes for people.
Nonetheless, the slow business pace on Saturday probably will remain the same, a staffer said last week.