Tuesday, March 2, 2010

No Saturday Mail!

In the movie, The Postman, Kevin Costner played an post-apocalyptic letter carrier who conned people into believing that the government was still delivering mail. The movie was ironically set in 2013 which is only a few years from now. The new Postal Service had no money and no government yet they decided to resume delivering mail which ultimately led to the restoration of the United States.

Now in our current economic climate with revenue declining and losses mounting, the U.S. Postal Service wants to end Saturday deliveries in order to save $3.3 billion a year. In most free market business decisions this would be a done deal. However because the postal service is a quasi-government (so it says it is a independent entity of the executive branch) it will require Congressional approval and a change in law to do so. Which means this is only a pipe dream.

The Postal Service continues to borrow from the Federal Treasury each year to fund its deficit operations. Most businesses would have already sought bankruptcy protection to keep afloat. Raising postal rates does little to grow revenue as most free market establishments would not always seek to raise prices alone but would seek to cut costs and improve service first. But since it lacks competition in the delivery of mail there is little incentive to provide better service.

We have all waited in long lines for a postal worker to treat our presence as if we were interrupting their work. Also, to be left waiting while each of the union workers take their breaks during peak hours leaving customers frustrated and angry. Yet we wait.

What the U.S. Postal Service should do is focus on improving customer service. Turn each post office into self-sustaining profit centers. If it does not make money then close it and let another office handle those customers. It is apparent that many of the things we once used the Postal Service for are no longer needed or can be achieved by utilizing UPS or FedEX. Who both have far superior service and reliability even though their rates can sometimes be higher.

Maybe we should just allow mail delivery competition. This would force the Postal Service to improve its service levels. The Postal Service is the second largest employer in the country. It has a $1.0 billion payroll budget weekly. Yet there has not been any talk of reducing headcount to help hold down expenses. This would be silly talk because the workers are union workers and no union worker should never lose his job, not ever.

The talk of stopping Saturday delivery is a good start but the real issues are starring the postal service square in the face. With the advent of email, e-cards and more reliable delivery services, the U.S. Postal Service role has diminished. Now it is time for it to get in line with their new reality and face the paradigm shift that has already occurred. Improve customer service levels and overall satisfaction rates among consumers. Close some of the 36,000 branch offices and make them self sustaining. Either improve or go out of business. I am sure there are plenty of businesses that could be started to replace this inefficient business.

These are my words! Please post yours!