USPS TRANSFORMATION PLAN HAS ITEMS OF INTEREST TO MAILERS

The following is a perspective by postal commentator Gene Del Polito prepared for Direct magazine. The views expressed are solely the author's and do not necessarily reflect the official views or policies of the Association for Postal Commerce.

On the first Friday in April, Postmaster General Jack Potter unveiled the Postal Service's long-awaited "Transformation Plan." It was a document that had been called for by the U.S. Senate's postal subcommittee in response to a report by the U.S. General Accounting Office (GAO) that cited the Postal Service as an institution "at risk." A complete copy of the transformation plan is available on the USPS' web site at http://www.usps.com/strategicdirection/transform.htm/. If you haven't yet read the plan, you should, not only to get a better idea of how the Postal Service views its own long-term future, but also to get a heads-up on some of the strategies the USPS plans to employ to wring out additional operational savings over the next few years.

For instance, there are at least two items that ought to be of some interest to direct marketers. The first pertains to the Postal Service's desire to consolidate all package services into two major groupings, i.e., those packages weighing less than five pounds and those weighing more. The USPS' main objective is to define the nature of the package services class on the basis of how those packages are processed and handled by the Postal Service. On its face, the proposal would seem to logical and benign. On closer examination, the benignity fades.

Today's package service class consists of mail matter that is far from homogeneous in terms of its market-based characteristics. Packages sent by Parcel Post often consist of matter that is remarkably different from that which is sent by Bound Printed Matter, Media Mail, or Library Rate. Furthermore, these subclasses have historical and legislative antecedents that would make the creation of two "content-neutral" subclasses a difficult exercise. What may seem logical and acceptable to the Postal Service, in all likelihood, will be viewed differently by the users of these subclasses and the Postal Rate Commission.

Similarly, the USPS has expressed an interest in perhaps "standardizing" the characteristics of the flat-size mail it accepts and processes on its flat-mail sorters. Again, "standardization" sounds like a good idea, but only until you realize that what mailers call "standard" (i.e., "acceptable") and what the USPS calls "standard" can be two different things.

If "standardization" means higher rates for those who present flats that don't fit the Postal Service's desired mold, that's not a good thing – particularly if there are some good, market-based reasons for mailers' configuring flats the way they do.

If recasting the world of "packages" into just two subclasses, and if the "standardization" of flats are intimately related to the Postal Service's plan to pull five billion dollars worth of costs out of the system over the next few years, postal officials had better begin talking to its customers about what it has in mind. Otherwise, the USPS might find itself facing an angry customer base when it finally gets around to proposing these changes within the regulatory arena.