USPS Bulks Up Same-Day Delivery Efforts

In an effort to remain competitive with other, perhaps more nimble packaging and shipment operators, the U.S. Postal Service is boosting its same-day delivery business.

As reported by The Wall Street Journal on Monday (Aug. 17), the USPS is bringing a plethora of items to consumers, ranging from water to fresh fish and everything in between as the battle rages on with FedEx, UPS and, of course, the eCommerce giant that is Amazon.

In an interview with WSJ, Postmaster General Megan Brennan, six months into her tenure in that role, said that “clearly, the consumer demand is such that we all want the package today. So we’re being responsive to that.” And Brennan is also looking for new avenues of business, with an eye on shipping alcoholic beverages (which needs Congressional approval) and expanding Sunday delivery.

Volumes in the service’s most profitable niche, first-class mail, fell 2 percent through the first three quarters of the current fiscal year. That pales in comparison to the 20 percent dip seen in the past decade. For the moment, new initiatives have been going through a ramp-up in costs, chiefly labor, which have put a damper on margins.

In the meantime, the postal agency has partnered with Amazon to bring grocery delivery to San Francisco, with another half dozen markets following and same-day delivery becoming a New York staple a little under a year ago. And, as noted by WSJ, the agency is looking to buy 180,000 new trucks that are ideal for hauling packages.

One other competitive strategy: pricing. The postal agency slashed its priority mail prices by roughly 58 percent for its biggest customers, charging $1.70 on average for companies ranging from UPS to Amazon, delivering from post office to a customer’s residence, a higher margin business as those companies are willing to do the sorting, according to WSJ.

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