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U.S. Postal Service in Crisis Beginning of the End?

U.S. Postal Service in Crisis Beginning of the End?. Newspaper Target Marketing Coalition New Orleans March 7, 2012. USPS Challenges. Volume – Declining Steadily Price – Rising but Capped Universal Service Obligation Labor Costs Pre-Fund Retiree Health Benefits

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U.S. Postal Service in Crisis Beginning of the End?

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  1. U.S. Postal Service in CrisisBeginning of the End? Newspaper Target Marketing Coalition New Orleans March 7, 2012

  2. USPS Challenges • Volume – Declining Steadily • Price – Rising but Capped • Universal Service Obligation • Labor Costs • Pre-Fund Retiree Health Benefits • Debt Ceiling – Maxed Out / $15 Billion

  3. Volume by Mail Type

  4. Revenue by Mail Type

  5. USPS Incurring Unsustainable Losses

  6. USPS Strategic Plan $20 Billion Savings by 2015 • Legislative Initiatives Eliminate Pre-Funding of Retiree Health Benefits Eliminate Saturday Delivery Refund Overpayments to Federal Retirement System • Operational Initiatives Retail: Closing Down Post Offices Network: Close and Realign Sortation and Transportation Facilities Service Standards: Change Overnight Delivery of FCM/Periodicals Reducing Workforce by 155,000 Employees Manage Own Healthcare Outside the Federal Government

  7. What Does Congress Think?

  8. Legislative Proposals U.S. House of Representatives (H.R. 2309) • Turn USPS over to a Control Board • Commission for Post Office Closings • Eliminate Saturday Delivery • Increase Rates (CPI & 5%) for “Underwater” Products (e.g. Periodicals) U.S. Senate (S. 1789) • Provide USPS with RHB / Pension Relief • Eliminate Saturday Delivery (after 2 years and a GAO study) • Non-Postal Products (E-Commerce?) • NSAs can Lose Money to Retain or Grow Volume

  9. What Does Future Look Like for Newspapers ? • Periodicals • Higher Rates/Poor Service • Standard Mail • Continued Pressure on Rates • New Promotions (Sat/H.D. Incentives/Mobile Barcodes) • USPS Strays into Private Sector Competition (EDDM)

  10. Opportunitiesfor Newspapers • Distribution Revenue • Delivery of Magazines • 5-day Delivery (Newspapers Own the Weekends) • Convince Congress to Open Up the Mailbox? 2. Convince USPS of a TMC Retention Strategy • Data on TMCs in Alternative Delivery • Creative Proposals or Price Adjustments Over Time

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