A Lot to Chew On: the USPS
If you follow postal news at all, this has been your week to read more than work! With announcements, meetings, op-eds and straightforward news items — all about the fate of U.S. Postal Service, essentially — flooding our email inboxes and newspapers, it's been almost overwhelming.
Of course, it needs to feel that way, because the USPS is in a dire situation. Almost immediately after the announcement that the USPS earned a profit of $179 million in December, reality struck: The USPS lost $297 million during the first quarter of its 2010 fiscal year, which ended December 31, 2009. That's called a short-lived celebration.
In fact, during the first two months of fiscal 2010, there was a $476 million total net loss. Overall, last year, the USPS reported a net loss of $3.8 billion for its 2009 fiscal year. Gulp.
At least the USPS is being awfully realistic about it. "[December was] an indication that things are starting to turn up, unfortunately for us the economic drivers that affect mail volumes the most, unemployment and investment, appear to be lagging," said Yvonne Yoerger, spokeswoman for the USPS. "So we are still foreseeing for the year a continuing loss of mail volume."
How much of a loss?, you ask. "Our volume for 2010 is projected to be approximately 167 billion pieces, a decline of approximately 10 billion pieces from last year's total," related Joseph Corbett, CFO and EVP of the USPS.
"Unfortunately, economic drivers that significantly affect mail volumes, such as continuing high unemployment levels and lower investments, appear to be lagging general economic recovery and last quarter's growth in GDP (gross domestic product)," he continued. "This situation, coupled with the growth in electronic alternatives to mail, creates a very challenging environment."
Ah, yes, the alternatives. Namely, email, but also mobile and even social media. Direct marketers, even mailers, are increasingly using these channels to get out their campaigns, their offers and their pleas. They see the future, and it's got less mail.