Thanks for My Mail, USPS. May I Have Milk and Eggs With That?
First, the U.S. Postal Service delivered groceries for AmazonFresh in San Francisco. Then on Friday, USPS expanded the delivery area to "additional major metropolitan markets nationwide."
At 4:19 p.m. on Thursday, the Postal Regulatory Commission issued an "Order Authorizing Customized Delivery Market Test." (Opens as a PDF) In other words, the PRC is allowing USPS to conduct an expanded market test for the next two years, beyond what the postal service has already done in San Francisco. What USPS did there was load up on AmazonFresh bags—delivered to USPS by AmazonFresh's participating retailers—and drop them off at the doors of San Franciscans who had ordered groceries online.
During the original pilot that began on Aug. 18, USPS dropped off an average of 160 AmazonFresh tote bags a day in the test's 38 ZIP codes. That equaled one to four bags at each address, according to the PRC order.
On Sept. 23, USPS filed a notice with the PRC "announcing its intent to conduct a market test of an experimental product called Customized Delivery." On Thursday, the PRC authorized the 2-year test.
This test coincides with the postal service's focus on package delivery as its future.
"As First Class mail has declined, the U.S. Postal Service's package revenues are growing more than 10 percent compared to last year, and advertising mail revenues are relatively steady," says USPS Board Chairman Mickey D. Barnett in his Sept. 17 testimony to Congress. "However, to fully leverage the package revenue opportunities and remain competitive, the postal service will need to invest billions of dollars in new delivery vehicles, infrastructure and new package sorting equipment in the near future."
Even as USPS decided to keep its rates steady in January, UPS will implement a 4.9 percent increase on Dec. 29 and FedEx plans the same price hike—4.9 percent on many of its products—on Jan. 5.