Many posts worldwide currently have five-day delivery. In the early 1970s, Australia Post initiated five-day delivery to most of Australia. In 1982, Canada Post also reduced delivery to five days a week. Several European posts now deliver fewer than six days per week, and others are considering changes in delivery frequency. In May of this year, Singapore’s post will become the latest to stop Saturday collection and delivery service in response to declining mail volumes.
In the United States, almost one week in five is already at the five-day service level due to federal holidays. The Postal Service has managed these shortened holiday weeks with virtually no adverse effects on service performance, in part because both the public and the Postal Service are prepared for them.
Once fully implemented, a shift to regular five-day street delivery is expected to save the Postal Service approximately $3 billion a year. Most of these savings will come from carrier labor and fuel costs. Other savings will be gained from processing, transportation, maintenance, and a reduction in future employee benefit obligations.
Exhibit 1 shows the decreasing trend in real (inflation-adjusted) revenue and average number of mailpieces per day, per delivery point, between FY 2000 and FY 2009. An analysis by the Boston Consulting Group shows that trend will continue over the next decade, with real revenue per delivery point declining almost 50 percent between 2000 and 2020.
| 2000 | 2009 | 2020 | |
|---|---|---|---|
| Average pieces per delivery point per delivery day | 5 | 4 | 3 |
| Real (inflation-adjusted) revenue per delivery point per day (current $) | $1.80 | $1.40 | $1.10 |
Source: The Boston Consulting Group
