Chapter 2 Postal Operations

5. Package Services


Priority Mail and Express Mail volume and revenue grew as customers responded to initiatives that make it quick, easy, and convenient to use these products. PC Postage and Click-N-Ship contributed to growth as did an expanded partnership with eBay. Requests for Carrier Pickup, which allow customers to have prepaid packages collected for free the next delivery day, increased significantly, with more than 25 million packages picked up. The Priority Mail flat-rate envelope and box remained very popular, and the Postal Service requested that the flat-rate box be made a permanent classification in the R2006-1 rate case.


Since the Postal Service first introduced Click-N-Ship online shipping on, growth has been continuous. Revenue grew by more than 55%, generating more than $168 million. From the convenience of their homes or offices customers can use stored addresses to create labels with and without postage, and then click on a link to schedule a Carrier Pickup, saving time and a trip to the Post Office. Several new features were added to increase the value of the online shipping application. Global Priority Mail and Global Airmail Parcel Post were added to the services that Click-N-Ship can be used with, and in August, the Postal Service rolled out Click-N-Ship service for packages destined to Army Post Office and Fleet Post Office addresses.


Parcel Select is the Postal Service’s ground package-delivery product designed for medium-to-large shippers who enter packages at destination facilities. After the bankruptcy filing of the largest package consolidator, alternative solutions were found to maintain a majority of this business. The Postal Service holds quarterly meetings with the national consolidators’ senior management to discuss issues such as scanning, service, and manifest accuracy. Parcel Select service performance was again at an all time high, as is the percent of packages entered at the destination delivery unit.


Direct-to-consumer online and catalog sales continued to rise and with it, so has the number of returned parcels. The Postal Service has been able to capitalize on this growth with convenient return solutions such as Parcel Return Service (PRS) and Merchandise Return Service. PRS, a worksharing returns program, has been eagerly adopted as merchants appreciate the value of offering a quick, easy, and convenient return service. In 2006 PRS expanded into the return delivery units (RDU), resulting in more efficient operations for shippers by allowing them to pick up returned packages at the same delivery unit where their packages were first entered for delivery. PRS is now available through more than 1,800 RDUs.


The Postal Service continued to focus on reducing costs that support package service products. Efforts include managing the expense of packaging supplies and coordinating actions to improve mailer parcel barcode quality. Another program, through which Express Mail Corporate Account (EMCA) customers pay for their postage by credit

card, was created to enhance service and increase financial controls. Customers are opening new accounts and many trust accounts are converting to the EMCA.

D. International Mail

1. Volume and Revenue

Due to weight per piece growth and a rate increase in January 2006, international mail revenue increased 1.6%. International services that saw revenue growth included Global Express Mail, Global Priority Mail, Global Air Parcel Post, International Surface Airlift, and International Priority Airmail. International mail volume decreased 6.9% overall, primarily in Economy Mail and Airmail.

2. Improving International Services

A new Global Business organization was created in July 2006 to manage Postal Service worldwide business. It focuses on international business management, international financial and business analysis, global network strategy and technology, and international relations. It is also responsible for international operations, including operation of the five international service centers.

The Postal Service continued a high level of service performance to Europe for Express Mail and parcels while reducing costs for delivery by more than $10 million to preserve low rates for U.S. customers. Work continued with the chief executive officers of the postal administrations of China, Hong Kong, Korea, Japan, and Australia to maintain excellent service quality for express and parcel services between these regions.

The Postal Service continued a multi-year process of providing online shipping tools for international business customers. Effective September 2006, the Postal Service launched application program interfaces (APIs) for Global Priority Mail and Global Airmail Parcel Post shipping labels through Postal Service Web Tools. These new APIs allow customers to print shipping labels that combine mailing information with Customs Declaration CN 22 — Sender’s Declaration (green label), and Customs Declaration and Dispatch Note — CP 72, thereby eliminating the need for a separate customs form. Business customers can install the APIs into their eCommerce Web sites or their own shipping operations allowing users to print shipping labels without leaving their Web site or workstation.

3. State Department Coordination and Universal Postal Union Congress

The Postal Service worked with the U.S. Department of State to represent the United States in the Postal Operations Council (POC) of the Universal Postal Union (UPU) held in the spring of 2006. A total of 104 countries attended the session, participating in more than 80 meetings of POC committees, boards, project teams, and subgroups. The POC considered some 80 proposals on issues ranging from terminal dues to the barcoding of registered items to the setting of inward land rates for parcels. The POC approved 44 proposals, including two U.S. reservations insuring that the domestic law concerning a ban on the importation of anabolic steroids would be respected, rejected 15 proposals, and referred 21 proposals for further study.