2009 was a tumultuous year for the Postal Service and the entire U.S. economy. The historic declines in mail volume and revenue that began in 2008 accelerated as the economy continued to weaken. The Postal Service made herculean efforts to deliver record service despite enormous reductions in workhours and more than $6 billion in spending cuts. Total mail volume was 177.1 billion pieces, a decline of 25.6 billion pieces, or 12.7 percent. Overall, the Postal Service incurred a net loss of $3.8 billion, resulting in a $6.8 billion or 9.1 percent decrease in revenue.
First-Class Mail and Standard Mail, which make up 94 percent of volume, decreased almost 24.3 billion pieces or 12.7 percent compared to last year, with an associated drop in revenue of $5.6 billion, or 9.5 percent. Total mailing services revenue decreased $6.6 billion, or 9.9 percent, with a corresponding volume decrease of 25.5 billion pieces, or 12.7 percent, compared to last year. Most of this decrease can be attributed to the downturn in the economy, particularly the financial and real estate sectors, which are heavy users of the mail.
The Postal Service began to implement a more robust customer experience measurement system to replace the current customer satisfaction surveys. The new system evaluates the total customer experience, from mailpiece design to preparation to customer service to delivery, and allows the Postal Service to pinpoint areas in need of improvement and better adjust to customer needs.
For the fifth consecutive year, the American public rated the Postal Service as the most trusted government agency to safeguard personal information, according to Ponemon Institute’s national privacy trust study. The Postal Service was also ranked among the top six most trusted among all organizations — public or private.
The Postal Service increased customer value by pursuing aggressive marketing strategies and pricing innovations to grow the mail. The Postal Service launched one of its largest and most integrated advertising campaigns to raise awareness of Priority Mail Flat Rate boxes — “A simpler way to ship” — and one of the best bargains in the marketplace. The Summer Sale and Saturation Mail incentive programs made it easier for businesses to continue their direct marketing campaigns in the down economy.
The Postal Service introduced new service standards for all market dominant mail classes, and in January began reporting performance against the standards on usps.com. Performance is measured primarily using hybrid systems that combine mail processing scan data with external data that is independently collected and verified by an outside contractor. (Additional information on development of the new measurement systems is contained in Chapter 6.)
All operations continued to benefit from increased data on mail flows which, combined with new systems and management tools, are highlighting opportunities to improve service consistency and efficiency. Process standardization is helping integrate data across functions and plants, reducing variability, and providing more consistent and predicable end-to-end service performance. Intelligent Mail (IM) barcodes are being used by a growing number of customers, who are discovering a wealth of new information about the status of their mail in transit.
The Postal Service’s award-winning Web site, usps.com, remains one of the most popular government sites, with more than 1.2 million visitors each day. Ongoing enhancements make it easier to use Click-N-Ship and PC postage, find and pay for a Post Office Box, schedule a package pickup, including parcels being returned, and apply for a permit for Business Reply Mail. The supplier portal at usps.com was redesigned to further improve collaboration between the Postal Service and its business partners.
Field testing continued on the Flats Sequencing System (FSS) — which when completed will automatically sort and sequence large envelopes, magazines, catalogs, and circulars into the order that they are delivered by carriers. FSS technology is intended to increase efficiency by reducing manual handling of flat mail, resulting in more consistent service and lower processing and other costs. Expanded deployment is expected in 2010 after testing is completed.
The Postal Service continued its environmental stewardship by expanding energy conservation and recycling efforts at facilities nationwide. Promoting programs such as recycling mail in Post Office lobbies makes it easier for customers to make environmentally friendly choices. The Postal Service remains the nation’s only shipping company to achieve Cradle-to-Cradle certification for its Express Mail and Priority Mail packaging materials, as well as display materials in Post Offices. This certification means more than 15,000 metric tons of carbon emissions are prevented annually. Customers can also use usps.com and their postal carriers to deliver stamps and free packaging to their doors, and to collect all their outgoing mail and packages, helping them save gas, money, and time.
The Postal Service worked closely with Congress and the Administration to identify legislative changes that would provide necessary flexibility to pursue its mission and ensure financial viability. In August, the Government Accountability Office (GAO) listed the Postal Service as one of its “high risk” government agencies. In its report, Restructuring the U.S. Postal Service to Achieve Financial Viability, GAO suggested that the Postal Service develop and implement a broad restructuring plan noting that many initiatives would require Congressional support.
