A great article by Mark Fallon on the Berkshire Company Blog. A short introduction to the article and link to read it in full is below:
Last year, I wrote a letter to my United States Senators(Elizabeth Warren and Edward Markey) about the need for the Senate to confirm President Obama’s nominees to the U.S. Postal Service (“USPS”) Board of Governors. Senator Warren’s staff didn’t think that my letter warranted a response. One of Senator Markey’s aidescalled my office to share the senator’s support for this issue. He believed that some of the nominees would be confirmed during the “lame duck” session after the elections.
Back row (left to right): Allen Aven, Tracey Dunlap, Shawneen Betha, Miles French, Michael Waskover, David Martin, Cindy Bolles, Dr. Joshua Colin, Glenn Sollenberger, Lyle Gaines, Carrie Frankenfield, Bob Fehnel, Jason Hirschvogel, David Mastroianni; Front row (left to right): Julie Gosdin, Yulonda Francis-Love, Jagdeep Grewal, Roxanne Hosein, Cathy Rupard, Judith Antisdel, Cheryl Hudson, Karen Brondel, Art Gerckens
On August 5th, 2015 the U.S. Postal Service recognized 24 Postal Customer Councils (PCCs) – in eight award categories – for their achievements and creativity in communication, leadership, membership growth, innovation and educational program offerings.
As part of the festivities, the award finalists assembled at Postal Headquarters where they participated in roundtable discussions with other awards finalists, the Postmaster General (PMG), Deputy Postmaster General (DPMG), Chief Operating Officer (COO) and other officers. They shared key strategies and best practices for education, communication, collaboration and outreach.
The awards presentation followed the roundtable discussion where the PMG, DPMG, and COO presented the awards.
With more than 150 active PCCs across the country, achieving this level of recognition is commendable.
The 2015 National PCC Leadership Award winners are:
|PCC of the Year Large Market||PCC of the Year Small Market||Innovation of the Year|
|Greater Dallas – Gold||Central Missouri – Gold||Fairfield County, CT – Gold|
|Greater Portland, OR – Silver||Capitol City, MO – Silver||Greater Dallas – Silver|
|Sacramento – Bronze||Lehigh Valley, PA – Bronze||Harrisburg, PA Capital – Bronze|
|Communications Excellence||Education Excellence||Industry Member of the Year|
|Greater Dallas – Gold||Fairfield County, CT – Gold||Cathy Rupard – Gold|
|Greater Portland, OR – Silver||Greater Dallas – Silver||Judith Antisdel – Silver|
|Greater New York – Bronze||Greater Portland, OR – Bronze||John Millet – Bronze|
|Postal Member of the Year||District Manager of the Year|
|Lisa Landone – Gold||David Mastroianni – Gold|
|Cheryl Hudson – Silver||Julie Gosdin – Silver|
|Joshua D. Collins – Bronze||David Martin – Bronze|
August 12-14, 2015 at Camden on the Lake Website: www.camdenonthelake.com Phone: 573-365-5620
Reservations are very limited and currently being accepted. Please make your reservations early due to the limited availability of rooms. Charge cards will not be charged until check in.
When making your reservation, please use promo code: CMPC0815. Conference rates will be offered on Monday, August 10 and Tuesday, August 11. Based on availability, the conference rate might also be available on Sunday, August 9.
For up-to-date information, please forward your email address to email@example.com.
The Central Missouri PCC is one of three PCC’s being considered for Small Market – PCC of the Year Award for 2015. In addition, our own Cathy Rupard is one of three finalist for Industry Member of the Year Award for 2015 as well.
The final announcement will be made August 5th, 2015.
The United States Postal Service and the Central Missouri Postal Customer Council Invite you to attend our
Details for The Crawl:
Tour the Columbia Processing Facility. This facility is located at the Postal Service’s Columbia airport location at:
Address: 11450 S Airport Road
Tour Begins at 10:00 a.m
Questions: 573-474-8877 or firstname.lastname@example.org. Please RSVP asap, tour is limited to 40 people.
Emerging and Advanced Technology Promotion Dates Revised
On May 7, 2015, the Postal Regulatory Commission approved the proposed prices and classifications for Standard Mail, Periodicals, and Package Services which include the full 2015 Promotion Calendar.
While none of the promotion requirements have changed, the dates for the Emerging and Advanced Technology Promotion have been revised. All 2015 Promotions will be implemented as follows:
Emerging and Advanced Technology
Mail Drives Mobile Engagement
March 15 –
April 15 – November 30, 2015
May 15 –
July 1 –
First-Class Mail and Standard Mail
First Class Mail
Shelter Insurance of Columbia, MO has been selected to receive the prestigious 2015 Mail Technology Award.
The Postmaster General and Executive Leadership team will be recognizing significant industry achievements at a special awards ceremony being held at the Nation Postal Forum in Anaheim, CA on Monday 18th, at 4:30 pm; where this award will be presented.
The letter announcing the selection was received by Lisa Brock at Shelter Insurance and can be viewed here.
Congratulations to Shelter Insurance!
This seminar is designed for Small/Medium MAILERS.
Please join Glendia Ayers, Business Development Specialist for the United States Postal Service (USPS).
We will discuss Click and Ship for Business, Every Door Direct Mail Program and the coupon available for a limited time.
And, just in time for all your holiday shipping the NEW LOWER Priority Mail Mailing Opportunities!
Where: Courtyard Marriott, 3301 Lemone Industrial Blvd, Columbia, MO 65201
When: November 13, 2014
One session 8:00 a.m. – 10:00 a.m.
Breakfast is included in your registration. REGISTER ONLINE HERE
Questions? Contact Cathy Rupard at 573-474-8877 or email email@example.com
Proposes an Additional $0.9 Billion in Annualized Contributions
WASHINGTON ̶ On January 15, the Postal Service filed with the Postal Regulatory Commission (PRC) a Market Dominant price change based on a Consumer Price Index (CPI) cap authority of 1.966%.
The Postal Service believes strongly in the value of mail and maintaining relevance for today’s customers, offering reasonable pricing, workshare incentives, and meeting its obligation to the American public to strengthen its financial condition.
All of the proposed price changes are based on CPI prices plus the Exigent Surcharge approved by the PRC in Docket Nos. R2013-10 and R2013-11.
Using the CPI, we estimate that this price change will generate an additional $0.9 billion in contribution on an annualized basis. If the PRC approves the filing, the proposed April 26 implementation of the prices will improve the FY 2015 financial outlook by $0.4 billion in contribution.
The key elements of the CPI case include the following:
Various industry webinars will be scheduled to offer depth and insight into the proposed changes.
In November, the Postal Service filed for the transfer of First-Class Mail Parcels to a competitive product and the elimination of Return Receipt for Merchandise as a special service. These matters are still pending with the PRC. For the purpose of this filing we are assuming that these products will remain in the Market Dominant category.
Shipping and Package Services Revenue Up 6.6 Percent
January Price Increase Offsets Continued Volume Loss in First-Class Mail, Driving All Mail Revenue up $424 Million
Need for Comprehensive Legislation Remains Urgent
WASHINGTON — The U.S. Postal Service ended the June 30, 2014, quarter with a net loss of
$2.0 billion, compared to a net loss of $740 million for the same period last year. The Postal Service
has recorded a loss in 21 of the last 23 quarters, the excepted quarters being the two in which
Congress rescheduled the Retiree Health Benefits prefunding payments.
June 17, 2014
8:00 a.m. until 1:00 p.m.
Breakfast and lunch included
Courtyard by Marriott
3301 Lemone Industrial Drive
Central MO PCC
PO BOx 1773
Columbia MO 65205-1773
firstname.lastname@example.org or Cathy Rupard at 573-474-8877
Protect yourself from Internet Fraud, Identity theft,internet lottery scams and more.
This seminar is designed for ALL MAILERS.
Please join Inspector Jamie Portell, United States Postal Inspection Service and Detective Chris Lester,
Boone County Sheriff’s Department as they lead the discussion. Victims of cyber-attacks are in the headlines on a regular basis. Please join us as these two experts share information on how to keep from becoming a victim.
DATE: March 28th, 2014 (DOWNLOAD INFORMATION)
The following article is written by Jeff Brooks, the author of The Fundraiser’s Guide to Irresistible Communications: Real-World, Field-Tested Strategies for Raising More Money and creative director at TrueSense Marketing.
Questions I’m Most Often Asked about Direct Mail Fundraising:
Is the Internet the death knell for direct mail?
Not even close. Direct mail is a long way from death. It’s still the most effective fundraising medium (after the church offering basket) and it’s many times more effective than email.But the way it works is changing. One important change is the way direct mail and the Web are becoming intertwined. Donors are moved by the warmth and personal touch of direct mail, then going online to give. It’s the best of both worlds when they do that: The higher average gifts we get from online donors, combined with the higher frequency and retention we see with direct-mail donors. This is on its way to becoming the typical way giving happens. To be effective in that world, we need to make sure our direct mail and online communications are tightly integrated: Same look and feel, same language, same offers.
The National Postal Forum is almost here!
The National Postal Forum continues to gather USPS Executives and the Mailing Industry’s most influential thought leaders and innovators! The National Postal Forum kicks off on Saturday, March 15th with Pre-Conference events featuring a new reception at the Smithsonian National Postal Museum and continues through Wednesday, March 19th with a Closing Concert featuring the band America!
The Early Bird registration closes this Friday, January 31st. Please let your members know to register before that date to take advantage of the discounted rates.
LINK: Brochure for Event
It has just been announced that the Postal Regulatory Commission has approved an exigent increase in pricing that will impact most mail by 6%. Back in the November I had written about this as a potential, but thought now would be a good time to go over what we believe to be the specifics of the increase.
For the past 16 years, I have been creating comparison charts for my clients that go over the changes in rates to show how it will affect budgets. The reason that I do this is that when the USPS talks about a 4.3% increase, this is overall. Based on the type of mail you do, the increase could be higher or lower. You need to look at the class, weight, zone, density and special services required to see the true impact. Also, when you look at the new rate charts provided by the USPS, they typically will not show the level of detail needed (Previous and new rates, side by side) to see these differences.
The remainder of this article will look at the main classes of mail and will break down the specific increases. Hopefully this will help you budget for the increase by seeing how it will impact your mail.
The U.S. Postal Service is disappointed with the portion of last week’s ruling from the Postal Regulatory Commission (PRC) which held that the implementation of Full-Service Intelligent Mail barcode (IMb) constitutes a rate increase. This ill-conceived decision will impair complete adoption of Full-Service IMb and hinder the Postal Service’s ability to promote a technology that enhances the value of mail, which is critical to the development of next-generation digital products and services. The PRC’s overly expansive view of the price cap demonstrates why comprehensive postal reform legislation should include additional pricing authority for the Postal Service Board of Governors.
Due to the PRC ruling, the Postal Service is delaying the January 26, 2014 implementation of the Full-Service Intelligent Mail requirement for automation price discounts. Mailers who are not currently enrolled in full-service effective January 26, 2014 will still be able to claim automation prices. To achieve the best pricing, however, mailers must continue meeting full-service requirements.
Washington, DC -Today, the Postal Regulatory Commission issued its decision in Order 1890 on the Postal Service’s request to increase prices January 26, 2014. The Commission determined that the rates proposed by the Postal Service are consistent with the law, provided that the Postal Service does not implement Full Service IMb requirements concurrently with the proposed increased rates.
Full Service IMb requires each piece of mail, each bundle, and each pallet to have a unique identity barcode. The Commission determined that Full Service IMb mail preparation requirements are a classification change and that its effects must be included in its calculation of the percentage change in rates.
Concurrent implementation of the proposed rate adjustments and the Full Service IMb requirements would result in increases in First-Class Mail, Standard Mail, and Periodicals that exceed the statutory Consumer Price Index price cap, currently at 1.696 percent.
“The Commission’s primary responsibility is to assure predictable and stable rates for mailers bound by the statutory price cap. While we encourage the Postal Service to expand its capacity to track and measure the performance of mail services, this cannot be accomplished in a manner that effectively raises rates by 4.1% and 4.9% for First Class and Standard Mail.” said Chairman Ruth Y. Goldway.
Additionally, the Commission found that the Postal Service must resolve unequal commercial and nonprofit discounts for Standard Mail 5-digit automation flats. The proposed rates violate the requirement that disparities between commercial and nonprofit discounts must be justified by a statutory exception.
The Postal Service may implement the proposed rate adjustments, minus the Full Service IMb requirements, effective January 26, 2014. Alternatively, the Postal Service may adjust its proposed rates for First-Class Mail, Standard Mail, and Periodicals rates in a manner comparable to the implementation of Full Service IMb requirements in Package Services and file amended rates. The Postal Service shall notify the Commission of its intentions and provide necessary supporting documents by November 27, 2013.
The Postal Service proposed that the price of Single-Piece First-Class Mail letters increase from 46 cents to 47 cents. The price of a postcard will remain at 33 cents.
DATE: October 16th – 18th , 2013
LOCATION: Lodge of the Four Seasons • Horseshoe Bend Parkway
315 Four Seasons Dr. • Lake Ozark, MO 65049
For questions, special dietary needs, or additional information, please contact:
Judy Donnell (email@example.com) at 573-474-6193 x1205 or
Cathy Rupard at 573-474-8877 (firstname.lastname@example.org).
Both literally and figuratively, the U.S. Postal Service delivers for America. Even in an increasingly digital world, the Postal Service remains part of the bedrock infrastructure of this nation’s economy, serving its people and businesses and binding the nation together. Below and attached you will find interesting information about your Postal Service.
The Postal Service delivers more mail to more addresses in a larger geographical area than any other post in the world. The Postal Service also delivers to more than152 million homes, businesses and Post Office boxes in every state, city, town and borough in this country. Everyone living in the United States and its territories has access to postal products and services and pays the same postage regardless of their location.
By the Numbers *
65 billion — 2012 revenue, in dollars
160 billion — number of mailpieces processed
40 — percent of the world’s mail volume handled by the Postal Service
1.8 billion — dollar amount paid every two weeks in salaries and benefits
522,144** — number of career employees
108,000** — number of military veteran career employees
31,272 — number of Postal Service-managed retail offices
212,530 — number of vehicles — one of the largest civilian fleets in the world
1.3 billion — number of miles driven each year by letter carriers and truck drivers
39.7 million — number of address changes processed
39 — percent of retail revenue from alternative access channels
423 million — total number of visits to usps.com
67.5 million — number of inquiries handled by the Postal Service Contact Center
246 million — dollar amount of online stamp and retail sales at usps.com
44.1 million — number of Click-N-Ship labels printed
483 million — total revenue, in dollars, from Click-N-Ship label purchases
83.8 million — number of packages picked up using Free Package Pickup
5.7 million — number of passport applications accepted
109 million — number of money orders issued
497 million — amount in revenue from 2,500 Self-Service Kiosks
70,000 — number of stores, banks and Self-Service Kiosks that sell stamps
654,560 — number of new delivery points added to the network
0 — tax dollars received for operating the Postal Service
* all information based on 2012 data, unless otherwise noted
** as of January 16, 2013
WASHINGTON — When new Postal Service Shipping Services prices take effect in January, customers will see an overall price increase of 2.4 percent.
In addition, Postal Service customers will have a new delivery choice for domestic Priority Mail Express in 2014. The new delivery service option will allow customers to send domestic Priority Mail Express packages to most locations in the U.S. by 10:30 a.m. for an extra $5.00 fee. Domestic Priority Mail Express is a fast, reliable service which offers day-specific delivery information, up to $100 free insurance and free package tracking.
Highlights of the new retail pricing for domestic Priority Mail Express products include :
· Retail Flat Rate, Padded Flat Rate and Legal Flat Rate envelopes — $19.99
· Flat Rate Boxes — $44.95
Domestic pricing for Priority Mail Flat Rate products will remain affordable in 2014, with retail prices starting as low as $5.60.
Most domestic Priority Mail products qualify for free insurance up to $50 or $100, and one, two or three date-specific delivery is based on destination ZIP Code. Improved USPS Tracking makes it easier to see packages at pick up, confirmed final delivery and many points in between.
“The Postal Service remains the best in value in the shipping business,” said Nagisa Manabe, Chief Marketing and Sales Officer. “We continue to offer excellent domestic Flat Rate shipping with a price that doesn’t vary by destination.”
The Postal Regulatory Commission (PRC) will review the prices before they become effective on January 26, 2014. Today’s Shipping Services price filing will be available on the PRC website at www.prc.gov.
Please see below and attached the memorandum from Mr. Donahoe announcing the selection of James (Jim) P. Cochrane as Chief Information Officer and Executive Vice President.
October 24, 2013
SUBJECT: Chief Information Officer and Executive Vice President
I am pleased to announce the appointment of James (Jim) P. Cochrane as Chief Information Officer (CIO), effective immediately.
As the Postal Service continues initiatives to add value to the mail for our customers, technology and information products and services are increasingly important to our corporate strategy; and Jim is well-suited to lead our efforts in these areas. As CIO, he will oversee the integration of technology and innovation in all aspects of our operations. Additionally, Jim will direct the advancement of new mail intelligence, engineering systems, information technology systems, payment technology, and corporate information security to meet the changing needs of today’s marketplace.
Prior to being named CIO, Jim served as Vice President of Product Information, where he and his team were responsible for innovations in technologies and tracking systems—including the Intelligent Mail barcode (IMb) and Intelligent Mail package barcode (IMpb)—and increasing the business intelligence they provide. Working together cross-functionally, the team’s efforts resulted in ongoing improvements in scanning and tracking performance, leading us to record- high service levels in those areas.
Throughout his 39-year postal career, Jim has served in a variety of roles, including Vice President, Product Visibility and Operational Performance; Vice President, Ground Shipping; Associate Vice President of Marketing and Strategy for the Expedited Package Services strategic business unit; and Associate Vice President of Sales for the former Northeast Region, where he was responsible for commercial sales of $12 billion annually. Prior to those roles, Jim served 25 years in operations, including positions as District Manager of Customer Service and Sales for the Washington, D.C., Metropolitan Area, and Senior Plant Manager of Northern Virginia.
Jim holds a master’s in Public Administration from American University’s School of Public Affairs.
Please join me in congratulating Jim and giving him your full support in this new role.
Patrick R. Donahoe
Bill to name Columbia Post Office after Specialist Sterling Wyatt
WASHINGTON, D.C. – Today Congresswoman Vicky Hartzler (MO-04) introduced H.R. 4960, which would honor the memory of Missouri-born Specialist Sterling William Wyatt by naming the downtown Columbia Post Office Building at 511 East Walnut Street in his name.
“Specialist Wyatt’s life exemplifies what is good about America and what we all should emulate — service above self,” said Congresswoman Hartzler. “Specialist Wyatt gave his life for his country and left an indelible mark on our hearts. His dedication to serving his community and country were a testament to his faith and family — especially his loving parents, Randy and Sherry. It is humbling to have the chance to memorialize Specialist Wyatt’s patriotism and courage by dedicating this facility – located in the heart of Columbia – to the life of service he led.”
Spc. Wyatt was born and raised in Columbia. Early on in his life, he showed commitment to serving his community by being an active participant in his youth group and volunteering at church. Through his service and hard work, he was quite an accomplished young man: he earned the rank of Eagle Scout, a first-degree black belt in taekwondo, and certification as a Certified Nurse Attendant all before graduating from Rock Bridge High School in 2009.
Soon after graduating, he decided to continue his lifestyle of service by joining the U.S. Army. He was assigned to the 5th Battalion, 20th Infantry Regiment, 3rd Stryker Brigade Combat Team, 2nd Infantry Division at Joint Base Lewis-McCord, Washington and later deployed to serve his country in Afghanistan. Tragically, at the age of 21 years, Spc. Wyatt was killed on July 11, 2012 while on patrol in Kandahar, Afghanistan. His vehicle was attacked with an enemy improvised explosive device (IED).
“Our military men and women voluntarily sign on the dotted line, willing to pay the ultimate sacrifice for all Americans. We all owe them a debt of gratitude we’ll never be able to pay,” said Timothy Rich, Executive Director of Welcome Home, a homeless veterans organization in Columbia. Timothy watched Spc. Wyatt grow up, as Wyatt lived in the same neighborhood and participated in the same Boy Scout Troop as his son. After Sterling died, Timothy was one of several constituents who reached out to the Congresswoman’s office about naming the Columbia Post Office after him. “Those who fulfill that pledge and make that sacrifice – like Sterling Wyatt – deserve to be remembered and honored. We are deeply grateful for Congresswoman Hartzler’s effort to memorialize Sterling’s life for generations to come.”
Spc. Wyatt’s awards and decorations include the Medal of Valor, Bronze Star, National Defense Service Medal, Afghanistan Campaign Medal with campaign star, Global War on Terrorism Service Medal, Army Service Ribbon, Overseas Ribbon, NATO Medal, Certificate of Achievement, and Combat Infantryman Badge.
Congresswoman Hartzler chairs the Subcommittee on Oversight & Investigations on the House Armed Services Committee and represents Fort Leonard Wood and Whiteman Air Force Base in Missouri’s Fourth Congressional District.
Acting Chief Customer and Marketing Officer/Executive Vice President – Jacqueline Krage Strako
The Postmaster General and Chief Executive Officer, Megan J. Brennan, announced internally that Jacqueline (Jakki) Krage Strako will be detailed to the position of Chief Customer and Marketing Officer and Executive Vice President, effective February 3. Here is an excerpt of the announcement:
In her new assignment, Jakki will be responsible for developing and executing strategies that align with customers so that we can more effectively meet their needs in an increasingly digital and rapidly evolving marketplace. She will drive our product development and marketing, industry engagement, as well as sales and customer care.
Jakki’s 28-year postal career has spanned operations, finance, budget, and industrial engineering. Throughout her career she has been a passionate advocate for the customer, and an effective leader, strategist, and problem solver. She brings a deep understanding of the organization, our customers, and the marketplace to this important role. She has been instrumental in managing and strengthening relationships with many of our largest customers and business partners, and in delivering excellent results for our organization.
Please join me in congratulating Jakki and offering her your continued support in her new assignment.
Chief Customer and Marketing Officer/Executive Vice President – Jim Cochrane Retiring
January 3, 2018
The Postmaster General and Chief Executive Officer, Megan J. Brennan, announced internally the upcoming retirement of Jim Cochrane. Here is an excerpt of the announcement:
After more than 43 years of exceptional leadership, service, and accomplishment James (Jim) P. Cochrane will begin a new chapter in his life as a postal retiree beginning February 2.
Jim has had a lasting impact on the Postal Service and the mailing and shipping industry. In his recent roles as Chief Customer and Marketing Officer, and Chief Information Officer, and in numerous prior roles in Operations, Sales, Marketing, and Information Technology, he has been an innovative leader, anticipating our business challenges, identifying growth opportunities, and formulating and executing strategies to improve our ability to compete for customers.
Throughout his career, Jim has been a tireless advocate for the customer, and for improving the experience every customer has with us. Jim has actively engaged and collaborated with our business partners in the industry, and played a vital, leading role in strengthening these important relationships.
Please join me in wishing Jim a long, healthy, and happy retirement.
November 21, 2016
Competitive Product Price Change Approval
Friday November 18, the Postal Regulatory Commission (PRC) issued a decision regarding the Competitive Products Price Changes case. In the PRC’s orders, it approved the USPS to proceed with implementation of the January 2017 Price Changes as proposed in October 2016 for: Competitive Products.
For a copy of the PRC’s complete ruling, it can be found at: http://www.prc.gov/docs/97/97886/Order%20No.%203622.pdf.
Share Mail Workshop-in-a-Box
Like referral marketing, Share Mail is a Single-Piece First-Class Mail product that allows a business to send/distribute an offer or promotional information to its customers that can be forwarded to other individuals through the mail. This workshop covers required program elements, examples, pricing and payment options, and information on enrollment for the Share Mail program.
Please share this information with your members using the attached PCC workshop-in-a-box presentation. If you have any questions about this presentation, please email PCC@usps.gov.
A PDF copy of the presentation with note pages is posted on RIBBS: CLICK HERE
A PowerPoint copy of the presentation and recorded webinar by the subject matter expert on Share Mail is posted on the PCC BlueShare site (Postal internal access only): CLICK HERE
The PCC workshop-in-a-box program gives PCCs the ability to provide educational information and material to their members.
November 15, 2016
U.S. Postal Service Reports Fiscal Year 2016 Results
WASHINGTON–After accounting for a $5.8 billion retiree health benefit prefunding obligation, the U.S. Postal Service posted a net loss of approximately $5.6 billion for fiscal year 2016 (October 1, 2015 -September30, 2016), as compared to a $5.1 billion net loss for the year ended September 30, 2015.Excluding this prefunding obligation, the Postal Service would have recorded net income of approximately $200 million in 2016.
“To drive growth in revenue and better serve our customers, we continue to invest in the future of the Postal Service by leveraging technology, improving processes and adjusting our network,” said Postmaster General and CEO Megan J. Brennan. “In 2016, we invested $1.4 billion, an increase of $206 million over 2015, to fund some of our much-needed building improvements, vehicles, equipment and other capital projects.”
The Shipping and Packages business continued its strong performance with revenue growth of $2.4 billion, or 15.8 percent. This was offset by a decline in First-Class Mail revenue of $925 million, or 3.3 percent, due largely to the exigent surcharge expiration and continuing electronic migration. These two trends, together with steady standard or advertising mail revenues, and a slight increase in other revenues account for the $1.6 billion growth in operating revenue.
“The Postal Service continues to win e-commerce customers and grow our package delivery business. We deliver more e-commerce packages to the home than any other shipper because of our predictable service, enhanced visibility and competitive pricing,” said Brennan.
Overall, the Postal Service reported operating revenue of $70.4 billion for 2016, excluding a $1.1 billion change in accounting estimate recorded during the year. This equates to an increase of $1.6 billion, or 2.3 percent, over last year (See Selected 2016 Results of Operations table below). Revenue growth was achieved despite the April 2016 expiration of the exigent surcharge mandated by the Postal Regulatory Commission. As a result of this expiration, revenue for 2016 was lower by approximately $1 billion than what it otherwise would have been. Going forward, without the surcharge, the Postal Service expects its revenue to decline from what it otherwise would be by almost $2 billion per year.
Despite the positive trends in some aspects of its business, the net loss suffered by the Postal Service this year cannot be ignored. Even with continued proactive and aggressive management, such losses are likely to persist for the foreseeable future because of mandated costs such as an unaffordable retiree health benefits program that is not fully integrated with Medicare, and an ineffective pricing system.
“This is why legislative and regulatory reforms remain critical for us to meet the needs of the American public now and well into the future,” said Brennan.
Operating expenses increased in 2016 compared to last year. In addition to a $922 million increase in workers’ compensation expense, compensation and benefits expenses increased by approximately $1.2 billion and transportation costs increased by$413 million. The growth in labor and transportation costs is largely due to the increase in Shipping and Packages volumes, which are more labor-intensive to process and require greater transportation capacity than mail. Transportation expense also increased to significantly improve service levels in 2016.
Controllable income for 2016 was $610 million compared to $1.2 billion for last year. In the day-to-day operation of its business, the Postal Service focuses on controllable income, which takes into account the impact of operational expenses including compensation and benefits; but does not reflect factors such as the legally-mandated expense to prefund retiree health benefits or the change in accounting estimate noted above (see Controllable Income below for a full description).
FY 2016 Revenue and Volume by Service Category Compared to Last Year
The following presents revenue and volume by category for the years ended September 30, 2016, and 2015:
|(revenue in $ millions; volume in millions of pieces)||2016||2015||2016||2015|
|Shipping and Packages||17,307||14,942||5,134||4,510|
|Total before change in accounting estimate||$||70,368||$||68,790||153,941||154,035|
|Change in accounting estimate||1,061||—||—||—|
|Total revenue and volume||$||71,429||$||68,790||153,941||154,035|
Selected FY 2016 Results of Operations and Change in Accounting Estimate
During the three months ended June 30, 2016, the Postal Service revised the estimation technique utilized to determine its Deferred revenue-prepaid postage liability for a series of postage stamps. The change resulted from new information regarding customers’ retention and usage habits of Forever Stamps, and enabled the Postal Service to update its estimate of usage and “breakage” (representing stamps that will never be used for mailing due to loss, damage or stamp collection).
As a result of this change in estimate, the Postal Service recorded a decrease in its Deferred revenue-prepaid postage liability as of June 30, 2016, which caused an increase in revenue and decrease in net loss of $1.1 billion for the three months ended June 30, 2016, and for the year ended September 30, 2016. This change in accounting estimate resulted in a non-cash adjustment that does not impact the Postal Service’s liquidity or access to cash and does not affect its controllable income.
This news release references operating revenue before the change in accounting estimate and operating revenue before the temporary exigent surcharge, which are not calculated and presented in accordance with accounting principles generally accepted in the United States (GAAP).
The following reconciles these non-GAAP operating revenue calculations with GAAP net loss for the years ended September 30, 2016, and 2015:
|(results in $ millions)||2016||2015|
|Operating revenue before temporary exigent surcharge||$||69,232||$||66,672|
|Temporary exigent surcharge*||1,136||2,118|
|Operating revenue after exigent surcharge before change in accounting estimate||$||70,368||$||68,790|
|Change in accounting estimate||1,061||—|
|Total operating revenue||$||71,429||$||68,790|
|Other interest (income) expense, net||190||162|
|* The temporary exigent surcharge expired on April 10, 2016.|
This news release references controllable income, which is not calculated and presented in accordance with GAAP. Controllable income is a non-GAAP financial measure defined as net income (loss) adjusted for items outside of management’s control and non-recurring items. These adjustments include the mandated prefunding of retirement health benefits, actuarial revaluation of retirement liabilities, non-cash workers’ compensation adjustments and the change in accounting estimate.
The following reconciles GAAP net loss to controllable income and illustrates the income from ongoing business activities without the impact of non-controllable and non-recurring items for the years ended September 30, 2016, and 2015:
|(in $ millions)||2016||2015|
|PSRHBF prefunding expense||5,800||5,700|
|Change in workers’ compensation liability due to fluctuations in discount rates||1,026||809|
|Other change in workers’ compensation liability1||188||(502||)|
|Actuarial revaluation of retirement liability2||248||241|
|Change in accounting estimate||(1,061||)||—|
|1 This is a net amount that includes changes in assumptions, as well as the valuation of new claims and revaluation of existing claims, less claim payments for the applicable periods.|
|2 Determined by OPM in 2015 to amortize the $3.6 billion unfunded FERS retirement obligation based on actuarial valuations and assumptions. The payments are to be made in equal installments over the next 30 years.|
Complete financial results are available in the Form 10-K, available at http://about.usps.com/who-we-are/financials/welcome.htm.
Marketing, DPMG Groups Re-aligned
USPS is making changes within its Marketing and Deputy Postmaster General organizations to better serve customers.
“Although the entire organization is responsible for delivering excellent service and customer experiences, the following changes will sharpen our focus to more effectively reach and engage our customers, and bring their voices and rising expectations more prominently into our strategy development,” PMG Megan J. Brennan wrote in an Oct. 20 memo.
Additionally, within the DPMG organization, DPMG Ron Stroman will continue to oversee Government Relations, Sustainability and Office of the Judicial Officer. He also will lead international efforts that involve public policy and oversee International Postal Affairs, a new function within his group.
The changes take effect Oct. 20.
Please visit us on the USPS Industry Outreach website.
Thank you for your support of the United States Postal Service.
—Consumer and Industry Affairs
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Postal Service Announces 2017 Shipping Prices
Pricing Unchanged for Priority Mail International, First-Class Package
International and Priority Mail Express International Service
WASHINGTON — The U.S. Postal Service today filed notice with the Postal Regulatory Commission (PRC) of price changes for Shipping Services products to take effect next year, following the end of the holiday mailing season. The filing does not include any price increase for First-Class Package International Service, Priority Mail Express International and Priority Mail International.
The Postal Service continues to provide excellent value and reliability for the shipping industry, along with convenient choices for consumers. The average Shipping Services price change is 3.9 percent, which results in an average shipping price of less than $5 per shipment across all shipping products.
The new prices, if approved, represent a modest price increase in Priority Mail by 3.9 percent and an average of 3.3 percent in Priority Mail Retail prices.
The Priority Mail Flat Rate Box and Priority Mail Flat Rate Envelope prices for these products are:
|Small flat-rate box||$6.80||$7.15|
|Medium flat-rate box||13.45||13.60|
|Large flat-rate box||18.75||18.85|
|Large APO/FPO flat-rate box||16.75||17.35|
|Regular flat-rate envelope||6.45||6.65|
|Legal flat-rate envelope||6.45||6.95|
|Padded flat-rate envelope||6.80||7.20|
The PRC will review the prices before they are scheduled to take effect Jan. 22, 2017. The complete Postal Service price filing with the new prices for all Shipping Services products can be found on the PRC site under the Daily Listings section: http://www.prc.gov/dockets/daily.
The Postal Service receives no tax dollars for operating expenses and relies on the sale of postage, products and services to fund its operations.
Please visit us on the USPS Industry Outreach website.
Thank you for your support of the United States Postal Service.
—Consumer and Industry Affairs
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Forced Price Reduction to Worsen USPS Financial Condition by $2 Billion Per Year
Postal Service Exigent Surcharge Pricing to End April 10
WASHINGTON — Absent Congressional or court action to extend or make permanent an existing exigent surcharge for mailing products and services – including the Forever stamp — the Postal Service will be required to reduce certain prices on Sunday, April 10, 2016. This mandatory action will worsen the Postal Service’s financial condition by reducing revenue and increasing its net losses by approximately $2 billion per year.
“The exigent surcharge granted to the Postal Service last year only partially alleviated our extreme multi-year revenue declines resulting from the Great Recession, which exceeded $7 billion in 2009 alone,” said Postmaster General and CEO Megan J. Brennan. “Removing the surcharge and reducing our prices is an irrational outcome considering the Postal Service’s precarious financial condition.”