The US post office could cut mail delivery to three days a week and it wouldn’t matter

February 7, 2013
February 7, 2013

The US Postal Service now plans to cut back first-class mail delivery to five days a week, as it struggles to slash losses that hit $16 billion last year. But it could trim service further to just three days a week, and it would make little difference.

The postal service chiefly delivers two kinds of things: packages and letters. The packages are increasingly being delivered these days by online retailers and private services. Amazon.com’s Local Express Delivery provides same-day delivery in 10 American cities, and is available seven days a week in some of them, for just $3.99 per item if you sign up for its Prime service. Amazon will surely expand this to more places and reduce the cost, while other private delivery services emerge and grow as well.

As for letters, the internet is better for all essential communications. Email replaces personal letters, online notifications replace bills. A printed greeting card is still nice to get, but, as long as you plan ahead, those aren’t urgent mail. US first-class mail volumes peaked around the year 2000 (pdf, slide 5), and have been falling steadily since. Standard mail peaked more recently, but has since fallen sharply. If mail delivery were cut back further, it would have the beneficial effect of pushing more people towards more efficient digital transactions and payments.

Under the current plan, to take effect in August, the postal service will continue to deliver packages and prescription drugs on Saturdays. It could maintain some level of essential delivery service every day. That’s one way to avoid hurting people who don’t have good online access or digital fluency. Everything else can be delivered less frequently.

Dropping first-class mail delivery to three days a week was one of the options presented by consultants at McKinsey (slide 34) in 2010 as part of its work with the Postal Service in 2010. It’s time to start moving toward that.

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