USPS paid FedEx $1.37 billion in 2010

Husch Blackwell’s Postal Service Contracting practice group today released its list of the top 150 U.S. Postal Service suppliers for fiscal year 2010, and for the eighth straight year FedEx claimed the No. 1 spot with Northrop Grumman jumping from fourth to second. The list is compiled by David P. Hendel, a partner in the firm who has served clients’ postal contracting needs for 29 years. This is the 15th year for the list.

First-place FedEx transports Express, Priority and First Class Mail, and earned postal revenues of $1.372 billion in fiscal 2010 – falling slightly from the $1.4 billion it earned in fiscal 2009. Another postal competitor, United Parcel Service, is the Postal Service’s 11th largest postal supplier, earning $95 million in revenue – a $12 million increase from last year.

“Once again, transportation and technology providers stand atop the list of the Postal Service’s largest suppliers,” said Hendel, who compiles the list from information obtained under the Freedom of Information Act. “But unlike last year, in fiscal 2010 more top suppliers had declines rather than gains in postal revenues.” The sharp decline seen in postal spending over the previous several years has stabilized; spending in FY 2010 totaled $12 billion, a 1 percent decrease over FY 2009. By contrast, postal spending in FY 2009 declined more 19 percent from FY 2008.

Second-place automation supplier Northrop Grumman earned $494 million in postal revenues. Northrop Grumman provides automation design, equipment fabrication, field deployment and logistics support to the Postal Service.

Other companies in the top 10 include third-ranked Kalitta Air, an air transportation and mail distribution service for military mail bound for Iraq and Afghanistan; trucking contractor Pat Salmon & Sons, Inc. in fourth place; systems manufacturer Siemens in fifth; computer company Hewlett-Packard in sixth; transportation company Wheeler Bros., Inc. in seventh; advertising agency Campbell-Ewald in eighth; consulting company Accenture in ninth; and the number 10 spot was secured by technology company IBM.

“Opportunities for facility contractors continue to decline in 2011 as the agency is unlikely to build many new facilities in a time of decreasing mail volume,” Hendel said. “But opportunities do exist for modifying existing facilities and retrofitting facilities for energy conservation purposes.”

Other trends identified in FY 2010 figures:

* Increased spending on ground transportation – up 5.3 percent from FY 2009
* Decreased spending on domestic air transportation – down 2 percent
* Decreased spending on international air transportation – down 26 percent
* Spending on supplies and services remained stable

Click here to view the full list of the top 150 suppliers to the U.S. Postal Service in 2010.

The firm’s Postal Service Contracting group assists clients in contracting with the U.S. Postal Service, and its members are knowledgeable regarding the needs specific to the postal industry. Hendel has developed and presented several training courses on postal contracting. He also writes a monthly column on postal contracting issues for the National Star Route Mail Contractors Association. He has represented hundreds of postal contractors on a wide range of issues.