USPS isn’t interested in handling more cheap e-commerce shipments

The Wall Street Journal says last week’s announcement of higher USPS priority mail rates is an indication that the agency isn’t looking to increase its small package volume unless it can make it profitable:

The U.S. Postal Service doesn’t look any more interested than the private package carriers in handling more cheap e-commerce shipments. The USPS is looking for a 9.5% increase for commercial-package shipping rates and double-digit hikes in its bread-and-butter business of shipping packages weighing less than a pound, the WSJ’s Laura Stevens reports. The request to the Postal Rate Commission marks a complete turnaround from last year, when the Postal Service slashed rates for high-volume Priority Mail shippers. The lightweight end is the biggest concern for the USPS since postal officials say they make only a penny on those residential deliveries. Commercial customers may be more worried over the long term that the Postal Service, long a sanctuary for low-cost shipping, is so tightly focused on its per-package profitability.

Source: Today’s Top Supply Chain and Logistics News From WSJ – WSJ

  • Greed

    So I guess the Postal Service should operate at a loss on packages like it does with bulk business mail so as to bankrupt itself so private industry can increase their profit margin!

  • Roger Doger

    Funny how everyone wants the USPS to be run like a business. Then, when they do by raising rates to cover expenses, people complain. I’m sure it will still be less expensive to ship with USPS instead of UPS/FedEx

    Though you can’t get a real answer from the USPS because it’s Negotiated Service Agreement is private information. It’s reported that Amazon is only paying $2.50 per package. On Sunday’s, that no where comes close to covering the cost of the Carrier, Clerk, Mailhandlers and fuel to deliver them.

  • uncle bob

    How come when UPS and FEDEX raise their prices every year and still charge fuel surcharges and extra for saturday delivery, no on complains?

  • MrZip

    People just like to complain. If you gave them a $10 bill, they would complain that it wasn’t two $5’s. They’ll get over it. Although, we might see some of the “free shipping” disappear.