OIG: USPS could save $4.5 billion by eliminating door to door deliveryThursday, July 14th, 2011
The US Postal Service’s Inspector General claims that the USPS could save more than $4.5 billion a year by eliminating door to door delivery:
The delivery operation is the Postal Serviceâ€™s largest cost center with mail delivery occurring 6 days a week. Door-to-door delivery is the most expensive mode of delivery, costing the Postal Service as much as $353 per delivery point, totaling $12 billion annually. Curbside delivery is more cost effective, because it allows the carrier to remain in the vehicle and deliver mail from the street to a mailbox or grouping of mailboxes. Furthermore, it lessens the possibility of carrier injuries such as falls, stress and strain on shoulder joints due to carrying a mail satchel, and dog bites. Centralized delivery is even more cost effective and efficient, because carriers deliver mail to a group or cluster of mail receptacles at one delivery point.
Converting existing door-to-door to curbside delivery could save the Postal Service more than $4.5 billion. If the Postal Service converted all delivery modes to centralized delivery, it could save an additional $5.1 billion.
But the IG admits that the suggestion is unlikely to be fully implemented:
We acknowledge it could be difficult to make these changes, as the Postal Service may never fully mitigate customersâ€™ resistance to eliminating an existing service.3 Likewise, we acknowledge some deliveries may never be candidates for conversion. On the other hand, the Postal Service must take every opportunity to cut these significant delivery costs.
As a starting point, the Postal Service could mandate centralized delivery for all new delivery points. We estimated the Postal Service could save more than $35 million if it took action to centralize new delivery points. See Appendix B for our detailed analysis of this topic and Appendix C for our calculation of monetary impact.