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Mailers Webinar Feb 2012

Mailers Webinar Feb 2012

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Published by bsheehan

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Published by: bsheehan on Feb 13, 2012
Copyright:Attribution Non-commercial


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USPS Financial Future
Responsibly Realigning Our Network
February 2012
VolumeVolumePricePriceLabor CostsLabor CostsUniversal ServiceUniversal ServiceObligationObligation
Capped by inflation
Price elasticitiesare in fluxdue to growing alternativesPostal network driven by:
Delivery points
Retail locations
Sortation facilities
Six-day delivery
~80% of total costs
COLA increases
Benefits: pensions, retireehealth, health insurance
Limited flexibility
Retiree prefundingobligation, rising workers’compensation costs
These trends willThese trends willcontinue to putcontinue to putpressure onpressure onUSPSUSPSssability to provideability to provideaffordable universalaffordable universalserviceservice
Transactional volumedeclining due to e-diversion
Advertising mail is subjectto more substitution options
Mail volume highly sensitiveto economic changes
Mail mix changes – lost profit contributions
Fixed CostFixed CostBaseBaseRising butRising butcappedcappedRising CostRising Costper hourper hour
Situation Assessment: Mail
Mail Volume Shifting to Less Profitable Mix
Volume in Billions of Pieces
9878533902550751001252006 2010 2016 202010383828102550751001252006 2010 2016 2020
First-Class MailStandard Mail

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