Postal Service to experiment with PO box strategy

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The US Postal Service, which this month revealed its 10-year plan to return to financial stability, will seek permission to change the classification of some consumer post office boxes. The move, which requires approval from the Postal Regulatory Commission, would free the USPS from pricing the boxes based on the rate of inflation.

The agency wants to reorganize about 32,000 boxes in 49 post offices, totaling less than 1% of all USPS boxes. Each affected PO box is within a half-mile of a competing company. The strategy would shift some consumer post office boxes to the “competitive” category from the “market dominant” classification. The move would give the USPS more flexibility with price increases and consumer-facing services at a time when it is seeking to increase revenue and cut costs.

The USPS classifies products that other companies offer as “competitive,” while services that it only offers are considered “market dominant.”

The affected post office boxes are in “higher-cost and higher-density population areas,” according to Greg Frey, spokesperson for the USPS.

“This is important long-term so that we are able to respond more competitively to the needs of our customers,” he said. “The reality is that the market has changed, and now we have competitors within a half-mile of each of these locations.”

Earlier this month, John Potter, CEO and postmaster general of the USPS, introduced a 10-year plan including cost-cutting and productivity measures, a transition to a five-day home delivery schedule and an exigent price increase. The agency, which saw a net loss of $3.8 billion for FY 2009, is also planning a second “summer sale” this year, as well as determining what post office branches to close.

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