Postal Service narrows branch consolidation list to 241

Less than a week after the US Postal Service disclosed that it incurred a $3.8 billion net loss for fiscal year 2009, it narrowed the list of branches it is considering closing by 130. The agency is still reviewing the possible closure of 241 post offices as of November 20.

The branches are mostly in urban and suburban areas, a tactic the USPS says will help it determine where “consolidations might be feasible without compromising customer access to postal services.”

The Postal Service is considering closing 13 stations in Atlanta, eight in Washington, DC, six in New York and five in Orlando, FL.

The process began this summer and initially examined the possible consolidation of 3,600 branches. The agency reduced that number to 371 branches last month, and 413 in early September.

Industry experts have told DMNews that the consolidations are unlikely to drastically affect direct mailers.

This week, the Postal Service disclosed a nearly 9.1% drop in FY 2009 operating revenue to $68.1 billion from $74.9 billion last year. The agency said it cut operating expenses by nearly $6 billion for the fiscal year, which ended September 30. The USPS saw a decline of more than 25 billion mail pieces, or 12.7%, for fiscal 2009. Legislation passed this fall allowed the USPS to delay $4 billion in payments to a retirees’ healthcare fund.

The agency is also predicting a revenue decline of $2.2 billion for fiscal year 2010, as well as a net loss of $7.8 billion, cost reductions of more than $3.5 billion and a reduction in mail volume of about 11 billion pieces. John Potter, USPS postmaster general and CEO, said during a recent USPS Board of Governors meeting that structural reform of the agency should reduce the number of delivery days per week from six to five to cut costs.

The agency told businesses last month that it would not raise rates on its market-dominant products, which are generally used by direct marketers and direct mailers.

Related Posts