The U.S. Postal Service says it is prepared to handle the fall mailing challenge this year, even though it is expecting big volume increases over last year and experienced service problems in the spring.
Fall mailing plans, which were completed last month, took effect Saturday and will continue through Thanksgiving. They include updating facilities' action plans; adding seasonal employees; adding staff to the USPS' business services network, a project in which the postal service makes weekly contact with its national account customers to ensure that mailings are going smoothly; using new automated flat-sorting machines; and using an improved Drop-Ship Appointment System, which lets mailers make appointments to unload their trucks filled with direct mail at postal processing facilities.
Nick Barranca, USPS’ vice president of operations planning and processing, said the agency “is expecting a 5 percent increase in Standard-A mail volume over last year, but mailers are predicting even more.”
Major printers told Barranca and his group that there’s a migration back to mail from Internet advertising “because of some of the things they experienced last year.” Adding to that is more prospecting being done ahead of next year’s increase in postal rates.
Printers don’t think the rate case “will influence the business plan of mailers who use mail as part of their business strategy significantly,” Barranca said. “Lists will become more refined and mailing may become more targeted and more efficient, but they don't think there will be a significant change in Standard-A.”
This spring’s service problems, he said, stemmed from an unexpected increase in volume.
“We had a 7 percent growth between March and May in Standard-A volume versus only a 2 percent growth in the spring of 1999,” he said.
As a result, field managers at each of the 330 plant processing centers, 21 bulk mail centers and 85 districts were required to present plans assuring postal officials that their facilities were adequately prepared to handle the expected fall volume increases. The field managers had to make sure that each plant had a system in place for customer communications; a good understanding of what the mail volume will be in their center and how that matches up against capacity; the right amount of mail transport equipment; available contingencies in place to get extra equipment, if needed; and enough temporary and seasonal employees.
Barranca said the fall mailing flows should be improved over last year as a result of the new ASFM 100 sorting machines for flats, or catalog mailings, that are being deployed. ASFM 100s are more than twice as fast as the existing FSM 881s. As a result, they process flat mail more efficiently and reduce associated costs. By the end of the year, the USPS will have 175 of these sorters in the system.
“They have a higher through-put and they are faster,” he said, “and we are getting anywhere from 14,000 to 16,000 pieces per hour through the equipment.”
Officials expect the sorters to be key for a successful fall season, since “the fall mail category is where we typically have had problems, because this type of mail is harder to sort,” Barranca said.
As for the Drop-Ship Appointment System, improvements include allowing mailers that make a drop-ship appointment at a site to receive a history of how well that site has been performing and processing mail.
“Mailers can make any adjustments in their entry plans if the site might be having a 24-hour delay,” Barranca said.
The system became Web-enabled last year, but there were initial problems with it during the fall because of capacity, Barranca said. Those problems have been solved. This year, mailers also are using their in-home delivery guidelines in concert with the system to plan their mailings.
Mail transport equipment, which often proves to be the biggest headache for mailers this time of year, should be in good shape. There is more equipment — such as large and small sacks — and the MTE Service Center network is fully operational, which Barranca said helps manage the inventory better.
Finally, as in past fall mailing seasons, the USPS will monitor performance at key points, particularly at the BMCs, plants and delivery units. But this year, officials will monitor the Drop-Ship Appointment System even more closely for mailings entered late at the in-home window or appointments not being kept. It also will use its Advance system, which tracks delivery information about Standard-A mail bundles, to determine the agency's on-time percentage.
Despite the plans, mailers are skeptical.
“We need to keep a close watch on delivery this fall,” said Joe Schick, director of postal affairs at Quad/Graphics Inc., West Allis, WI, whose company delivers mail for companies such as L.L. Bean, Lands' End, Lillian Vernon and Fingerhut. “In March and April, we had some real delivery problems.”
Schick said he also is concerned about the postal service’s cost-cutting programs. In September, for example, the agency will cut 600 administrative jobs as part of 20,000 postal jobs it will eliminate to remove $100 million in costs from each of the next four fiscal years.
While these jobs are not in field operations now, they may be in the future, and “we know that when the USPS is in a cost-cutting mode, it impacts service,” Schick said.
Barranca said the initial stage of reducing administrative costs is not aimed at field managers.
Regardless, Schick said, “It is not assuring that we've had problems, coupled with the cost-saving stuff. … We're going into a pretty fragile fall. And the volumes could be pretty heavy this fall, and not just from a Standard-A point. We've got the Olympics and elections, and magazines are getting a lot more advertising, so they are heavier, which equates to more packages and containers.”