Expecting double-digit growth in package volume this holiday season, the U.S. Postal Service announced it would deliver packages seven days a week between November 17 and Christmas Day.
“The Postal Service will be out making deliveries every single day during the holiday season, including Christmas Day,” said Postmaster General Patrick Donahoe at an event introducing a Rudolph the Red Nosed Reindeer stamp this morning at the National Postal Museum. “During the holidays, no carrier makes more deliveries to more places than the Postal Service, and this year, we’re raising the bar with enhanced tracking and Sunday delivery.”
The package and shipping business is one of Donahoe’s priorities for growth at USPS. It currently owns the highest growth rate of all the Post Office’s lines of service at 8 to 11%, and its upside is enormous. This holiday season, the Postal Service projects 12% growth over last year and is poised to handle as many as 750 million packages.
A study released in July by the Office of the Inspector General of the U.S. Postal Service reported that the Postal Service accounts for almost two fifths of the total volume of the shipping business, but less than one fifth of the revenues. USPS’s focus on lightweight packages returns it a revenue-per-piece of $3.37 as compared to $9.70 for FedEx and $9.39 at UPS—for whom postal carriers provide last-mile delivery of light packages. The fact that the private carriers are out and about all week during the holidays obviously factored into the Postal Service’s decision.
USPS has gotten aggressive in trying to wrest market share from FedEx and UPS. Both of those companies have announced they will move to a dimensional rate scheme in 2015, which will charge for packages based on size instead of weight. The Postal Service aimed a direct mail campaign at small businesses assuring them they would stick to weight-based rates, and it lowered Priority Mail rates for business mailers.
“The Postal Service is a vital business partner for small and large businesses and lowering shipping prices will save them money and improve their bottom line,” said Nagisa Manabe, USPS’s chief marketing and sales officer.
The Postal Service issued the following deadlines for packages to reach their destinations by December 25:
December 2: First-Class Mail International and Priority Mail International
December 10: Priority Mail Express International
December 15: Standard Post
December 17: Global Express Guaranteed
December 20: First-Class Mail/Priority Mail (domestic)
December 23: Priority Mail Express (domestic)