Real Postal Story About More than Finances, Its About Reform
Wednesday, March 28, 2001
3/28/01 - "You've heard that the Postal Service may lose $2 billion to $3 billion this year," PMG Bill Henderson told mailers at the National Postal Forum during his keynote address in Orlando this morning. "But the real story is about more than just finances. Our bottom line is only the symptom of a larger problem — a regulatory model that does not provide the Postal Service with the flexibility it needs to succeed in a radically changing market. "Your success is, in large part, depends on our success," Henderson said. "Affordable universal mail service is what you expect. It's something we want to deliver. But delivering it will become increasingly difficult." The PMG said that an economic environment that promised good things for the mailing industry last fall has failed to deliver on that promise. Not only has the technology sector taken a beating, he said, the pain has spread to traditional businesses. "Each of you is trying to do more with less," he said. "In pursuing that goal, you have the ability to adapt. You have the tools we do not." He said costs are increasing faster than inflation, third-party arbitration decisions and automatic pay increases mean USPS has little control over some labor costs and, therefore, little control over pricing. "Diminishing growth in First-Class Mail, coupled with higher growth in lower-priced standard mail, has hindered our revenue growth," the PMG said. "At the same time, the Postal Rate Commission reduced our revenue request by a billion dollars in our last filing." "Unfortunately, our hands are tied when it comes to some types of innovation," he said. "We can't change prices in response to market changes," offer discounts during slack operational time, or introduce new products and services without months of preparation and hearings.