Monday, November 30, 2009

Choosing a Mail Industry Policy

In choosing a potential business model for the Postal Service, policymakers are as much choosing a path for the entire industry within which the Postal Service operates as choosing a path for the Postal Service itself. The United States Postal Service is only one supplier within a much larger communications and parcel delivery market.This industry supplies households, businesses, government entities, and other organizations that need to:
  • Solicit, conduct, and complete transactions;
  • Distribute advertising, news, and other types of information;
  • Communicate with friends, family, and business associates; and
  • Deliver packets and parcels.
The public face of the Postal Service is its service to individual citizens through its 6-day delivery service and local retail post offices. However, the survival of the Postal Service, and for that matter the ability of individuals, governments, non-profits, and businesses to send hard-copy communications and parcels rests on the Postal Service’s ability to serve the business customers that generate over 88% of all revenue, a proportion which has grown as increasingly individuals have chosen electronic alternatives offering more convenient and cost-effective solutions. With non-household derived revenue likely to determine the long-term viability of the Postal Service, policy makers need to focus on ensuring that the future business model of the Postal Service can provide non-household mailers with a positive return on their mail spending in order that there is sufficient volume in the system to make the continuing use of mail by the general public affordable, reliable, and convenient.

Executive Summary Part 1: Choosing a Mail Industry Policy (this post)
Executive Summary Part 2: Challenges facing all Business Models
Executive Summary Part 3: Potential Business Models

Full Paper: Examination of Potential Business Models

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