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Contractors are antidote to US Postal Service's billion-dollar losses

Posted by | Apr 18, 2008 | |

Last year, the U.S. Postal Service lost USD 5 billion.

The Postal Service used to be able to simply raise stamp prices to deal with financial trouble. The cost of a First Class stamp has risen more than 30 percent in the past ten years.

But thanks to reform legislation passed in 2006 which limits postage increases for monopoly products to the annual rate of inflation, the Postal Service can no longer rely on ordinary stamp-buyers to balance its ledger.

And although USPS revenues are climbing each year, they’re unlikely to climb high enough to get the agency out of the red, given current trends. First Class mail volume is declining, and higher prices will only exacerbate that trend.

To right the ship, the Postal Service must cut spending. Since labor costs account for a full 80 percent of the Postal Service’s expenses, they’re the best place to start.

Private contractors can and should play a role in bringing down these costs. Clearly, Postal Service management has recognized this, as it has made outsourcing and contracting a major component in its strategy to keep costs under control.

The Postal Service mostly uses contractors for new routes. And there’s plenty of work to go around. Each year, 1.8 million delivery points are added to the mail network, mostly in rural areas.

The Postal Service is now looking to contract with the private sector to sort and transport bulk mail and parcels. Currently, a national network of USPS facilities manages these tasks. The prospect of private firms taking on these duties has elicited heated responses from the leaders of postal labor unions, but employing contractors for both sorting and delivery could do wonders to help USPS keep costs under control.

In the last round of union negotiations, management agreed to a temporary moratorium on outsourcing, under the assumption that a more permanent arrangement would be worked out in future negations.

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USPS launches rate increases and incentives

Posted by | Apr 18, 2008 | |

Under a new strategy intended to make it more competitive with other shipping companies, the U.S. Postal Service is rolling out a new rate schedule effective May 12 with a combination of higher rates and incentives for lowering costs.
Taking advantage of a law passed by Congress in 2006 that gives the U.S.P.S. increased flexibility to set prices, the Postal Service will offer zone-based pricing with lower rates for those who ship in volume or help the Postal Service cut costs by dropping off packages at bulk mail centers.
Shipping rates for Priority Mail and Parcel Select, two U.S.P.S. services commonly used by online retailers to ship parcels weighing up to 70 pounds, will rise on average 6 pct and 5.7 pct, respectively. But Priority Mail, used to deliver products typically within two to three days, will offer lower rates to shippers who use services such as the Postal Services’ online Click-and-Ship pick-up scheduling service and PC Postage online postage services from third-party vendors like Endicia and Pitney Bowes, the spokesman says.
For Parcel Select, which allows shippers to bring products to either a local post office or a bulk mail center, customers will be able to get reduced rates based on volume and also for bringing packages directly to a post office, or direct delivery unit, instead of a bulk mail center.
For package returns, the U.S.P.S. is raising the average overall rate by 2.2%. But it will offer discounts for packages returned to a direct delivery unit instead of a bulk mail center, the spokesman says.

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Posteurop visits Haypost

Posted by | Apr 18, 2008 | |

The Chairman of PostEurop Mr. Bernard Damiens, and the Secretary General of PostEurop Mr. Ingemar Persson will pay a visit to HayPost on April 15 and 16. The purpose of their visit will be to introduce PostEurop action plans to HayPost. The leaders of PostEurop will meet with HayPost management and several key ministers during their two-day visit to become acquainted with the transformation progresses of HayPost and to identify key cooperation and strategic programs for European postal integration.

As part of its objectives of building HayPost into a world-leading postal and financial service company, HayPost formally became the 45th member of PostEurop – an Association of 48 European public postal operators with the intention to optimize postal operations and postal services in Europe, and to foster greater cooperation between its Members. As a new member of PostEurop, HayPost will acquire lessons from the PostEurop networking tools to quickly improve the quality and standards of its services.

The leaders of PostEurop will participate in officially launching the new HayPost Training Center on April 15 developed with the purpose of increasing the quality of HayPost’s human capital, followed by an official opening of the newly renovated post office No. 68 on April 16.

The PostEurop Chairman and Secretary General will also personally meet with RA Minister of Trade and Economic Development, Nerses Yeritsyan, and State Property Management Head, Karine Kirakosyan, as well as meet with HayPost management and staff.

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UK keeps a digital distance

Posted by | Apr 18, 2008 | |

Whether it is sacking staff by text message or dumping your partner by email, digital communication has made us a nation of cowards, according to a new report out today from Post Office Telecoms.

The findings show that many UK residents are maintaining that famous British reserve by relying on text messages and email to get themselves out of sticky situations – with 73 per cent of people admitting to delegating difficult tasks at work by email and text, and 52 per cent using these forms of technology to contact new business prospects.

The report shows that one in four young people* think it is appropriate to call into work sick via email or text message, with one in seven admitting to having done so in the last 12 months. It also reveals that 3 per cent of UK adults even admit to ending a relationship by text message in the last year.

The report, called ‘Etiquette in the Digital Age’, is authored by etiquette expert Liz Brewer, whose credits include ITV’s ‘Ladette to Lady’.

Stewart Fox-Mills, head of telephony at the Post Office, said: “Digital technology is constantly giving us new ways to communicate, which enriches our day to day lives. But we’ve found that many people are in fact using modem technology to keep a ‘digital distance’ and avoid face-to-face or verbal confrontation.

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Omega United Acquires SkyPostal, Inc.

Posted by | Apr 18, 2008 | |

Omega United, Inc. has acquired SkyPostal, Inc., in a move to change its corporate strategy and direction. Omega will cease its previous business activities and file to change its name to SkyPostal Networks, Inc.

“Going public through this merger is the next step in our evolution, as SkyPostal strives to become the dominant mail distribution company in Latin America, the Caribbean and Mexico (‘LAC’),” stated Albert P. Hernandez, SkyPostal’s President and CEO. Mr. Hernandez went on to say, “We are now in a position to implement an aggressive growth strategy that features internal growth as well as growth through the acquisition of key postal delivery companies within the region. The highly fragmented postal delivery industry in the LAC region is ripe for consolidation and offers economies of scale related to cost reduction and the elimination of redundant services. The market is ideal for the application of current technologies, standardization of operating systems and the region-wide development of the SkyPostal brand.”

SkyPostal is one of the largest facilitators of mail delivery from Europe and the US into LAC, for major European postal administrations and the leading mail consolidators, delivering more than 150 tons of mail per month into the region. The Company has exclusive agreements in place with over 20 major private postal services in 20 different countries throughout the LAC region for the delivery of commercial mail, periodicals and parcel post.

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Deutsche Post's DHL struggles with delays new Leipzig hub

Posted by | Apr 18, 2008 | |

Deutsche Post World Net AG’s express unit, DHL, is struggling with delays at its new cargo hub in Leipzig, Die Welt reported, citing pilots’ comments in internet forums.
The newspaper quoted a spokesman for the German mail services company as saying everything is going according to plan.
Deutsche Post plans to inaugurate the 300 million euro Leipzig hub, its third global hub after Hong Kong and Wilmington, United States, officially on May 26.
The report said pilots have claimed that ground staff at the new hub has not yet been sufficiently trained.
It alleged some flights have been redirected to Brussels, DHL’s previous hub.
The start-up of DHL’s Wilmington hub was delayed by several months, putting pressure on the start of Deutsche Post’s U.S. express operations, which have posted unspecified losses since the company entered the market in 2004.

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John Acton appointed Managing Director of DPD

Posted by | Apr 18, 2008 | |

The supervisory board of DPD GmbH, Aschaffenburg, announces the appointment of Briton John Acton (43) to Managing Director of the international provider of standard and express parcel services. After the departure of CEO Hans Fluri in March this means that the top management of the international franchise organisation has been completed from within the company’s own ranks. At the head of the DPD franchise system Mr Acton will form a two-man team with Arnold Schroven, who is also at the helm of DPD GeoPost (Germany).

In addition to his appointment as Managing Director of DPD Mr Acton is Chief Marketing and Strategic Accounts Officer at GeoPost, and is a member of the Direction Générale of GeoPost

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TNT Indonesia hoping for 50 pct increase in cargo

Posted by | Apr 17, 2008 | |

TNT has recently begun using the Boeing 747-400 ER Freighter, with a payload capacity of 110 tons, to serve its Southeast Asian, Chinese and European markets.

With four new Boeing 747-400 ER Freighters being put into operation last week, TNT now has a fleet of 51 aircraft.

“A Boeing 747-400 ER Freighter can fly directly from Europe to Singapore, traveling around 13,000 kilometers without transit,” TNT Indonesia sales and marketing manager Andry Adiwinarso said at a press conference Wednesday.

The new freighters, the largest in Asia, do not fly direct to Indonesia, Andry said.

Indonesia transports cargo every day to Singapore with feeder aircraft leased from the Malaysian based cargo airline Transmile via Jakarta and Balikpapan, he said.

“Indonesian freight served by TNT grows each year by around 15 to 20 percent. With the new large aircraft now available, we’re expecting the amount to increase by up to 50 percent a year,” he said.

Indonesia received around USD 188 billion from export and import trading last year, said Mahendra Siregar, a deputy to the Coordinating Minister for the Economy.

The main export commodities included electrical equipment, textiles and machinery.

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