How the Post Office Can Make Money and Survive
Filed under: Banking, Extracurriculars, Insurance, Video, Credit Cards, In the News
The United States Postal Service is nosediving. In its last fiscal year, it lost $8.5 billion, which was $4.7 billion more than the year before. In an attempt to stem some of the losses, it's planning on hiking rates in April. With the use of postal mail dwindling, America's massive infrastructure of post offices can remain useful by imitating the diversity of products sold by the Post Office of the United Kingdom. I traveled there, where the local Post Office is innovating its services to stay relevant to its citizens.
Like America's Postal Service, the British Post Office is declining, too, partly under onerous pension expenses, but it's been proactive in trying to keep the system relevant for a changing society. The head of it, Ed Davey, recently pledged to "expand its financial services and become a genuine front office for local and national Government."
Should America do the same? Post offices are a national asset without equal. There are some 36,000 branches of the post office across America. Imagine if you could use your local post office as a one-stop shop for banking, bill paying, insurance, and a variety of government services. If the U.S. Mail's storefronts partnered with a suite of extra services to make extra money and create a more convenient storefront for Americans, what would it look like?
A lot like Great Britain, as the video shows.
Our Postal Service is an independent branch of the government -- technically, the Executive Branch. Our mail system has not received taxpayer dollars since the early 1980s, which is why as snail mail use sags, the postal rate skyrockets.
In recent years, increasingly burdened by over staffing, the U.S.P.S. has tried to increase revenue by aggressively "upselling" customers with add-ons such as insurance and delivery confirmation, but it hasn't taken the bolder step of partnering with a wide array of government and banking institutions to make government-related chores easier for Americans.
With American financial institutions writhing in the mud, soiled by scandal and bailouts, the time may have arrived for a new national banking institution to step in. While our post offices could partner with major brands, perhaps the better tactic would be to create its own guaranteed Post Office-branded bank, which could issue many of the same services as the British version does through its network.
Britain, which like us has been closing branches in recent years, just wrestled with the idea of creating a government-backed "Post Office Bank" that would draw customers to the Post Office. The idea had been growing in popularity for years, but it was scrapped for now out of recession-related concerns. The cash-strapped government has also started privatizing portions of the Royal Mail service.
Like America's Postal Service, the British Post Office is declining, too, partly under onerous pension expenses, but it's been proactive in trying to keep the system relevant for a changing society. The head of it, Ed Davey, recently pledged to "expand its financial services and become a genuine front office for local and national Government."
Should America do the same? Post offices are a national asset without equal. There are some 36,000 branches of the post office across America. Imagine if you could use your local post office as a one-stop shop for banking, bill paying, insurance, and a variety of government services. If the U.S. Mail's storefronts partnered with a suite of extra services to make extra money and create a more convenient storefront for Americans, what would it look like?
A lot like Great Britain, as the video shows.
Our Postal Service is an independent branch of the government -- technically, the Executive Branch. Our mail system has not received taxpayer dollars since the early 1980s, which is why as snail mail use sags, the postal rate skyrockets.
In recent years, increasingly burdened by over staffing, the U.S.P.S. has tried to increase revenue by aggressively "upselling" customers with add-ons such as insurance and delivery confirmation, but it hasn't taken the bolder step of partnering with a wide array of government and banking institutions to make government-related chores easier for Americans.
With American financial institutions writhing in the mud, soiled by scandal and bailouts, the time may have arrived for a new national banking institution to step in. While our post offices could partner with major brands, perhaps the better tactic would be to create its own guaranteed Post Office-branded bank, which could issue many of the same services as the British version does through its network.
Britain, which like us has been closing branches in recent years, just wrestled with the idea of creating a government-backed "Post Office Bank" that would draw customers to the Post Office. The idea had been growing in popularity for years, but it was scrapped for now out of recession-related concerns. The cash-strapped government has also started privatizing portions of the Royal Mail service.
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Reader Comments (Page 1 of 11)
1-14-2011 @ 9:07AM
james said...
I welcome new services for my local post office. If they decided to provide good banking services and NOT act like a normal bank with fees upon fees, maybe this idea might work. I wouldn't open a bank account (cash only) but many people would just to get away from big banks. The post office should also consider notary services, bill pay, and government check cashing.
Reply
1-14-2011 @ 2:40PM
Gail said...
Keep the Satruday delivery - www.paydayloansecrets.info - charge way more for the junk mail!
1-14-2011 @ 5:40PM
Bob said...
38,000 post offices! Cut half or two thirds of them. I am a 5 minute drive from 4 of them, and a 10 minute drive from 11 of them. Each one has a postmaster and infrastructure to maintain. We would all be better served by putting PO boxes at the local 24 hour mini-mart and closing most of the post offices. Forget going into competition with private banks. Do you think the government can be more efficient than a private bank? Buy your money order at Wal-mart for 69 cents. The post office charges $3. Make the post office smaller - MUCH SMALLER - and we will all be better off.
1-14-2011 @ 5:43PM
Katie said...
The post office needs to go back to service. I am a small business owner, and there isnt a single solitary person at any USPS spot who will help me with the needed items for discounts for bulk mail. The post office could do it's own software for people to buy, walk them through step by step on how to put together a bulk mailing, and then provided assistance with the mailing list and making the sheets that show how much the bulk mailing would cost. Direct mail is back in favor, so they need to go back to this asap.
1-14-2011 @ 3:19PM
deb said...
If they would stop paying millions of dollars to the idiots at the top, they wouldn't even have a problem. Way too many people at the top to start with, and all of them are serious overpaid.
Reply
1-14-2011 @ 4:03PM
sn0burd said...
I don't know much about what those postal biggies do, but I do know that there are hundreds of offices very near each other, sometimes only a mile or two away. That's alot of waste.Also, I think they should use electric vehicles. That would save millions and cut pollution.Stamp increases and cutting Saturday service show that we are still dealing with a relic that is not very well run.
1-14-2011 @ 1:59PM
Postal Wife said...
As a wife of a 30-year USPS employee, I've done some research on this. These ideas have been brought up for some time, but it's the "independent" Postal Commission that is holding up progress.
Write your representatives and ask them to change the current oversight restrictions so the USPS can survive and serve all citizens.
Reply
1-14-2011 @ 3:28PM
JH said...
Postal Wife: You should name and describe the "current oversight restrictions" that you want people to write to the government about.
How can we write to the government to change something when we don't know what that is?
1-14-2011 @ 2:01PM
shane said...
It would definitely help the post office to re-exam their costly wages to the managers and supervisors in the post office. they also get a ridiculous amount of money for moving expenses. stamps going up? get rid of these outstanding wages!!!!!!!
Reply
1-14-2011 @ 2:03PM
R L Baker said...
Stop saturday deliveries and start charging more for all of the junk mail.
Reply
1-14-2011 @ 3:42PM
noya said...
not gonna happen, its been talked about for more years then you been alive!
1-14-2011 @ 5:29PM
Joe said...
Hey, why not just become Competitive to UPS and FED X?
Isn't that a Novel Idea?
God Forbid
1-14-2011 @ 6:03PM
pinus1 said...
Right, and have the "non-profits" pay the regular postage too.
Getting rid of Jack Potter was the first step. I would enjoy the job of Postmaster General. Give me two years and in the black!
If I recall correctly, back in 1876 the post office dropped the rates 1 cent. When they did this the increase in mailing was 10,000%
1-14-2011 @ 7:57PM
Karen said...
You can shut the whole thing down as far as I am concerned. I have virtually no use for the post office.
I can't remember the last time I used it. Everything is done electronically now. If they can't be competitive, it is time to shut it down.
1-14-2011 @ 8:01PM
Another Postal wife said...
I see you all sitting here complaining about the cost of stamps being raised LOL I have to ask you all, HOW many of you use the post office since you have internet to pay bills or mail letters to your family? Stop whining about a company that is trying to survive when your the ones that are costing it the business to survive!! As for competing with fedex and ups...those have the right to raise their rates as they choose to. USPS has to go to your wonderful loser congress to get approval for any changes in prices or closures of offices. So you wanna tell us again how it's USPS causing this problem? Try bitching to your local congress to stop the crap and let this company do what it needs to survive. FYI: for the years that USPS was profitable, CONGRESS took the "excess" money for the "general fund". It is NOT the P.O causing the problems people. Although I do agree that there is way too much fat at the top in Washington and also in District Managers. Start cutting that fat and the "bonuses" they receive for the work the offices "carriers, clerks, supervisors, managers, and post masters" do everyday. Why should they get a bonus for pushing the work downhill and sitting there complaining when things don't work like they want it to? They even have the nerve to bitch when they don't get their bonus cause "the employees" didn't work hard enough or weren't productive!! O.O
1-14-2011 @ 2:03PM
Eddie Munster 2525 said...
They might be losing money, but they don't have any problem stealing from packages that are shipped. I will NEVER use the usps to ship anything again. Typical overpaid government theives.
Reply
1-14-2011 @ 2:20PM
Linda said...
Why don't you learn about the topic you are commenting on. The Post Office is not part of the government, nor is it a branch of the government as this article wrongly states.
1-14-2011 @ 2:50PM
allen said...
Wikipedia:
The United States Postal Service (USPS) is an independent agency of the United States government, established in 1971 as an "independent establishment of the executive branch", {Looks like part of the goverment}
1-14-2011 @ 3:43PM
Eddie Munster 2525 said...
Hey linda. Why don't you learn that people are sick of getting ripped off, oh! I guess that you must know somone that works there. Why do you have to take a civil service exam if it's not tied to the government.
1-14-2011 @ 3:58PM
noya said...
Eddie Munster, getting ripped off? what do you mean getting ripped off?, take your welfare attitude and keep on spending your food stamps so you can stuff your face with food and be quiet!