The US Postal Service fell short of its performance targets for a host of its mailing and shipping services last year, and on-time delivery percentages in many categories were actually worse than 2014, the agency’s regulator has found.
The Postal Regulatory Commission this week issued a critical report detailing the shortcomings of a broad array of USPS products in fiscal 2015, including First Class and standard mail, P.O. Box services and parcels.
Indeed, the majority of the Postal Service’s products received failing grades in the PRC’s annual compliance determination, which evaluated the costs and on-time delivery percentage of the spectrum of USPS services.
In particular, the PRC highlighted service problems with flats. “This year’s review of flats shows results for these products remained substantially below their targets, and in all but one case, the performance results declined,” the commission said.
Every product in the category of First Class mail also failed to reach its performance targets, including overnight parcels, 2-day and 3-5 day parcels, which each saw declines in on-time percentage from fiscal 2014.
According to the PRC’s analysis, 84.8 percent of First Class overnight packages arrived on time, down from 88.4 percent the previous year and well short of the target mark of 96.8 percent. For 2-day packages, 84.2 percent arrived on time, down from 86.8 and short of the target of 96.5 percent. Packages in the 3-5 day class fared worse, with just 73.7 percent arriving on time, off 10 percentage points from the previous year and nowhere near the target of 95.25 percent.
The Postal Service attributed some of the delivery delays to winter weather.
Standard mail parcels met the performance targets the Postal Service set for the product class for the fiscal year, standing as one of the few bright spots in the PRC’s evaluation.
The PRC directed the Postal Service to improve its overall service performance, and mandated that the agency produce a series of reports addressing deficiencies in various products classes.
Responding to the PRC report, USPS spokesman David Partenheimer emailed this statement: “The Postal Service is committed to improving service and has deployed all available resources to achieve results and engage the public in its efforts.”
Those words can also be found in the reply comments the Postal Service issued to the PRC in February, ahead of the release of the regulator’s annual report. There, the Postal Service argued that it was well along on its multi-pronged “network rationalization” initiative, through which it is trying to streamline its operations in response to shifting mailing conditions.
The Postal Service also noted that it had produced numerous reports in 2015 and 2016 “based upon data analytics to more quickly identify service issues.” Those reports included evaluations of delivery delays and analysis of the proportion of capacity in use by various pieces of equipment throughout the agency’s network of facilities.
The PRC report also examined some of the individual agreements that the Postal Service has reached with individual parties in the mailing community. The report cited 24 “workshare discounts” that were non-compliant because of excessive costs.
PRC spokeswoman Gail Adams explained: “Worksharing provides reduced rates for mail that is prepared or entered to avoid certain activities the Postal Service would otherwise have to perform. For example, dropshipped mail is transported by the mailer, and thus the Postal Service does not have to transport the dropshipped pieces across the entire network.”
The PRC also cited the Postal Service for cost overruns in a handful of specific competitive products, including two negotiated service agreements (NSAs), obliquely referenced as Priority Mail Contract 135 and Parcel Service Contract 8.
NSAs are a tightly guarded secret at the Postal Service. In those agreements, Partenheimer explained, “the party identity is kept under seal.”