Not really political but how the hell is USPS losing money?

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davo1224

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I saw on the news this morning about them closing post offices, cutting jobs, etc. because they're not doing well.

My question is how? I have to believe this is a lie just so they can use this tough time for everyone as a cover to squeeze more money out of people. Unless you have a great deal with UPS/FedEx, the USPS is pretty much a monopoly in the entire country to the point of where people think it's an actual government institution. How can you be doing badly when you're the only game in town more or less?
 
[quote name='davo1224']I saw on the news this morning about them closing post offices, cutting jobs, etc. because they're not doing well.

My question is how? I have to believe this is a lie just so they can use this tough time for everyone as a cover to squeeze more money out of people. Unless you have a great deal with UPS/FedEx, the USPS is pretty much a monopoly in the entire country to the point of where people think it's an actual government institution. How can you be doing badly when you're the only game in town more or less?[/QUOTE]

Maybe they are actually charging less than it costs to mail your letter? Monopoly or not, there are costs that they have to meet.
 
Well I imagine they're not immune to the problems of the recession (and they make the majority of their money from shipping shit from one person to another person who bought that shit, so if there are less people buying that's fewer packages and less money).
 
[quote name='Mr Unoriginal']Maybe they are actually charging less than it costs to mail your letter? [/QUOTE]

I find that hard to believe. I could drive a letter from here to Hawaii on less than a fifth of a gallon of gas.
 
What they have never had a lay off or reduction in work force. The benefits and raises eventually sink a company if they are too good. That appears to be the issue here.
 
:rofl:

EDIT: I wonder if part of this is their failure to adapt to a post-email market? They no longer have mounds of fan mail to send to winners of "Star Search" and things of that nature, since we just communicate over this here ma-cheen anyway. That's a lot of lost revenue. Though postage has gone up like a motherfucker in the last 10-15 years, so maybe I'm way off base there.
 
I've always felt that the USPS should embrace email. Give each of us a lifetime email address, and charge senders for the right to access that network.

Certainly the above plan is flawed in some ways, but it's really just a nascent idea.
 
1) They contract a ton of their work out to private for profit entities such as UPS/FedEx. They should be doing those themselves for radically less cost.
2) They dont charge enough to mail those weekly ad circulars that no one wants.
 
The USPS is failing because it is managed very poorly. This current recession just exacerbates their problems. I don't believe they have ever had a year where they didn't operate at a loss..
 
It's simple really.

People are mailing much less stuff--paying bills online, e-mail instead of letters etc.--but it takes just as many mail men/women to cover all the routes regardless of how much mail their dropping off/picking up from each person on the route as the time is spent driving/walking the route. It really takes no more time to put 5 letters in a mail box and take 2 being mailed out than to drop off 1 and pick up none, so they aren't able to cut back on labor much even with less mailings.

Thus revenues keep dropping while costs don't.
 
yeah except you have to factor in ebay, online auctions, purchases, etc.

They have to making a shitload more off that now for the past 5-7 years dmaul. I mean as you said they are doing the same route, but now its packages instead of .44 cent letters.
 
I don't think their competitors are doing so badly.

This doesn't bode well since I've heard several people use USPS as a "good example" of why government takeover of healthcare can be done right. That never made sense to me after I read an article last year saying that USPS has been losing something like 4 billion a quarter for a while now.
 
Now I don't know much about the post office's financial trouble, but here's a little story about my friend's dad that pisses me off to no end, and just screams "hemorrhaging money".

My friends dad is 65, been with the post office since he was 18, and has also been an alcoholic most of those years. About 10 years ago, he showed up to work shit face drunk, stumbles out of the car, only to be turned around before he ever got to the door, sent home, WITH pay. No punishment what-so-ever for the fact that he was about to take a company truck on the road while drunk.

Fast forward to about 2 years ago, no incidents at work, but over all, everyone knows he has a problem and just lets it slide. He shows up to work once again drunk. Only this time some district supervisor is there, smells alcohol on his breathe. He has to to to the hospital because they can't do anything without proof because of the old horseshit standby "it's just the mouthwash I use". Anyways, sure enough, he's absolutely loaded. His job is terminated, he's sent home. After some whining and crying to the union, they pull their shit, and work out a deal where if he completes a rehab program, he can have his job back. So he sits on his ass for about 6 months drinking himself stupid before he decides he's running out of money and has to get back to work. He completes some poor excuse for an alcoholic outpatient program, so he can return to work. But that's not good enough. He feels that the post office drove him to drinking and should get backpay for the year he was out of work, doing nothing but drinking. Yes, apparently sorting mail for a few hours in the morning, then hopping into a truck and putting it in mailboxes and getting paid $30 an hour to do it is super stressful. I wish my life was that stressful. Sure as shit, the union agrees with him and makes some noise, and he gets cut a check for almost a year of being a useless lump.

Long story short, I feel like the union is somehow to blame.
 
[quote name='Snake2715']yeah except you have to factor in ebay, online auctions, purchases, etc.

They have to making a shitload more off that now for the past 5-7 years dmaul. I mean as you said they are doing the same route, but now its packages instead of .44 cent letters.[/QUOTE]

True, but obviously that's not been enough extra revenue to offset the lack of letter and bill mailing. Not everyone ships packages. Everyone used to mail several letters a month for just bills if nothing else.

The only way they're going to get costs down is to cut service and get rid of at least Saturday delivery. Do that and raise postage more.

There's already crazy long lines at every post office I've been too regardless of time of day or day of week for the past couple of years, so they can't shut down offices and layoff people there many places.
 
[quote name='opterasis']

Long story short, I feel like the union is somehow to blame.[/QUOTE]

I have to agree with the union sentiment.
 
[quote name='thrustbucket']I don't think their competitors are doing so badly.

This doesn't bode well since I've heard several people use USPS as a "good example" of why government takeover of healthcare can be done right. That never made sense to me after I read an article last year saying that USPS has been losing something like 4 billion a quarter for a while now.[/QUOTE]

1) false equivalency. the health care bill's aim is to be revenue neutral.

2) lacking a contextual understanding. some gov't programs bring in revenue, others do not or run a negative balance. being in the latter category is not inherently a net negative, unless viewed in a tunnel. which it isn't.

3) if you can provide health care to every American and be out $16B a year compared to the deficits we run already, that's a helluva place to be.
 
Yeah, that's a bit of a downside with packages. With a letter, you just throw a stamp on it and drop it in the mail box. With a package, you, generally, have to take it to the counter, have it weighed, fill out the insurance forms, etc., etc. So then, you need to hire more people to man the counter and/or more customers get mad due to the long waits - so they opt to use another service.
 
If they have less mail to deliver shouldn't they be able to cut back on the number of drivers/handlers? That would save them money from labor and fuel/upkeep on vehicles. I've heard before that companies get to mail out junk mail ads for next to nothing too, maybe USPS should charge more for that shit.
 
[quote name='JolietJake']If they have less mail to deliver shouldn't they be able to cut back on the number of drivers/handlers? That would save them money from labor and fuel/upkeep on vehicles.[/QUOTE]


Again, the time is driving the route, not sitting at a mail box throwing in the mail. That's already sorted so it takes no more time to throw in 10 letters than it does one. The time is in driving to that mailbox, not in sitting at the mailbox.

I'm sure they have cut back on sorters in the processing facilities as volume has went down. But it still takes as many people to drive/walk the routes regardless of how much mail their carrying now vs. the past.

The only way to cut down on that is to eliminate days of service.
 
I shop based on the amount of value I get out of a service or a good. Value consists of cost and quality. The cost of the USPS isn't that great, and the level of quality is horrible. As other posters have said, there are always long lines, usually with older employees moving at a snail's pace. Nothing is automated to make it run better, not knowing the details, I would assume an organization that large is stuffed with middle management and unnecessary supervisors, then IMO, the union and their demands are another tax on the system.

They're a failing business, just like most of the airlines, and it's in part due to the economy, but overwhelmingly a result of operating a crappy business.
 
[quote name='JolietJake']If they have less mail to deliver shouldn't they be able to cut back on the number of drivers/handlers? That would save them money from labor and fuel/upkeep on vehicles. I've heard before that companies get to mail out junk mail ads for next to nothing too, maybe USPS should charge more for that shit.[/QUOTE]

Less letters but more packages doesn't help with drivers and vehicles though. If you went from 100 letters/day and 10 packages/day to 10 letters/day and 30 packages/day, you could end up needing *more* drivers/vehicles because those extra 20 packages need more space than you gained by losing the 90 letters.

As for junk mail - I'd love to see them raise rates on that, just so I could stop getting it. ;)
I think the main reason they're reluctant to raise rates on junk mail is because those who send it threaten to stop sending it. While they make crap sending it out to everyone, it *is* a steady stream of income.

I agree that cutting down delivery days is about the best solution - and, while Saturday seems like the best day, it'd be nice if it wasn't two back-to-back days...
 
[quote name='mykevermin']1) false equivalency. the health care bill's aim is to be revenue neutral.

2) lacking a contextual understanding. some gov't programs bring in revenue, others do not or run a negative balance. being in the latter category is not inherently a net negative, unless viewed in a tunnel. which it isn't.

3) if you can provide health care to every American and be out $16B a year compared to the deficits we run already, that's a helluva place to be.[/QUOTE]

while a agree with your point in #2. I don't believe government being solvent with some programs doesn't forgive insolvency in others. We should expect more than that where our money is concerned.
 
Maybe it is time to privatization the post office? It worked out pretty well for Japan and Germany.
 
[quote name='62t']Maybe it is time to privatization the post office? It worked out pretty well for Japan and Germany.[/QUOTE]

I don't really know enough to agree or disagree, but there are some massive differences between the US and Japan/Germany that IMO make the comparison moot.

Can the post office be more efficient? Absolutely. But as long as congress wants to force legislation down their throats we should expect to foot part of the bill.
 
I think there is a misunderstanding as to how much room they have in changing their operations. Most businesses in this economy have cut services, employees and raised costs. Cutting employees for the Post Office isn't that easy. They also really can't cut services, they have to deliver mail daily, it's their job. Most businesses wouldn't deliver to all the places that they deliver too. They have to deliver everywhere, even in places it isn't financially viable. In a lot of areas they will have to keep a base number of employees, even if volume isn't up to what it would need to be to keep that area profitable. The Post Offices real mission is to provide affordable lines of communication between areas, which they do.
 
Maybe the post office could hire some younger and hungrier employees at less than $30 an hour. If the wage was at $15 or $20 it wouldn't be so much like welfare in disguise.
 
[quote name='Doc Bacca']. The Post Offices real mission is to provide affordable lines of communication between areas, which they do.[/QUOTE]

Add "very poorly" to that last sentence and I agree completely.
 
[quote name='xxDOYLExx']Add "very poorly" to that last sentence and I agree completely.[/QUOTE]

I never get that attitude. They deal with a shit ton of mail and I've had maybe one or two things get lost over my lifetime so far.

Going to the post office sucks, prices could be better, but shit gets where it's going.
 
oh its political because our gov't will throw billions at them to keep the usps afloat.

post office is failing because of the electronic age... email, bill pay, paperless statements etc. competitors like ups, fedex, dhl etc. and because of outrageous salaries and pensions.

theyve talked about closing saturdays down. imo, thats a terrible idea people work during the week and id imagine a lot of them like saturday to be the day to "get stuff done". id rather they close down monday or tuesday.
 
The main problem here is business comes and goes in cycles. (Like a sine wave). The correlation that I should pay your company more money because it has more expenses is crazy. USPS created its own expenses. Infact they are pricing themselves out of business now. So what if USPS is not breaking profits during a recession, god dammit they have to tough it out with the rest of us. OR FOLD UP SHOP. They tried to wedge themselves in between government and regular people so they are viewed as an official establishment, and the "only option". WE DONT HAVE TO TAKE THIS CRAP.

USPS should infact LOWER its prices. Then everyone would use them! I am 30, I pay every bill I can online because I dont want to spend almost .50 to mail every letter. There was a time where I sent out over $10 a month in just regular MONTHLY bills to go out (mortgage, insurance, cellphone, cable, heat, electric, water, credit cards x3, car payment, motorcycle payment). And then regular correspondance that had to go out... Long story short, if you keep raising your rates on me, I am going to boycott you in every sense that I can. F U Post office. FU. I would not of transitioned over, if they would cost .28 cents to mail, like it used to. Would you rather sell your services to 100 million people affordably? Or a niche service to 60 million people at 15% more surcharge rates?

Even a crack dealer can price himself out of the game. Crack heads wont spend $100 on a $10 rock, but if you priced those rocks at $10, they would smoke until they couldnt smoke anymore.

This is a business that participates in cannibalization. It is eating itself from the inside out.

The USPS should only deliver PERSONAL mail, and then let UPS and DHL handle any and ALL packages. Maybe its taking on a job or responsibility that it cant handle. I guess they would never admit that though.
 
I don't get complaints about the cost of a stamp, the price has stayed almost exactly the same for decades and has only gone up with inflation.
 
[quote name='SpazX']I don't get complaints about the cost of a stamp, the price has stayed almost exactly the same for decades and has only gone up with inflation.[/QUOTE]

I'm not old enough to confirm that, but it seems like over 15 years the rates have gone up a lot, and not in line with inflation. Stats?

Looks like since 2006, it's gone up an average of a penny per year. Prior to that, 1-3 cents per 3-4 years:

http://www.vaughns-1-pagers.com/economics/postal-rates.htm
 
[quote name='exceed19']
USPS should infact LOWER its prices. Then everyone would use them! I am 30, I pay every bill I can online because I dont want to spend almost .50 to mail every letter.[/QUOTE]

I'd don't buy that.

People playing bills online would still pay them online even if mail was free.

It's just more convenient. A couple clicks and you're done. No filling out a check (which you have to buy from your bank) remembering to mail it etc.

I do e-bills because they're convenient, not because of the cost of stamps--which is still literally pocket change.
 
i have no idea if this is true, but i have heard companies like netflix is hurting the post office. They bought so many envelopes at a flat rate, and since they had to raise the price, all these netflix envelopes are being shipped after being paid at the cheaper price for postage. No evidences, I believe i read it somewhere, so take it with a grain of salt.
 
Well really all this is getting at then is that it seems like they're no longer needed. If they're the only game in town and they're losing money because of poor practices, they should go down the toilet. Of course you can't have that because they are still needed, they just obviously are doing a poor job. They're being bent over by businesses and are trying to pass the cost onto the majority of society who no longer use them. How they expect to stay in business off of people in rural areas without internet access is beyond me.
 
[quote name='Quillion']I love all the amateur business analysis in this thread. :)

It makes a fella feel all warm and fuzzy inside.[/QUOTE]

Which was your favorite part?

1. The USPS workforce isn't shrinking despite articles showing that it is.

2. There is no automation despite Automated Postal Centers being around for at least 4 years.

3. Pensions and salaries are outrageous despite my entry level tech support job pays more and I can walk right into the position with a modest amount of knowledge.
 
Well to point 1, I didn't say the workforce hasn't been reduced. Just that it's hard to reduce the number of mail carriers as there are still the same number of routes to cover--actually more I suppose as the population expands and new developments are built etc. Cuts have been made in other parts of the workforce.

For 2, their is automation, the problem is people don't use it enough. The lines in the post office are always long and slow as you have people (lots of older folk especially) still waiting in line to mail something or buy stamps rather than using the machine. So that would be one way to reduce workforce some. Make some post offices just have a few of those machines and have one front office person working who is only there to help with the machines.

They also have all the online mailing options. I never wait in line to mail anything, as I use paypal shipping to buy my USPS labels. I get stuck waiting in line to pick up packages as our mail man won't deliver packages to our doors in our condo complex. It either fits in the package compartments in the mailbox (and you get a key in your mail box to get it)--or you go to the post office and pick it up. Really sucked around x-mas as there's only 6 package mailboxes so even small stuff I was having to go pick up as the package boxes would stay full as people were getting gifts while out of town etc.
 
[quote name='Quillion']I've always felt that the USPS should embrace email. Give each of us a lifetime email address, and charge senders for the right to access that network.

Certainly the above plan is flawed in some ways, but it's really just a nascent idea.[/QUOTE]

Hell motherfuckin' NO. There was a rumored plan like this going around a number of years ago where the USPS wanted to get the authority to charge people for every e-mail sent. I'm sure it was just a rumor started by some nutjob on the internet for shits and giggles, but if it ever came to pass I would forgo sending e-mail since I know the money made from a per-email charge would go to useless expenses that the government never checks up on(like those $500-$1000 plastic toilet seats unscrupulous companies sell and the gov't buys en masse).

If anything, one of the things that could be a bit more streamlined is the routes that mail takes. For example, I mailed a guide package via Media a couple of years ago to a CAG in VA. I live in PA and I watched the package go from my area, out to NJ, down alllllll the fuckin' way to either North or South Carolina and then the fuckin' thing took 3 weeks to get back up to VA.

Yeah. Tell me that one package didn't cost more than a bit of gas and wages to process.

Just recently, I sent out two packages for two seperate deals, one going to TN and the other going to MA. The package going to MA arrived a week plus after I mailed it, while the one going the further distance arrived in 3-4 days. Said package was shuffled around the Boston post office and 'sorted' about 4-5 fuckin' times.:roll:

Yeah. And they wonder why they're in friggin' financial trouble.:roll:
 
Raise 1oz first class to 50c and keep the rest the same. 6 cents ain't gonna kill anyone but the USPS will make some $.

Sometimes I feel sorry for the people who work at my local post office. Everyday they have to deal with the stupidest and most uninformed people I've ever seen.
 
kinda old but
[quote name='IAmTheCheapestGamer']Hell motherfuckin' NO. There was a rumored plan like this going around a number of years ago where the USPS wanted to get the authority to charge people for every e-mail sent. I'm sure it was just a rumor started by some nutjob on the internet for shits and giggles, but if it ever came to pass I would forgo sending e-mail since I know the money made from a per-email charge would go to useless expenses that the government never checks up on(like those $500-$1000 plastic toilet seats unscrupulous companies sell and the gov't buys en masse).

If anything, one of the things that could be a bit more streamlined is the routes that mail takes. For example, I mailed a guide package via Media a couple of years ago to a CAG in VA. I live in PA and I watched the package go from my area, out to NJ, down alllllll the fuckin' way to either North or South Carolina and then the fuckin' thing took 3 weeks to get back up to VA.

Yeah. Tell me that one package didn't cost more than a bit of gas and wages to process.

Just recently, I sent out two packages for two seperate deals, one going to TN and the other going to MA. The package going to MA arrived a week plus after I mailed it, while the one going the further distance arrived in 3-4 days. Said package was shuffled around the Boston post office and 'sorted' about 4-5 fuckin' times.:roll:

Yeah. And they wonder why they're in friggin' financial trouble.:roll:[/QUOTE]

i share a similar sentiment (would never pay for email), but it's interesting to step back for a moment and realize how ridiculous that stance is. email is actually pretty complicated. especially good email. i mean, providing email service. stuff like gmail is absolutely mind boggling -- gigabytes of storage on incredibly reliable, redundant, fast servers supposed supported just by ads -- we take it for granted, it's nothing that necessarily should be free, we should be amazed (and grateful) that we aren't paying a subscription. same goes for most free sites.
 
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"cough" give big bonuses to executives based on performance and USPS will be back in the black in no time! Their top guy doesn't even make 1 mill a year.
 
USPS should be privatized. The only real argument against this has been that private companies won't deliver mail to rural areas, and if that really turns out to be the case that could either be subsidized or just keep USPS as a vestigial organization like the rural electrification folks. That's not ideal, but it sure would cost a lot less than $238 billion over the next 10 years (http://money.cnn.com/2010/03/02/news/economy/usps/). The simple fact is that we are already going bankrupt and we just can't afford to spend $23.8 billion per year on this when private companies can do it just as well if not better. Plus the government should see some one-time cash to pay down our debts if they sell off USPS property and equipment.
 
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