Bloomberg News

Postal Service Woos Web Retailers With Same-Day Delivery Test

October 13, 2012

The U.S. Postal Service, struggling to stem billions in losses as first-class mail usage declines, plans to test a same-day delivery service that would help Internet retailers ship their customers’ purchases more quickly.

During the trial of Metro Post, which begins in mid- November in San Francisco, the postal service would deliver packages during the evening that were received before 2 to 3 p.m., said Susan McGowan, a spokeswoman. She declined to provide logistics or pricing details of the test, disclosed in plans filed with the agency’s regulator yesterday.

In order to participate, companies must have at least 10 physical locations nationwide with at least one location in the test market, she said. The San Francisco test may last as long as a year, and there are plans to expand into additional cities if it goes well, McGowan said.

“E-commerce is just growing, and this kind of a product improves the shopping experience for everyone,” she said in a telephone interview. “This helps us achieve our goals of enhancing our package business and giving customers better access and better service.”

The Postal Service is in talks with online retailers and anticipates working with as many as 10 companies during the trial. The agency must obtain approval from the Postal Regulatory Commission before moving ahead, McGowan said.

“The product is likely to contribute to the financial stability of the Postal Service, by generating more package deliveries that do not currently move within the postal system,” the agency said in its filing.

The post office, which may have lost as much as $15 billion in the fiscal year through Sept. 30 is seeking to develop new revenue streams and reduce costs.

The agency plans to cut $20 billion in yearly operating expenses by 2015 through steps that include reducing its workforce and closing processing plants. The agency said this month it would offer $15,000 each to members of its biggest union to retire.

To contact the reporter on this story: Victoria Stilwell in New York at vstilwell1@bloomberg.net

To contact the editor responsible for this story: Ed Dufner at edufner@bloomberg.net


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