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Competing with and Buttressing the U.S. Postal Service: A Business and Market Review

Product Type: Market Research Report
Published by: BCC Research
Published: April 2004
Product Code: R2-780
Description
This review addresses the nature of the postal industry, as well as the unique problems and opportunities that beset it. The postal industry delivers more than 500 billion pieces of mail annually globally. Further, the industry, which generates $900 billion domestically, employs approximately 6% of the American work force. The demands of the industry have become increasingly expansive in that 1.6 million delivery points are added to the postal network each year. The U.S. Postal Service (USPS) is of major importance to the industry in that it delivers 40% of the world's mail and more than 7 million Americans visit postal outlets daily. Because mail collection and distribution services have undergone dramatic changes that have and will impact the economy, the postal industry must implement innovative and business oriented solutions. These solutions will leverage off of the use of technology used in other commercial enterprises and will require the participation of the business and government communities, as well as postal industry associations. This review will describe the innovations and new thinking (and attendant technologies) that will shape the industry through 2007, including new equipment and strategies necessary to provide an effective and cost efficient mail collection and distribution process. It will discuss the industry role in electronic payments, transformation planning, and the effect of competitive forces on the industry. The review will detail transactional volumes in the industry through 2007 and how changes to the industry will impact the global economy.
Table of Contents

INTRODUCTION

REVIEW GOAL AND OBJECTIVE



REASONS FOR DOING THE REVIEW



CONTRIBUTION OF THIS REVIEW AND FOR WHOM



SCOPE AND FORMAT



METHODOLOGY



INFORMATION SOURCES



AUTHOR CREDENTIALS



RELATED BCC WORK



BCC ONLINE SERVICE



INTERNET



SUMMARY

Summary Table:

REVENUE MARKET SHARE DISTRIBUTION - MAIL INDUSTRY USA, 2002 AND 2007 (% OF TOTAL)



Summary Figure:

REVENUE MARKET SHARE DISTRIBUTION - MAIL INDUSTRY USA, 2002 AND 2007 (% OF TOTAL)



USPS OVERVIEW

USPS OVERVIEW



USPS OVERVIEW (CONTINUED)



PRODUCTS AND SERVICES



Table 1 USPS OPERATING REVENUES BY PRODUCT, 1999-2002 ($ MILLIONS)



Table 2 USPS SPECIAL SERVICES REVENUE, 1999-2002 ($ MILLIONS)



EQUIPMENT AND INFRASTRUCTURE



Table 3 USPS OFFICES, STATIONS AND BRANCHES, 1999-2002



Table 4 USPS DELIVERY POINTS, 1999-2002 (THOUSANDS OF LOCATIONS)



Table 5 USPS STAFFING COUNTS, 1999-2002



PROFILES OF SUPPLIERS OF USPS PROCESSING SYSTEMS



Lockheed Martin Corporation Distribution Technologies (LMDT)



Adaptive Optics Associates, Inc. (AOA)



Shuttleworth Inc.



Interoll Axmann Automation, LLC



Accu-Sort Systems, Inc.



Sandvik Sorting Systems, Inc. (Sandvik Sorting)



STRENGTHS, WEAKNESSES, OPPORTUNITIES AND THREATS (SWOT)



Table 6 STRENGTHS, WEAKNESSES, OPPORTUNITIES AND THREATS



COMPETITION

PRODUCTS



SERVICES



COST EFFICIENT RETAIL NETWORK INFRASTRUCTURE



CONVENIENT PICK UP SERVICE



SAME DAY DELIVERY SERVICE



CUSTOMER CREDIT OPTIONS



FLEXIBLE PRICING



SALE OF CONVENIENCE ITEMS



LIMITED FUNCTION ATMs



DELIVERY CONFIRMATION TRACKING



SUPPLY CHAIN AND LOGISTICS MANAGEMENT SERVICES



BUSINESS ALLIANCES AND ACQUISITIONS



Table 7 SUMMARY OF BUSINESS ALLIANCES RELATING TO MAIL INDUSTRY



Table 8 SUMMARY OF USPS MAJOR COMPETITORS



MARKET SHARE CONSIDERATIONS



CURRENT



Table 9 MARKET SHARE DISTRIBUTION - OVERALL MAIL INDUSTRY, U.S., 2002 ($ MILLIONS)



Table 10 MARKET SHARE DISTRIBUTION - PRIORITY, OVERNIGHT, PACKAGE MAIL, 2002 ($ MILLIONS)



Table 11 MARKET SHARE DISTRIBUTION - INTERNATIONAL MAIL, 2002 ($ MILLIONS)



REVENUE DIVERSION



Table 12 REVENUE DIVERSION FROM FIRST CLASS, STANDARD AND PERIODICAL MAIL, 2002 ($ MILLIONS)



PROJECTIONS



Market Share 2002 through 2007



Table 13 PROJECTION OF REVENUE - OVERALL MAIL INDUSTRY, U.S., THROUGH 2007 ($ MILLIONS)



Figure 1 PROJECTION OF REVENUE - OVERALL MAIL INDUSTRY, U.S., 2001-2007 ($ MILLIONS)



Table 14 OVERALL U.S. MARKET SHARE DISTRIBUTION, 2001-2007 (%)



Figure 2 OVERALL U.S. MARKET SHARE DISTRIBUTION, 2002 AND 2007 (%)



Table 15 PROJECTION OF PRIORITY, OVERNIGHT AND PACKAGE MAIL MARKET SHARE DISTRIBUTION, THROUGH 2007 ($ MILLIONS)



Figure 3 PROJECTION OF PRIORITY, OVERNIGHT AND PACKAGE MAIL MARKET SHARE DISTRIBUTION, 2002 AND 2007 ($ MILLIONS)



Table 16 OVERNIGHT AND PACKAGE MAIL MARKET PERCENT SHARE DISTRIBUTION, 2002 AND 2007 (%)



Table 17 PROJECTION OF INTERNATIONAL MAIL DISTRIBUTION, THROUGH 2007 ($ MILLIONS)



Figure 4 PROJECTION OF INTERNATIONAL MAIL DISTRIBUTION, 2002 AND 2007 ($ MILLIONS)



Table 18 MARKET SHARE DISTRIBUTION, 2002 AND 2007 (%)



The Impact of Revenue Diversion in 2007



Table 19 IMPACT ON THE USPS OF DIVERTED REVENUE, 2002-2007



Table 20 REVENUE DIVERSION FROM FIRST CLASS, STANDARD AND PERIODICAL MAIL, THROUGH 2007 ($ MILLIONS)



SWOT FOR MAJOR CLASSES OF COMPETITORS



MAJOR COMMERCIAL CARRIERS



Table 21 STRENGTHS, WEAKNESSES, OPPORTUNITIES AND THREATS, MAJOR COMMERCIAL CARRIERS



COURIERS AND MESSENGERS



Table 22 STRENGTHS, WEAKNESSES, OPPORTUNITIES AND THREATS, COURIERS AND MESSENGERS



MAIL AND PARCEL CENTERS



Table 23 STRENGTHS, WEAKNESSES, OPPORTUNITIES AND THREATS, MAIL AND PARCEL CENTERS



ACH AND BANK ONLINE PAYMENT COMPANIES



Table 24 STRENGTHS, WEAKNESSES, OPPORTUNITIES AND THREATS, ACH AND BANK ONLINE BILL PAYMENT COMPANIES



PROFILES OF MAJOR COMPETITORS TO THE USPS



COMMERCIAL CARRIERS



FedEx Corporation



Table 25 DESCRIPTIONS OF THE MAJOR OPERATING GROUPS OF FEDEX



Table 26 SUMMARY OF REVENUE - FEDEX CORPORATION, 2000-2002



Table 27 DISTRIBUTION OF REVENUE - FEDEX CORPORATION, 2000-2002 (% OF TOTAL)



United Parcel Service, Inc. (UPS)



Table 28 UPS REVENUES FROM PACKAGE DELIVERY, 2002



Table 29 COMPARISON OF UPS PRODUCT REVENUES, 1999-2002



Table 30 PACKAGE OPERATIONS



Latest News - UPS Basic



Airborne, Inc.



Table 31 SUMMARY OF ACTIVITY STATISTICS - AIRBORNE, INC., 1999-2001



DHL Worldwide Express



Table 32 SUMMARY OF DHL OPERATIONS CAPABILITIES - WORLDWIDE



Consignia, Plc



Royal Mail - www.Royalmail.Com



Post Officetm - www.postoffice.co.uk



Parcelforce Worldwide - www.parcelforce.co.uk



Postwatch



Postcomm



Table 33 SUMMARY OF IMPORTANT CONSIGNIA NETWORK INDICATORS



Deutsche Post World Net



Table 34 SUMMARY OF REVENUE AND STAFFING DISTRIBUTION DEUTSCHE POST WORLD NET (%)



TNT Post Group (Tpg N.V.)



MESSENGERS AND COURIERS



Association of Messenger & Courier Services (AMCS)



Messenger Courier Association of the Americas (MCAA)



NYSCMA, Inc.



Messenger Service Association of Illinois (MSAI)



Purolator Courier Ltd (Purolator)



MAIL AND PARCEL CENTERS



Table 35 PROJECTION OF REVENUE - MAIL AND PARCEL CENTERS, THROUGH 2007



Associated Mail and Parcel Centers, Inc. (AMPC)



THE ELECTRONIC PAYMENT OF BILLS AND INVOICES



The Electronic Payment of Bills and Invoices (Continued)



Table 36 ACH PAYMENTS VERSUS TRADITIONAL CHECK PAYMENTS, 2000 AND 2001 (MILLION OF UNITS)



Citibank Speedpay



THE INTERNET



Table 37 SUMMARY OF INTERNET TO TRADITIONAL MAIL SERVICE COMPARISONS



CONCLUSIONS



USPS CURRENT PERFORMANCE



Organizational Focus



Bottom Line Focus



Product Performance



Array of Competitors Is Increasing



OVERALL



USPS Will Get Its Operation Under Control and Survive



Distinct Changes Will Be Required



Demographics and Technology Will Alter the Face of the Mail Industry



Demographics and Technology Will Alter the Face of the Mail Industry (Continued)



BUTTRESSING THE USPS

EXISTING PRODUCTS/SERVICES



OVERVIEW



MAIL OPERATIONS



System Applications



Induction/Collection System Applications



Address Information System (AIS)



NTAC Flats Processing



Automatic Tray Handling System (ATHS)



Flats Remote Encoding System (FRES)



The Universal Tray System (UTS)



Flat Sequencing System (FSS)



Productivity Savings Summary



Table 38 INDUCTION/COLLECTION SYSTEM APPLICATIONS SAVINGS RESULTING FROM EFFICIENCIES AND ENHANCED SYSTEM APPLICATIONS, THROUGH 2007 (DOLLARS IN MILLIONS)



Mail Distribution System Applications



Automated Package Processing System (APPS)



Productivity Savings Summary



Table 39 MAIL DISTRIBUTION SYSTEM APPLICATIONS SAVINGS ACCRUING FROM IMPROVED SYSTEM APPLICATIONS, THROUGH 2007 (DOLLARS IN MILLIONS)



Return Mail System Applications



Address Change Service (ACS)



Internet Change of Address (ICOA)



Fastforward System



Postal Automated Redirection System (PARS)



Productivity Savings Summary



Table 40 RETURN MAIL SYSTEM APPLICATIONS SAVINGS RESULTING FROM EFFICIENCIES AND IMPROVED RETURN MAIL SYSTEM APPLICATIONS, THROUGH 2007 (DOLLARS IN MILLIONS)



Mail Delivery System Applications



National Change of Address (NCOA)



Internet Change of Address (ICOA)



Drop Ship Product



Five-Digit Zip Product



Z4CHANGE Product



ZIP+4 Product



ZIPMove Product



Delivery Point Packager (DPP)



Delivery Operating Information System (DOIS)



Productivity Savings Summary



Table 41 MAIL DELIVERY SYSTEM APPLICATIONS SAVINGS RESULTING FROM EFFICIENCIES AND IMPROVED MAIL DELIVERY SYSTEM APPLICATIONS, THROUGH 2007 (DOLLARS IN MILLIONS)



Tracking System Applications



Tracking System Applications (Continued)



Table 42 TRACKING SYSTEM APPLICATIONS SAVINGS RESULTING FROM EFFICIENCIES AND IMPROVED SYSTEM APPLICATIONS, THROUGH 2007



Equipment Requirements



Table 43 MAIL OPERATIONS EQUIPMENT REQUIREMENTS MAIL/INDUCTION/COLLECTION EQUIPMENT REQUIREMENTS



Table 44 MAIL OPERATIONS EQUIPMENT REQUIREMENTS MAIL DISTRIBUTION EQUIPMENT REQUIREMENTS



Table 45 MAIL OPERATIONS EQUIPMENT REQUIREMENTS RETURN MAIL EQUIPMENT REQUIREMENTS



Table 46 MAIL OPERATIONS EQUIPMENT REQUIREMENTS DELIVERY EQUIPMENT REQUIREMENTS



Table 47 MAIL OPERATIONS EQUIPMENT REQUIREMENTS TRACKING EQUIPMENT REQUIREMENTS



SALE OF STAMPS



Supermarkets, Pharmacies and Other Large Retailers



USPS Vending Machines



Contract Postal Units



ATMs



Other



Note



Table 48 COMPARISON OF ACCESS OPTIONS FOR THE SALE OF POSTAGE STAMPS



Table 49 BUTTRESSING USPS - POSTAGE STAMP SALES, PERCENT OF PURCHASES AT OTHER THAN POST OFFICE COUNTERS, THROUGH 2007



Table 50 PRODUCTIVITY SAVINGS, THROUGH 2007 (MILLIONS OF DOLLARS)



STAMP CONSIGNMENT AGREEMENT



STAMP CONSIGNMENT AGREEMENT (CONTINUED)



STAMP CONSIGNMENT AGREEMENT (CONTINUED)



AMERICAN BANK NOTE COMPANY REVISED ARTICLE 9 QUESTIONNAIRE



AMERICAN BANK NOTE COMPANY …QUESTIONNAIRE (CONTINUED)



POS ONE SYSTEM



Table 51 BUTTRESSING USPS - BRANCH POS SYSTEMS SAVINGS RESULTING FROM INSTALLATION OF POS ONE SYSTEM, THROUGH 2007 ($ MILLIONS)



NEW PROCEDURES

OVERVIEW



Table 52 BUTTRESSING USPS SUMMARY OF SAVINGS RESULTING FROM EFFICIENCIES AND NEW INITIATIVES, THROUGH 2007 ($ MILLIONS)



Table 52 (CONTINUED)



MAIL OPERATION APPLICATIONS ARE BECOMING MORE EFFICIENT



DISTRIBUTION OF STAMPS WILL BE DONE IN A MORE COST EFFICIENT MANNER



IMPLEMENTATION OF NEW POS FUNCTIONALITY IS PROVIDING EFFICIENCIES IN THE FRONT AND BACK OFFICE



PROFILES



AMERICAN BANK NOTE COMPANY (ABN)



American Bank Note Company (ABN) (Continued)



DIEBOLD, INC.



U.S. BANCORP



APPENDIX

GLOSSARY



GLOSSARY (CONTINUED)



GLOSSARY (CONTINUED)



GLOSSARY (CONTINUED)



GLOSSARY (CONTINUED)



GLOSSARY (CONTINUED)



THE MAIL INDUSTRY TASK FORCE (MITF)



OVERVIEW



MITF REQUIREMENTS



Table 53 SUMMARY OF MAIL INDUSTRY TASK FORCE REQUIREMENTS



Table 53 (CONTINUED)



Table 54 MAIL INDUSTRY TASK FORCE (MITF)



Table 54 (CONTINUED)



Table 54 (CONTINUED)



Table 55 MITF COMMITTEE CO-CHAIRS



PROFILES



Symbol Technologies, Inc. (Symbol)



Progressive Auto Insurance (Progressive)



Harte-Hanks, Inc.



Pitney Bowes, Inc.



R.R. Donnelley



The Spiegel Group



Meadwestvaco Corporation



Advo, Inc.



Quadgraphics



DST Output



Directmailquotes.com



Stamps.Com



The McGraw-Hill Companies



Time, Inc.



Time, Inc. (Continued)



JCPenny Company, Inc.



Capital One



Acxiom Corporation (Acxiom)
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