USPS must learn from mail plant consolidation woes, says OIG
With the US Postal Service now in the process of consolidating its mail processing network, its Inspector General has called for lessons to be learned from a particularly problematic consolidation carried out last year.
The Office of the Inspector General (OIG) found that the consolidation of a single mail plant in Maryland, close to the US capital, led to “significant” delays in mail services and a $558,000 increase in transport costs.
The investigation into the transfer of mail processing from the Frederick, Maryland, plant to the Baltimore processing plant from October 2011 to January 2012 found that delayed mail volumes increased by nearly 200% during the consolidation, to 4.6% of total mail volumes.
Customer service scores also declined during consolidation, falling by 17.2% compared to the same period the previous year in the Frederick area, and 12.2% in the Baltimore area, the report said.
The Postal Service is set to close 48 of its 461 area mail processing plants across the United States in the next two months, with plans to close a further 92 in January and February 2013.
The consolidation effort is seeking to right-size the network, which was designed to process as much as 300bn items a year, while volumes have fallen 25% in the last five years to around 168bn a year. USPS has been losing more than $25m a day because of its dwindling mail volumes and punishing pension and healthcare payment schedules set by Congress.
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