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USPS has released revenue figures for the second quarter of 2018, which revealed the postal operator's shipping and packages revenue grew by US$445m or 9.5% (read more here). But how many more parcels did the operator handle between January 1 and March 31, 2018?

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Time for change

Patrick Armstrong, CEO of IoT developer Snaile, explores some of the restrictions posed by outdated USOs and explains how they can be avoided using modern technology.

Most postal services have a Universal Service Obligation (USO), which, among other provisos, covers first-mile letter mail collection. These legally binding acts stipulate that at least one collection of post be made every working day from each “access point” – a street letter mailbox for outgoing mail for the purposes of this discussion. However, with the rapid decline of the volume of letter mail, along with the advent of new technology, visiting street letterboxes to both check and collect mail is becoming a costly measure, in both financial and environmental terms. Clearly then the USOs are in need of a change.

Many USOs are dated. For example, the UK’s Postal Service Act dates back to the year 2000. The USA’s USO, although not clearly defined by legislation, stipulates delivery and frequency should be maintained at 1983 levels. The dated nature of these acts does not take into account that first-mile street letterbox networks are competing with digital documents. Despite not taking into account that network size is no longer matching the current and future letter mail volumes (and revenues), postal operators are mandated by law to physically check the entire box network daily.

This daily check is a fixed operational cost to operators, which cannot be supported by a falling revenue stream. Currently no mechanism exists to alter this drain on business revenue and the laws do not allow postal operators to check these boxes by other means, such as using electronic indicators.

Adopting low-cost retrofit technology to take over the physical checking achieves the purpose of the USO’s prime collection directive, which is to collect all outgoing mail in a timely manner. It eliminates the cost of checking boxes that are empty through route planning applications, and creates a real dataset (big data) to monitor each box’s usage. This enables the operator to make more informed business decisions with respect to network and fleet reductions, while adapting, in real time, to the rapidly changing letter mail environment.

This type of first-mile street letterbox technology goes even further than just operational cost reduction for postal operators. It also supports the environment. Postal operators in the Universal Postal Union (UPU) may be familiar with the 25th Congress resolution that recognizes the importance of reducing negative environmental impacts. This should include eliminating useless vehicle trips to empty street letterboxes that contain no mail. Similarly, first-mile street letterbox technology can help those operators achieve greater efficiencies with the International Postal Corporation’s (IPC) Environmental Measurement and Monitoring System (EMMS).

Could it just be a question of interpretation of the USO to physically check boxes? It is time that USO legislators enable (and make known to postal operators) a mechanism in the law to allow checking of boxes electronically? This technology allows checking many times a day, yet without the environmental and fleet costs.

Bio:
Patrick Armstrong is the CEO of Snaile and the winner of the 2016 Digital Innovation of the Year Award by Postal and Parcel Technology International for its first- and last-mile IoT technology, which creates first-mile operational cost savings and last-mile consumer mailbox revenues. Armstrong is an accomplished entrepreneur and business leader who has continued delivering an impressive success portfolio across multiple industries. Since 1999, he has helped to develop and launch five companies which have all enjoyed both acclaim and distinction.

April 24, 2017

 

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