What a U.S. Postal Service Shutdown Could Mean for Your Business

kathryn by Kathryn Hawkins on November 9, 2011
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The U.S. Postal Service is failing to deliver. The much-maligned government agency, which has been losing business to email correspondence and private carriers like UPS and FedEx, forecasts a $20 billion loss by 2015. To avoid default, the Postal Service is closing offices and pushing to end Saturday delivery, but these measures may not be enough. A government bailout could keep the service going, but what could happen if it doesn’t?

Here are a few ways that a Postal Service shutdown might affect your small business.

  • Shipping catalogs and direct mail would no longer be cost-effective. Many businesses take advantage of the Postal Service’s bulk-rate discount to send catalogs, circulars, and other promotional materials. If the service ceases to operate, businesses may lack reasonably priced alternatives. This mean you might need to stop sending snail mail and rely solely on the internet. For enterprises such as MagnetStreet, a promotional magnet company, this could be a huge blow to business: Marketing coordinator Greg Herman says that catalog mailings are essential to the company. Customers “get so saturated with email and social media or phone calls or whatever — that that just becomes noise,” he tells CBS Minnesota.
  • Private regional services could replace first-class mail delivery at higher costs. The Postal Service is legally required to provide universal service throughout the U.S., which gets expensive. It takes a lot of fuel to transport mail from Maine to Alaska. Private, regionally operated services could supplant the Postal Service, but without any laws governing their rates, prices could skyrocket; the farther you want to send an item, the more you may need to pay.
  • Local stores could serve as P.O. Box substitutes. The Postal Service is already turning to local businesses for shipping services, and Amazon recently launched a prototype delivery locker at 7-Eleven stores, where customers can have packages sent if they’re not home to receive them. If you run a retail store, you may be able to offer mailing options and storage as an added service.
  • Your email account would be essential. It’s already nearly impossible to get by without an email account, but if the Postal Service shuts down, electronic correspondence will become crucial. Switzerland’s government postal service, for instance, has partnered with a U.S.-based start-up, Earth Class Mail, to offer customers the option to choose whether they’d like to receive hard copies of mail or whether they’d prefer to it scanned and sent via email. Private companies could offer similar options in the U.S. to avoid unnecessary shipping costs.
kathryn

Kathryn Hawkins is a business writer for Intuit and is passionate about solving small business problems.

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