Commentary
Congress, in the proposed
Postal Service Reform Act of 2021, is attempting to deal with the decades-long travails of the government enterprise that has lost $87 billion since 2007 and $9.2 billion just in fiscal year 2020. A key to improving USPS financial prospects in the future is their participation in delivering packages for the exploding ecommerce market.
Profiting From Packages
Historically, delivering first- and third-class mail was the Postal Service’s principal revenue source. But as individuals and businesses moved to electronic communications and transactions, those revenues plunged, from $37.6 billion in 2007 to $23.8 billion
in 2020. But the USPS bright spot is package delivery from growing ecommerce, bringing USPS $28.5 billion last year, more than from delivering mail. Indeed, from October through December, USPS ran a surplus of $318 million (
pdf), thanks to the growth in package deliveries. If anything, package delivery revenues are supporting the shrinking mail services.
