Could US Postal Service Turn to Same-Day Grocery Deliveries?

Courier ServiceThe Postal Service isn’t pleased with it’s financial state and hasn’t been for quite some time now.  It is indeed looking for change and the outgoing US Postmaster General Patrick Donahoe has mentioned some innovative measures for growth.  Reuters reported a few weeks ago Donahoe stated that not only can overcoming health burdens make the US Postal Service more profitable, but same-day delivery of groceries can too.  He will be leaving the Postmaster General position as of February 1st, yet he states the service needs greater control of its’ workforce and more flexibility in pricing and developing new products.

He stated the USPS could be profitable if it changes its’ business model and experimented with same-day delivery of packages and grocery deliveries as forward-looking tactics.  He stated, “There’s plenty of interesting opportunities going on, we think, from the standpoint of delivery, many different things.  The grocery business could be a multi-million-dollar business from our perspective … You can’t limit yourself to what you’re doing now.”  There are a number of retailers already involved in same-day delivery of their products that outsource to a same-day courier like 1-800 Courier to pick up and deliver items.

The USPS took a hit last year to make sure it financially covers the health retirement benefits for its’ workers decades ahead.  It is government required and has led to default in recent years, in addition to union opposition to the deals the USPS can make with retailers.  The report mentions the Postal Service has been losing billions of dollars for years, including $5.5 billion in fiscal 2014, despite cutbacks in the workforce, consolidation of facilities and other cost-cutting moves.

The mail giant strongly desires to get away from the hands of Congress, deeming it doesn’t have the autonomy to get itself out of the deep hole financially.  The article quoted Donahoe stating at the National Press Club, “Congress needs to look at the Postal Service as a business that is going to be a lot different in the coming years and it should view this as a positive, desirable outcome”.  With the way technology has morphed business done online, all it takes is the right innovation for the USPS to make become strong, i.e. delivering groceries same day.

Online retail is estimated to increase to $500 billion by 2018.  It is a viable avenue for the US Postal Service to take because it has the operational facilities and vehicle fleet to deliver a wide range of items within major US cities.  It already delivers our mail, therefore, delivering online products and groceries makes sense.  Metro Post, the USPS’s last-mile delivery service, already partners with Amazon to perform same-day delivery on Sunday’s in New York.  Expansion of Metro Post is a matter of partnering with more web-based and physical store retailers.

For online shopping, the company delivered 28 million packages on December 22nd last year, which was a one-day record for the USPS as a whole.  Time will tell whether the mailing company will be able to operate like a Dallas courier and see how it can thrive with same-day grocery deliveries.

Reference:  1.6.15,, Jason Reed, Outgoing U.S. postal chief hails grocery delivery, seeks innovation