Businesses face new reality with USPS

The winds of change are coming for commercial clients who depend on timely mail delivery.

Beginning Aug. 5, the U.S. Postal Service will officially terminate regular Saturday mail service across the nation, not including package delivery or post office box mail. And business owners worried about Springfield losing its sorting operations, which could further delay service, have a full year to adjust.

Springfield’s mail processing center, 500 W. Chestnut Expressway, is scheduled to close its sorting operations in February 2014, according to U.S. Postal Service Mid-America District spokesman Richard Watkins. Roughly 250 workers are employed at the Chestnut Expressway facility, but he said USPS is not planning to close any retail locations or fire any workers in Springfield. Since 2006, Watkins said USPS has reduced its nationwide workforce by more than 193,000 through attrition.

The sorting center closure would send most local mail to Kansas City, though he said the USPS would work with business customers on a one-on-one basis to try to meet their needs.

“There are variables involved with some things that are drop-shipped, in other words, prepared – (such as) publications – and we’ll need to address those on a case-by-case basis,” Watkins said, indicating not all commercial mail would automatically travel to K.C.

He said variables include how mailings are prepared, where they are going, the volume of the mailings and sorting requirements.

Ozark-based Print Group Inc. owner Jay Wacha said the sheet-fed commercial printer mails roughly 300,000 pieces per month for about 40 clients, sending out such items as an alumni association letter for Columbia College, magazine materials for the American College of Forensic Examiners Institute, and postcards and newsletters for Central States Industrial Equipment & Service Inc.

Wacha doesn’t expect a dramatic impact from the USPS changes.

“I’ve had a fevw conversations with people we work for, and they are not cutting their numbers. They are not cutting their projects,” Wacha said. “It’s just more about scheduling.”

Sales at Print Group were up 15 percent in 2012, and Wacha is projecting another year of double-digit growth due in part to point-of-sale printing, or display pieces, for retailers.

Jim Scheele, estimator and customer service representative for Print Group, agreed the USPS moves were workable for the firm’s clients. “Some mailers may reschedule their mailings or change a drop date. If they have a critical deadline where the loss of a Saturday delivery would cause them a little bit of grief, they might move it up a day or two. It’s basically just a scheduling issue for us and our clients,” he said.

In 2011, the USPS began considering a five-day delivery schedule and closing 252 mail processing centers – including those in Springfield and Cape Girardeau. Working ahead of the proposed changes, Watkins said last year the Kansas City processing center has postmarked about 140,000 pieces of mail on the weekends for Springfield since July 2011, an amount that is roughly half of Springfield’s weekday volume.

Scheele said it seems USPS officials have responded to the local market since announcing the consolidation plans.

“At first, they were set up to really move quickly on that and I think they realized what their customers needed – the general public and their business customers – and I think they’ve made a smart business decision,” Scheele said.

Watkins said 80 percent of USPS customers now support the change to a five-day delivery schedule based on its own market research. Package deliveries on Saturdays, he said, would continue due to healthy demand. In the last two years, he said package delivery volume is up 14 percent. Ultimately, he said the scheduled changes were born out of necessity.

“The Postal Service is doing the right thing by ensuring our customers across the country have good, efficient, universal and affordable mail service. In order to accomplish that, we simply have to have the flexibility to change the way we collect, sort and deliver the nation’s mail based on the changing ways our customers – both residential and commercial – are using the Postal Service,” Watkins said.  

One company that appears to be getting hit on both sides of the USPS changes is Bentonville, Ark.-based Community Publishers Inc. CPI President Steve Trolinger said the company comprises two divisions: Nowata Printing, comprising two print shops, and Neighbor News, owner of 20 community newspapers in Missouri, Arkansas and Oklahoma.

Neighbor News, which operates publications such as the Bolivar Herald-Free Press and Christian County Headliner News, will have to establish a new carrier on Saturdays for its daily newspaper in Harrison, Ark., the Harrison Daily Times, Trolinger said.

However, Trolinger said he is most concerned about the potential impact Postal Service changes will have on CPI’s printing customers. Nowata prints about 4 million commercial products including 200,000 newspaper pieces per week, including those for Neighbor News.

“I’m concerned about the ripple effect. If we don’t have mail delivered on Saturdays, how much will that delay mail being delivered on the other days?” Trolinger said, adding that print materials the company has traditionally expected to be delivered in one day, could now potentially take three to four days to reach its destination.

Still, he said the issues largely amount to scheduling challenges, and it is too soon to say whether there will be any impact to the company’s bottom line.

“We’re going to have to educate our customers on a new reality for when they need to have their materials printed and delivered,” Trolinger said. “There’s no doubt the post office is still a very efficient way to deliver advertising messages, but when you take away one of the six days, it is going to have an impact. We are not positive what all the ramifications will be, but we are going to keep a close eye on it.”

Wacha said a privately run operation would likely make the same moves the USPS has in place.

“From a business standpoint, I understand it,” Wacha said.