Dive Brief:
- The U.S. Postal Service hasn't been able to convince online postage providers to offer Connect Local Mail, the agency’s same-day and next-day local delivery service, according to a filing last month with the Postal Regulatory Commission.
- Of the four providers the USPS has had discussions with, three declined the offer and expressed a lack of interest in offering it on their platforms, the May 10 filing said. Discussions were ongoing with the final provider at the time of the filing.
- Connect Local Mail, under the Postal Service's Connect Local umbrella, is focused on speedy document delivery within a local area. The agency has flagged UPS and FedEx as potential competitors for the offering.
Dive Insight:
The Postal Service said it is working to address issues with Connect Local Mail flagged by online postage providers as it attempts to convince the one company still considering use of the service. Obstacles flagged during discussions have included platform changes to make the service available to end users and the need to educate users on how to induct parcels for Connect Local Mail delivery.
"In addition, third-parties will need to establish methods of determining service availability, presenting and displaying service availability to end-users, and updating their systems to report sales of Connect Local Mail," according to the filing.
Tackling these concerns could help the Postal Service win over online postage providers like Stamps.com, Pitney Bowes and EasyPost, and boost the underwhelming revenue and volume its Connect Local Mail service has seen in market testing since 2022.
From Jan. 1 to March 31, Connect Local Mail made $3,531.15 in revenue on 1,197 pieces of volume, the USPS reported. It's an improvement from the $191.75 made and 65 pieces handled during roughly the same period two years ago, but whether that progress impresses the Postal Regulatory Commission — which authorized market testing for Connect Local Mail in 2022 — remains to be seen.
"Moreover, USPS Connect Local Mail volume was extremely low in FY 2023, which indicates that this service had minimal impact on customer satisfaction," a March report from the Postal Regulatory Commission said.
