- Since 2000, the number of post offices in the United States fell slightly while post office revenue and transactions declined sharply.
- The Postal Service’s current retail strategy is focused on expanding self-service options and government services at existing post offices.
- International posts implement a range of retail strategies, including outsourcing, diversification of services, and expanding access beyond traditional post offices.
- Over the past 25 years, USPS’s retail network has not evolved to adapt to changing population trends or to changing demand for mail.
- There are opportunities for the Postal Service to evolve its network, including establishing criteria to strategically manage the network, expanding government services, introducing new alternative access options, and requesting subsidies to help preserve rural service.
Throughout the Postal Service’s 250-year history, local post offices have been one of the most visible parts of the agency and a critical component of binding the nation together. Today, USPS’s brick-and-mortar retail network is the largest in the U.S with 33,000 locations across the entire country. Congress gave the Postal Service the power to manage its post office network but also established guardrails to protect rural service: post offices cannot be closed simply for being unprofitable. Still, the number of post offices has declined slightly since 2000, and over the same period customer visits and post office revenue have seen even larger declines. While the overall post office network is still profitable, more than half of individual locations do not cover their costs.
Though the Postal Service has developed and implemented initiatives related to improvement and modernization of its retail network and services, the agency does not currently have a clear and comprehensive strategy to evolve the post office footprint to align with changing populations or shifts in mail demand. Over the years, the agency pursued various initiatives to reduce costs, increase revenue, and serve communities through its retail network. However, broader proposals and initiatives to shrink the overall footprint or to outsource more locations have been unsuccessful due to multiple factors, including strong stakeholder resistance.
Many international posts have also kept their number of post offices relatively stable in recent years. However, to adapt their retail networks, the posts studied by the OIG have focused on outsourcing their post office functions to third-party retailers or franchisees and expanding alternate methods of access such as parcel lockers or partnerships with other retailers. Additionally, almost all the posts studied offer diversified services beyond their postal functions, including financial services, identity services, and partnerships with other government agencies.
The Postal Service must provide access to essential postal services nationwide and also cover its costs. Potential opportunities both USPS and policymakers can consider to help manage these dual mandates include:
- Establishing Universal Service Obligation (USO) criteria for retail access.
- Expanding alternate access points.
- Exploring broader government service opportunities.
- Requesting rural subsidies that could help preserve critical infrastructure.
