The parcel delivery space is quickly becoming overrun with participants — from stalwarts like FedEx and UPS to upstarts leveraging gig economy drivers utilizing cars and vans — to the point that small and medium-size businesses looking to ship items face a dizzying array of options.
One provider familiar to all, though, believes it has a winning formula to garner a greater share of the parcel business that is now e-commerce-driven and time-sensitive: the U.S. Postal Service.
“A lot of small and micro businesses don’t think of us but, hey, we are at their door every day,” Jakki Krage Strako, chief commerce and business solutions officer and executive vice president for the Postal Service, told Modern Shipper. “They know their carrier who is bringing them their mail. We are in every community. Our employees live in their communities.”
The Postal Service first began trialing USPS Connect in 2021 in Texas but last month announced it was expanding the program nationwide with a phased rollout that will see it reach every customer the agency serves — which is every address in the U.S. — by the end of this year.
“We [offer] a very good price for customers that are able to inject [parcels] deeper and deeper into our network, and the deeper they can inject into our network, the cheaper the [cost to deliver that product is],” Strako said.
She said that USPS Connect’s goal is to give businesses, especially smaller businesses that are looking to take advantage of e-commerce opportunities but are straddled with high shipping costs through FedEx (NYSE: FDX), UPS (NYSE: UPS) and others, a path to profitable sales.
The rollout, part of the Postal Service’s Delivering for America plan, includes USPS Connect Local, USPS Connect Regional, USPS Connect National and USPS Connect Returns.
- USPS Connect Local allows businesses to offer next-day service in all locations, with same-day delivery, Sunday delivery and pickup options in select locations. It includes USPS Connect Local Mail, a first-class mail option for documents up to 13 ounces. Businesses can inject their USPS Connect Local packages and mail at the receiving dock of the designated postal facility or take advantage of free en route pickup when their carrier delivers their mail. Free flat-rate bags, boxes and envelopes are available via USPS Click-N-Ship.
- USPS Connect Regional provides businesses next-day regional and delivery of Parcel Select packages and Parcel Select lightweight packages.
- USPS Connect National provides delivery solutions through first-class package service, Parcel Select Ground and Retail Ground.
- USPS Connect Returns allows businesses to offer customers returns with free en route pickup by their carrier or drop-off at a nearby post office.
Strako said what USPS Connect is ultimately doing is opening up the Postal Service network, which was really only available to larger shippers with high volumes, to everyone. Connect Local includes access to the Click-N-Ship platform that allows customers to buy postage online and print labels. There is no minimum number of packages for Local, Strako said, which delivers items the same day within local ZIP codes if dropped off at the local drop-off location between 5 and 7 a.m. On-demand pickup is available for a fee, as is marketing collateral for businesses.
“If it fits in that flat-rate box or polybag, it’s one price and they don’t have to worry about size or weight,” Strako said.
For customers looking for service outside local ZIP codes, USPS Connect offers Regional and National programs. There are 159 Postal Service plants for Regional and National customers to use for drop-off. Regional customers must ship a minimum of 50 packages at a time to use the service, and carriers do not pick up packages at the business.
Strako said customers are able to get shipping discounts by handling a portion of the shipping process themselves — delivering the items to a Postal Service plant.
National has additional shipping options, including time frames for delivery, she said.
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The USPS Connect program is designed to be a win-win proposition for the Postal Service and customers, Strako added.
“We have pricing standards that we have to comply with,” she said. “When we can bypass operations, then if we don’t incur the cost, we are able to take that out of the pricing.”
Strako said the Postal Service offers advantages over other shipping companies because of its mission: delivery to each U.S. address six days a week, and seven days for some customers. This is particularly true when it comes to apartment and office complexes.
“We have access to every mailbox; we have access to every building,” she said. “A lot of our competitors don’t have access to every building unless it is granted. So I know if I order something it will be delivered. That is a huge differentiator.”
The Postal Service also has legal authority to investigate package thefts, providing another tool to address concerns surrounding that issue, Strako added. There is also consistency in delivery.
“Deliveries are being made later and later in the day [by other providers], and knowing my carrier and knowing who is arriving at my door is important,” she said. “Our carriers are delivering packages out on their routes … People know what time of day we are going to be there and can count on it.”
USPS Connect is being rolled out throughout the year, but carriers should be getting additional information for customers, including collateral materials to leave for those who are interested.