USPS to Slow Speed First-Class Package Service – Will Speed Up Some Priority Mail

USPS advised that it would begin implementing previously announced revised service standards for First-Class Package Service (FCPS) on May 1, 2022.

Last year, the modified service standards did take into effect for First Class flat mail on October 1. However, USPS chose not to introduce the same standards to First-Class Package Service until after the busy holiday season.

As part of its “Delivering for America” initiative, the Postal Service’s 10-year plan to achieve financial sustainability and service excellence, the revised First Class service standards give USPS additional transport time on long-distance package deliveries and realize increased network efficiencies.

In turn, this is supposed to help keep USPS from having to raise rates on these service levels further.

Although it did request approval from the Postal Regulatory Commission two weeks ago to raise rates for First Class flats starting July 10.

“Modifying select service standards is a key growth element and enabler of our 10-year plan. This action will contribute to our cost savings efforts and improve our reliability across all product classes, including our growing package market.”

Postmaster General and CEO Louis DeJoy

“By implementing the elements of our 10-year plan, we will deliver the consistent, reliable service that the American people and our customers expect and deserve and grow package volume, spurring revenue growth that can be invested back into the Postal Service,” added DeJoy.

As part of its announcement that the revised service standards would now apply to First-Class Package Mail starting May 1st, USPS stated that 64 percent of FCPS volume would be unaffected.

Furthermore, it said four percent would even be upgraded from a 3-day to a 2-day service standard, and for the remainder (32 percent), the service standard would increase by one or two days.

USPS Priority Mail to Increase Speed on Select Shipments

While this news will not be welcome by many online sellers and merchants that sell lower-priced and light-weight items that are often shipped with USPS FCPS, the Postal Service did also reveal a speed increase on select USPS Priority Mail shipments.

USPS is removing the extra day for Priority Mail transported by ground it introduced in April 2020 to account for ongoing global supply chain, transportation, and employee availability challenges across its network as a result of the COVID-19 pandemic.

However, due to ongoing air transport availability challenges, USPS will need to keep the additional day for Priority Mail shipments it transports by air.

The Postal Service also said that as part of implementing the new service standards for FCPS, the USPS is removing the extra day that had applied to FCPS as well.

The Inevitable

This announcement by USPS is a mixed bag as many sellers rely on First-Class Package Service when fulfilling orders on marketplaces like eBay and Etsy as well as their own stores.

Since announcing its 10-year “Delivering for America,” USPS has been making a lot of changes, many designed to help it become more efficient.

As USPS does not receive tax dollars to fund its operations, it must find ways to reduce its red ink. For years, the Congressional mandate that it fully pre-fund its pension program has been a major problem.

A bill passed this year with bipartisan support by Congress and signed by president Biden into law this month will help USPS to adjust its financial situation significantly while the Postal Service continues to improve its legacy network mostly designed to handle flat mail.

These changes in service levels were inevitable for the Postal Service to make its logistics network more efficient.

Recently, it introduced a new plan to help online merchants and smalls businesses to better service local or regional customers using mail services.

But it also introduced new fees on larger packages across its network that made shipping with USPS less attractive for many sellers.

With all these changes, online merchants and sellers must consider more than just one shipping carrier.

Clearly, USPS is positioning itself to handle small to medium-sized packages, providing affordable First Class services that may take longer, while also offering faster Priority Mail services that compete directly with UPS and FedEx standard ground service levels.

Online buyers want fast and free (or cheap) shipping and that is a major challenge for online merchants and sellers.

This latest news from USPS that it will slow down First-Class Package Services on long-distance package deliveries will not help, but it was inevitable. 

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