How Can USPS Survive When Feds Use UPS & Fed Ex?

There can be no doubt that the United States Postal Service has been financially hurting since the advent of email and the internet.  Millions of Americans use the cell phones, email and various forms of social media to keep in touch with family friends.  The days of letter writing are almost gone.  Many of us also pay some or all of our bills online, thus avoiding the cost of a stamp and envelope to mail them.

The Post Office has been trying different innovative ways to attract business such as their flat rate shipping boxes.  In the shipping industry, the USPS has had a tough road competing with UPS and Fed Ex.

However, their revenue continues to decline while its operating costs continue to climb.  They have been shutting down smaller Post Offices and in some areas have stopped Saturday mail delivery, but they are still losing money.

Since the United States Postal Service is part of the US government, wouldn’t it make sense for the government to use the USPS?  Evidently, they aren’t.  According to recent reports, 25 federal agencies have contracted with UPS from 2010 to 2013, resulting in their receiving $122 million of government business.  Fed Ex received contracts from the feds for the same time period worth $48.5 million.

So how much business did the federal government do with its own Postal Service?  Would you believe that during the same three and half year time period that they only received $29.3 worth of government business?

The reason?  It’s because UPS and Fed Ex are cheaper to use than the USPS and the government agencies contracting with other mail carriers did so to save taxpayer dollars.

If the federal government won’t do business with their own Postal Service due to higher costs then why should they expect anyone else to?