Saturday, January 26, 2013

So Far, FSS Is A Step Backward, USPS Data Indicate

The Flats Sequencing System is costing the U.S. Postal Service more than it is saving, information submitted by USPS this week indicates.

USPS's response to a question from the Postal Regulatory Commission showed that FSS has pushed up the costs of mail processing far more than it has decreased delivery costs.

USPS invested more than $1 billion in the huge FSS machines to automate the labor-intensive process of handling catalogs, magazines, and other flat mail, but so far the results have been mixed at best. Meanwhile, the agency continues to seek special rate increases on some types of flat mail, such as Periodicals, on which it claims to be losing money.

The cost of delivering Carrier-Route-sorted Standard-class mail rose 2.32 cents per piece, from 16.54 cents to 18.87 per piece, in just two years almost solely because of a 48% increase in mail-processing costs, USPS told the PRC.

"An examination of mail processing costs by cost pool shows that the bulk of this rise is due to FSS sorting. Specifically, FY 2012 FSS sorting cost per piece for Carrier Route is 1.84 cents while the amount for FY 2010 is likely fairly small [because few FSS machines were operating then]," USPS wrote.

"Delivery costs (both city and rural carrier) have declined by 0.06 cents
[from 10.98 to 10.92 cents] per piece." the agency added. "Included in this overall change in delivery cost per piece is a decline of 0.49 cents per piece for cost segment 6 in-office city carrier labor costs between FY 2010 and FY 2012, despite a 5.9 percent rise in city carrier cost per workhour. This likely reflects the benefits of FSS sorting."

Not rocket science
In contrast to carrier-route pieces, the mail processing cost of non-carrier-route Standard flat pieces has risen only 6% in the past two years, according to USPS data. The reason for the contrast is not rocket science.

For ZIP codes not served by FSS, carrier-route bundles are nearly ideal and therefore result in the lowest rates, except for saturation mailings. Such bundles move through the postal system without being opened until they reach the letter carrier who will actually deliver them. Bundles containing pieces for multiple carrier routes or ZIP codes require additional handling and are therefore more expensive for the Postal Service.

But for ZIP codes served by FSS machines, carrier-route bundles are of little benefit to USPS. Like other bundles, they have to be opened and fed into a machine. In fact, the ideal bundle for FSS is supposedly four to six inches thick, many times larger than the typical Standard or Periodicals carrier-route bundle.

The big benefit of FSS is at the delivery units. When the process is working, a carrier receives all flat mail in delivery sequence, which cuts down on the time they spend preparing the mail.

USPS has not broken out mail-processing costs for Periodicals in the same way as for Standard. But the two mail classes' pieces and carrier-route bundles are so similar that the mail-processing costs for Periodicals carrier-route copies most likely have seen a dramatic increase as well.

And with carrier-route Standard and Periodicals pieces probably representing more than half of all FSS mail, it seems unlikely that FSS is saving enough on delivery costs to counter the system's impact on mail processing.

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23 comments:

Anonymous said...

..."when it's working, a carrier receives all flat mail in sequence".....then it must NEVER be working - as I STILL get BUCKETS of raw flats!

@dryMAILman said...

There is a better way.

Anonymous said...

admit it does not save and sell it to a third world country

Anonymous said...

just declare victory and go home.

Anonymous said...

Both APWU and NALC should get together and create a clerk/carrier position that can case carrier routes during down time from doing clerk work. You can then eliminate FSS and the billions it costs.

Anonymous said...

All they put in FSS sequence is bulk mail. They don't tell you how much is put in backwards.Most days it is one tray,while you case three buckets.That one tray saved on office time translates to double wasted time on street.There is NO savings unless you case it in.

Coast Office Worker said...

Disagree with Anon@646 about creating that clerk/carrier position.
Past efforts to do similar programs such as night casers and routers have generally been failures with poor results. Always a problem when the employee is not the one who has ownership of the route as there is the tendency for poor work habits.
Canada Post has or did have a program where one group of employees strictly cased the mail and another group of employees strictly delivered the mail. Neither position is particularly appealing to me.

Anonymous said...

I'm already cut on hours. Lost about $900 a month going from ptf to NTT and only getting 30 hours yet management works carriers As clerk crossing craft for 3 hour each every morning in my office. We file weekly and this cost more money paying the carriers and paying the grievances.

Anonymous said...

I'm stunned. You mean a management program did not fulfill it's desired monetary savings? Now that's a shock. Remember, DPS was supposed to be "6 & 2". You know, they continuously shoot themselves in the foot by not...........asking the people who actually do the work what they think. They for some reason operate perpetually without input from the crafts. Go figure.

Anonymous said...

The postal service is in need of a upper MANAGEMENT overhaul......These folks don't have a clue how to run a business or for that matter how to deliver mail efficiently. Ever since automation in dps letters and FSS flats, our mail delivery has gotten worse and later and later every year. Forwards are a JOKE. I have seen a decline every year in service but lately it's been on a fast track like the sinking Titanic. So many dollars are wasted in mis management and no accoutability for it.

Anonymous said...

just a correction it does not sort all the flats. we had it in northvill mi. and you were lucky if they nsorted 50% its gone routes are longer GREAT JOB GUYS 41 yrs in northville.

Anonymous said...

scrap it and the pmg

Anonymous said...

I would like to see a follow up article on the P&DCs that had FSS machines that were closed due to consolodation.......Where are these machines now becasue no private company would bid to disassemble/transport/reassemble them......How many are there and are they just collecting dust somewhere? Used for approximately 2 years.......

Anonymous said...

Unfortunately, this article is being too nice.
Carrier rt presort,coming out of 761
is constantly torn apart and helicoptered into buckets. Any savings to be had by presort flats, is always lost so that some supervisor at the plant can make numbers.
Station mgr. just shrugs his shoulders and walks away.

Anonymous said...

People are awared of big corruption existing at the management.

Anonymous said...

they did not mention anything about this monster ripping magazines and ad mail to shreds.....we have 4 of these things and they are broken down more than they work.....sell to China for scrap metal and declare victory. from small minds come small products. I just keep adding to my UPS & FDX stock as a hedge against this dump.

Anonymous said...

They need to take into account the effect on the route of FSS versus rural carriers using the one bundle method which is way faster.

john snyder said...

Several factors contributed to the cost overrun, part postal to blame and part to customers. About the same time the FSS system was being developed, USPS decided to penalize mailers that used flats and raised rates on them to encourage them to switch flats to letters. Many flats contained one or two pieces of paper and could be folded easily and inserted into an envelope and put on DPS machines. The economy went sour and many mailers cut back on the use of flats and standard mail. Preparation costs remained about the same as carriers used to cut open bundles and sort into case. Now a mailhandler does the same thing. All Carrier Route sorted flats must be sequenced in order to receive benefits of CR sort prices. They are already in order and just need to be cased. Run on FSS and you need 2-3 passes to put the flats in order. Processing costs went up because you are using billion dollar machines and it takes many manhours savings to meet those costs. The Postal Service anticipated growth in flats when in fact the growth went to letters instead.

Anonymous said...

The FSS program was not implemented to save money or increase service. it's sole purpose is to eliminate the clerk jobs at the local stations.
The "F" stands for FLAT not post cards,small parcels,catalogs and plastic bags full of magazines that they jam into these machines just to prevent a clerk from touching it at the station to justify managements position that there is no work for these people

Anonymous said...

If we can move forward from DPS and FSS, now we need machines that can go house to house and put mail from the vehicles into the mailboxes by the front door. We could save billions!!!

Anonymous said...

Case The FSS and save some FFS...Go back to four shelves...Lets the workers do there job.

R. M. Coleman said...

Too much has been invested to turn back. Nothing can be gained by scrapping the machines. However it would be more beneficial to utilize the existing system and let the FSS be cased in or at least collate it with our cased mail. One or two bundle systems are easier to manipulate. There has been no designation as to how we are to carry a third bundle. We were left to figure it out on our own. This was a knee jerk reaction to initiate the FSS. Although it added complications it can be helpful as long as management allots an appropriate amount of time to accomplish our daily duties of not only delivery but preparation of said deliveries.

Anonymous said...

Half a tray of fss case it in what is another 20 mins in the office when parcels are not ready