In consecutive filings with the Postal Regulatory Commission on February 10, the Postal Service revised two of its competitive product categories, continuing its ongoing restructuring of package services overall.
First-Class Package Service
In the first filing (docketed as CP2023-113), the USPS announced it will rename First-Class Package Service as “USPS Ground Advantage,” raise its weight limit to seventy pounds, and revise its price structure. (First-Class Mail, from which FCPS was separated, remains a market-dominant product.) The USPS stated in the filing that
“The First-Class Package Service product was generally utilized for small fulfillment parcels, weighing up to 15.999 ounces. The Postal Service has determined that the First-Class Package Service brand name has, over time, become closely associated with such lightweight packages. With the upcoming expansion and enhancements to that product, the Postal Service believes a new brand name is needed that better suits a comprehensive ground package offering up to seventy pounds. Accordingly, the Postal Service performed market research on various options for a new brand name befitting this expanded ground package offering. The research indicated that the “USPS Ground Advantage” name will create an identifiable brand in the package market that is closely associated with the broader postal brand and clearly indicates the product is a strong option for customers’ ground shipping needs. …”
The agency added it also would be
“… removing Certificate of Mailing and Certified Mail from the list of available optional features under USPS Ground Advantage”
and making
“… two additional minor corrections to the MCS for USPS Ground Advantage, to clarify that Dimensional Weight pricing is available up to Zone 9, and to clarify that the Dimension Noncompliance Fee applies to the product. The Postal Service discovered these errors after it executed the filings in Docket Nos. MC2022-81 and MC2022-82, and is today providing notice of these minor corrections.” Pricing for the renamed service would begin in four-ounce increments (4, 8, and 12 ounces) before stepping to 15 ounces and then to one pound (16 ounces). Higher increments are one-pound steps to seventy pounds. Other criteria and pricing are carried forward unchanged from First-Class Package Service.
Parcel Select
In the second filing, (docketed as CP2023-114), the Postal Service announced changes to the existing Parcel Select product that
“… are predominantly structural in nature, to simplify and streamline the Parcel Select product across all price categories. Classification changes are being proposed to establish the Destination Hub (DHub) price category, eliminate the machinable/nonmachinable price categories under Parcel Select Destination Entry, and align the entry/zone options across the various Parcel Select price tables. New prices will be established for the DHub price category, and ounce-based rates for Parcel Select Lightweight will be presented in 4, 8, 12, and 15 ounce increments.”
In announcing its new “DHub” destination entry, the USPS stated it “expects that this new price category and associated rates will encourage growth at new facilities.” The agency made no comment about what these “new facilities” would be, but those being repurposed under its nascent network redesign process, and the “sort and delivery centers” being established are likely candidates.
The USPS added that eliminating the separate machinable and non-machinable price categories would “aid in reducing customer confusion,” though it didn’t explain why it believes such confusion has emerged despite having the machinable/non-machinable distinction in place for decades.
In addition, the Postal Service stated it
“… intends to align the place of entry and zone options across the existing Parcel Select Destination Entry and Parcel Select Lightweight price tables, to further simplify and streamline the Parcel Select product. These changes will better align the Postal Service’s offerings with the future state of the mail processing network and the Postal Service’s package processing capabilities. Replicating the rate options between the Destination Entry and Lightweight price tables should aid in reducing customer confusion and help mailers optimize entry points for their Parcel Select packages. …”
The USPS noted that it planned to implement the changes for both FCPS and Parcel Select on July 9, likely in concurrence with anticipated price changes. Given the Postmaster General’s interest in growing Postal Service package volume, more changes may well lie ahead.
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