USPS Starts Regional Parcel Service

USPS Starts Regional Parcel Service

The U.S. Postal Service, looking for more package business from online retailers, is launching a regional parcel delivery service with "competitive pricing" aimed at high-volume businesses that ship goods to consumers.

Parcel Select Regional Ground is aimed at "e-commerce merchants looking to boost sales by offering free or discounted shipping charges for online purchases," said Gary Reblin, vice president for domestic products. "It has tremendous appeal for commercial shippers requiring a cost-effective ground service for delivery of packages over shorter distances."

The service is the latest bid by the USPS to use pricing and service freedoms Congress granted in recent years to bolster sagging postal volume.

The growing world of e-commerce has helped keep parcel shipping in the United States relatively strong even as Internet capabilities, from e-mail to online banking, have cut deeply into basic postal letter volume.

But the lively competition in online retailing also has pressed companies in that arena to offer steep discounts, including offers of free shipping. Big brands such as L.L. Bean and Macy's have joined Internet retailers such as Zappos in the free shipping parade.

The USPS is targeting that arena with a regional delivery service for business-to-consumer shippers with volume commitments of at least 10,000 pieces annually and says the pieces can weigh up to five pounds and must have barcodes for "intelligent mail" tracking.

The service may push some shippers to look more closely at their use of distribution centers and use of third-party "drop-ship" services since it is based on the USPS Network Distribution Center locations and where pieces come into the postal system.