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In his annual state of the business address to the mailing industry, USPS postmaster general John E. Potter outlined a roadmap for recovery and reaffirmed the Postal Service’s focus on adapting to changing customer needs and a changing marketplace.



Despite what Potter called, “one of the most difficult economic climates any of us have ever experienced,” the Postal Service managed to cut spending by $6bn in 2009, while maintaining record levels of customer service and trust.



The Postal Service ¯ already the Most Trusted Government Agency for the past five years ¯ was ranked the third Most Trusted Company for Privacy for 2009, according to Ponemon Institute consumer survey results. The Postal Service moved up three positions from last year, and only eBay and Verizon ranked higher in levels of customer trust.



“There’s no other business that has such an active, collaborative and productive partnership with so many great customers in so many communities,” said Potter. “And we’re going to keep working to make that even stronger.”



One of the ways the Postal Service is increasing customer value is by pursuing aggressive marketing strategies and pricing and product innovations. Earlier this year, the Postal Service launched one of its largest and most integrated advertising campaigns promoting ways businesses and consumers can simplify shipping with flat-rate boxes, one of the best bargains on the marketplace.



In addition, recent Summer Sale and Saturation Mail incentive programs have made it easier for businesses to continue results-driven direct marketing campaigns in a down economy.



The Postal Service also has been working closely with Congress and the Administration on legislative actions that would help it manage huge statutorily-imposed cost mandates, provide greater flexibility and allow the Postal Service to operate more like a business.



“The simple fact is that the status quo is unacceptable,” said Potter. “The Postal Service must have the ability to manage its business, to adapt quickly to the needs of our customers and the marketplace. And our business model must change to reflect the reality of a volatile economy and a communications marketplace that has been undergoing a transformation as profound as anything that has ever come before.”



Potter cited three key areas in which the Postal Service is seeking legislation:



1) Changes to the accelerated payment schedule to pre-fund retiree health benefits statutorily mandated by the Postal Accountability and Enhancement Act of 2006. Under current law, the Postal Service is required to make an annual payment of more than $5bn into a trust fund. Legislation currently under consideration in Congress would ease the financial pressure while the Postal Service pursues the long-term actions necessary to cut fixed costs.



2) Ability to adjust the capacity of the Postal Service’s network to bring it in line with reduced mail use. Eliminating Saturday delivery could save the Postal Service as much as $3.5bn a year.



3) Flexibility to expand product offerings into new areas that leverage the Postal Service’s unmatched scope, reach and presence of its distribution, transportation and retail networks to achieve their full revenue potential.



The Postal Service receives no tax dollars for operating expenses and relies on the sale of postage, products and services to fund its operations.



In the meantime, Potter said the Postal Service is staying focused on its mission to provide universal, affordable service to all Americans.



“Service is still our priority. And we’ll continue to improve service as we implement more demanding service measurement systems,” he pledged.