How Freight Brokers are Becoming a Necessity for the United Postal Service
In the late 1700s, courier service was a milestone in breaking away from British rule and played (and continues to play) a critical role in our independence. Fast forward a few centuries where population has exploded and the need for mail delivery has become required in order to function today. But in recent times technology has changed the landscape of the United States Postal Service while basic resources have begun to run low. Enter the private sector.
USPS is no stranger to adapting and evolving to meet the needs of the American people. Since the beginning there has been an ever-changing definition to the “standard” way that mail is delivered but one thing that has never changed is how important the transportation industry to the agency.
“The post continued to subsidize the nation’s transportation infrastructure. In the East, railroads replaced mounted couriers and stagecoaches. To connect the coasts, the department first financed steamships to carry the mail through the Isthmus of Panama. Then it invested in stagecoaches, which sped the mail from Missouri and Tennessee, where the railroads stopped, to California, enabling vital communications during the gold rush. In 1869, the great transcontinental railroad was completed. The mail was a lifeline connecting Western settlers with loved ones back home.” – smithsonianmag.com
For years USPS used their own fleet to keep up the timely delivery of mail and parcels across the country while keeping their use of contractors and outside resources to a minimum. Recent data has shown, though, that as of the past near decade, the scales have shifted.
“A FreightWaves analysis of the Postal Service’s top suppliers reveals that the agency’s reliance on brokers has boomed in the past nine years. The Postal Service counted three brokerage firms among its top 150 suppliers in fiscal year 2013, totaling $85 million. By fiscal year 2021, at least 11 firms that primarily provide brokerage services were on that list, representing a spend of more than $620 million.” – Freightwaves.com
Most of all types of freight today is moved by freight brokers and it has become a necessity for those that want to ship goods efficiently. Now it seems the USPS has been getting in on the advantages of using brokering in order to get their demands met, especially since 2020.
With the onset of the pandemic, USPS suffered many of the same troubles private business endured including insufficient staff, those that could work would get sick and be out of the office and burn out affected many which turned into unsatisfactory performance overall. Business itself dipped as lockdowns were put in place as not many letters were going out and people opted for online communication as a way to have less contact with the outside world.
The return of workers has not been what is needed to get up to speed so that has brought about an even more far-reaching hand into the freight brokerage pool, if even just for local deliveries.
Another change in 2020 was the change of the postmaster to General Louis DeJoy. Under his leadership we have seen “intensifying” of the freight brokerage spend and there are many that believe it is saving on costs. As every new year seems to bring with it a new hurdle for the economy, we suspect that USPS will continue to adapt as needed to keep serving the public.
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