Mendoza School of Business

US Postal Service to end Saturday letter delivery

Published: February 6, 2013 / Author: Mendoza College

The following is an excerpt from a BBC article that quotes Management Professor James O’Rourke about the US Postal Service stopping Saturday delivery. To read the entire article visit: US Postal Service to end Saturday letter delivery

The US Postal Service plans to end Saturday delivery of first-class mail by August, in its latest cost-cutting drive.

The move would save about $2bn (£1.3bn) a year, according to the agency.

But the USPS will still deliver parcels six days a week, a service that has grown by 14% since 2010.

The financially troubled postal service lost nearly $16bn last year and has defaulted twice on required payments to the US government.

“Our financial condition is urgent,” Postmaster General Patrick Donahoe told reporters on Wednesday.

The 237-year-old institution is in the middle of a major restructuring, although it is projected to remain in the red this year.


Analysts say the postal service is making the change because it has little other choice.

“It’s unclear whether the USPS has the legislative authority to take such actions on its own, but the alternative is the status quo until it is completely cash starved,” James O’Rourke, a professor of management at the University of Notre Dame, told the Associated Press.


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