Most corporations are familiar with the terms process and network reengineering. It’s a discipline that helps ensure that networks remain fine-tuned to the needs of its users, which helps maximize productivity and cost savings.
The USPS has evaluated several network design alternatives in recent years, and in recent months has embarked on a plan to transform Bulk Mail Centers (BMC) to Network Distribution Centers (NDC). According to postal officials, the new network will consolidate the processing of originating mail into fewer sites to achieve greater operational efficiency and reduce transportation costs—while expanding the surface transportation reach for more products. The core principle of the NDC concept is to fill up containers and fill up trucks as early in the network as possible and to dispatch as deep into the network as possible. Some NDCs will also specialize in specific mail types, such as inbound-only shipments.
Phase I of this transformation was completed on July 17, three weeks ahead of schedule. To date, the results have been impressive. In Springfield, for example, service performance on package services improved from 71% to 88%; in Philadelphia, transportation utilization improved from 66% to 82%. Similar results have been reported in other pilot districts.
In addition to improved service and minimal changes in mail preparation, network redesign has resulted in significant cost savings. As such, the national implementation of NDC has been accelerated – with a goal to complete the entire transformation by November of this year.
At the present moment, the USPS advises there will be no changes to entry points for mailers. Over time, however, they will evaluate entry points and may request mailers to enter mail based upon the Tiers of NDCs. As always, we will keep you posted on any new developments.
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