In a previous post, “It takes a Village Post Office, but for what?” we questioned the financial rationale for VPOs and asked why many of them were now being placed in densely populated areas. Now there’s more reason to pose such questions.
A couple of days ago, an article in The Press Democrat touted the “debut” of some new Village Post Offices in Sonoma County, north of San Francisco. A couple of them are right in the heart of Santa Rosa, where there are seven or eight post offices, all of them operating at regular hours, some with Saturday hours as well. This map of Santa Rosa shows VPOs in red and the nearby post offices in blue.
The Postal Service has been putting VPOs in other urban areas, and California seems to be a popular location. Nearly a third of the 74 VPOs created in August and September 2014 were in California. In San Diego, where there about 25 or 30 post offices, the Postal Service has set up a half dozen VPOs. In Sacramento, there are now five VPOs, surrounded by 16 real post offices, as you can see on this map.
The usual justification for VPOs has been that they provide additional access to retail postal services in rural areas where the post office has had its hours reduced under POStPlan. But Santa Rosa is not a rural area. It has a population of over 170,000. Sacramento and San Diego are much bigger.
The old rationale for creating VPOs doesn’t hold up anymore, so the Postal Service has come up with a new one. According to Postal Service spokesman James Wigdel (in an email to the Press Democrat about the new VPOs in Sonoma), the VPO is “an innovative step toward generating revenue to ensure the long-term viability of the Postal Service.”
Wigdel explains that “the Postal Service continues to face declining first-class mail volume and therefore must continue to adapt to the demands of our customers to retain and grow our revenue base.”
But VPOs don’t really grow revenues. If you want to mail something, it might be a little more convenient to buy stamps or pick up a flat-rate box at a VPO, but you would probably have done your business at the post office, so it’s not as if the VPO is generating new revenue. The VPO is simply siphoning off revenues from the traditional post office.
The actual justification for VPOs is not customer convenience or growing revenues. Rather, VPOs — like all “alternate retail access channels” — are supposed to be a less expensive way for the Postal Service to bring in revenue. As more and more customers learn to use these alternatives, the Postal Service can cut window hours at post offices, reduce their staffing, and save money. Eventually, it becomes easier to close post offices completely.