USPS Piloting Grocery Delivery Service
As online delivery in the supermarket industry continues to gain steam, the United States Postal service (USPS) said it will pilot a new delivery service following the loss of billions in revenue during the last several years.
The USPS' new "Customized Delivery" is slated to begin testing on Oct. 24, with the testing period to last for two years, according to a proposal sent to the Postal Regulatory Commission on Tuesday.
Under the program, the USPS will partner with retailers to deliver groceries and other prepackaged goods to customers from 3 a.m. to 7 a.m. Retailers would bring the deliveries to their local post offices between 1:30 a.m. and 2:30 a.m.
"Grocery delivery services are expanding across the nation, with businesses ranging from the nation's largest retailers, to niche operators, to the popular car service Uber entering the marketplace," the proposal stated. "With its operational reach, the Postal Service has an opportunity to provide retailers a nationwide solution that offers a trained workforce and the trust and reliability of the Postal Service brand."
USPS partners with Amazon
The USPS is currently delivering groceries for Amazon.com in the San Francisco area, averaging 160 totes per day throughout 38 ZIP Codes. The two-month test in that area is set to end in mid-October.
If launched permanently, the partnership with USPS will likely facilitate AmazonFresh's expansion, which currently operates in San Francisco, Los Angeles, San Diego and Seattle.
Based upon forecasts, the USPS aims to generate $10 million per year from the service, dependent upon the "number of participating retailers, the scope of their businesses … and the demand for grocery delivery among consumers in the market place," the proposal stated.
"The Postal Service's core function is delivering to our customers - this market test is us doing exactly that," USPS Sr. Public Relations Representative Sue Brennan told Progressive Grocer. Brennan declined to offer further details on the pilot, including retail partners and the cities in which it will be tested.