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2015 Report on Form 10-K United States Postal Service 17
As a percentage of operating revenue, Shipping and Packages generated 21.9%, 20.0% and 18.7% for the years ended 2015,
2014 and 2013, respectively. As a percentage of total volume, Shipping and Packages represented 2.9%, 2.6% and 2.3% for
the years ended 2015, 2014 and 2013, respectively. Prices for these Competitive services increased an average of 3.5% in
May 2015, 2.4% in January 2014 and 8.1% in January 2013. Pending PRC approval, on October 16, 2015 we filed a notice
of our intent to increase certain Competitive service prices by an average of 9.5%.
The following table details our operating revenue and volume for Shipping and Packages for the years ended September 30,
2015, 2014 and 2013 by each service:
(in millions) 2015 2014 2013
Shipping and Packages Revenue:
Priority Mail1$ 7,751 $ 7,233 $ 7,020
Parcel Select, Parcel Return, Standard Parcels 3,516 2,736 2,202
Package Services 806 812 810
First-Class Packages22,233 2,002 1,771
Priority Mail Express 779 760 794
Total Shipping and Packages revenue $ 15,085 $ 13,543 $ 12,597
Shipping and Packages Volume:
Priority Mail11,025 934 924
Parcel Select, Parcel Return, Standard Parcels 1,997 1,605 1,418
Package Services 564 547 542
First-Class Packages2908 847 792
Priority Mail Express 36 36 39
Total Shipping and Packages volume 4,530 3,969 3,715
*Note: The totals for certain mail categories for the prior year have been reclassified to conform with classifications used in the current year. These
reclassifications did not impact total Shipping and Packages revenue for the prior years.
1Includes Standard Post which is a retail-only product classified as Market-Dominant. Standard Post is priced identically to Priority Mail for Zones
1-4 and is functionally equivalent to Priority for those Zones.
2Includes First-Class Mail Parcels and First-Class Package Services.
Shipping and Packages revenue continues to show strong year-over-year growth, as a result of our successful efforts to compete
in ground shipping services and the “last mile” e-commerce fulfillment markets, which include Sunday deliveries. Volume
has also experienced strong growth as we responded to customers’ increased use of online shopping, which provided a surge
in package volume with a record number of packages delivered during the fiscal year 2015 holiday season.
Ground shipping services has also grown in response to e-commerce fulfillment, as companies strive to reduce costs. In
addition, successful marketing campaigns have helped fuel this growth. To accommodate the surge in volume and to minimize
service disruptions, we implemented Sunday package delivery during the first quarter of 2014 for certain large markets.
Priority Mail
Priority Mail, including Standard Post, is our flagship Shipping and Packages service, accounting for 51.4%, 53.4% and
55.7% of Shipping and Packages revenue for the years ended 2015, 2014 and 2013, respectively. This service is a convenient
and fast way for customers to send documents and packages requiring expedited transportation and handling. The increase in
year-over-year growth of Priority Mail revenue and volume are the results of growth in e-commerce and the success of our
sales and marketing initiatives, most notably the Priority: You campaign.
In September 2014, the Postal Service changed Priority Mail prices. This change included a reduction in the average prices
for businesses and other customers who use Commercial Plus and Commercial Base online shipping services for heavier-
weight packages. The price change included an average increase of 1.7% for Priority Mail services offered at post offices and
other postal retail outlets. The changes were intended to offer more competitive pricing and build on Priority Mail’s popularity
with customers.