This episode dives into the major transformations in the USPS delivery network under the Delivering for America plan. Hosts Karla Kirby and Jonathan Castillo chat with Juan Nadal, USPS Executive Director of Strategic Sales & Account Initiatives, to learn how the Postal Service is modernizing its infrastructure to boost efficiency, lower costs, and improve sustainability, and how that’s led to the success of solutions like Ground Advantage. Discover how USPS is setting new standards in shipping to meet the evolving needs of businesses and consumers across the nation.
This week on Mailin’ It, Karla and Jonathan are joined by Juan Nadal, USPS Executive Director of Strategic Sales & Account Initiatives. Juan discusses the Postal Service’s efforts to streamline package delivery and the broader impact the network transformation will have, giving USPS the tools to support the evolving shipping needs of major retail partners and everyday customers alike. Learn how these advancements are helping USPS compete and what the future holds for customer-focused initiatives like USPS Connect eCommerce and Informed Delivery integration. For shipping professionals or anyone curious about USPS's modern approach to delivery, tune in for a fascinating look at the Postal Service’s efficient customer-focused future.
Karla Kirby:
Hi everybody. Welcome to Mailing it, the official podcast of the United States Postal Service. I'm Karla Kirby.
Jonathan Castillo:
And I'm Jonathan Castillo. When we began transforming the Postal network a few years ago as part of the Delivering for America Plan, one of our main goals was to create a more logical, efficient network. We saw network modernization as a great way to cut costs, of course, but we also saw it as laying the foundation for new products. A little over a year ago, we tested that idea by introducing USPS Ground Advantage. Fast forward to this year and our efforts are passing the test with flying colors. Ground Advantage's success gives the Postal Service a more affordable and reliable offering to meet our customers shipping needs now and as they change over time.
Karla Kirby:
And to find out just what that means for the Postal Pervice, for many of the world's biggest retail and online merchants and for all of us who count on reliable package delivery service every day, this episode, we're speaking with Juan Nadal, our executive director for Strategic Sales and Account Initiatives. Juan, welcome to Mailin' It!
Juan Nadal:
Thank you Karla, Jonathan for welcoming me to the Mailin' It podcast. It's such an honor to join the incredible community. Thank you for the warm welcome and for all the hard work you do to keep this community vibrant and informative. I'm looking forward to some great discussions today.
Jonathan Castillo:
Juan, we've talked a lot on this podcast about the Postal Service's network modernization under the Delivering for America Plan, and your work, from what I understand, goes hand in hand with that transformation. Why don't we start by talking about your role here at the Postal Service and what your team does.
Juan Nadal:
Jonathan, great question. The Postal Pervice network transformation as part of the Delivering for America Plan is a comprehensive initiative aimed at modernizing our operations and enhancing service reliability. This transformation is designed to ensure we meet the evolving needs of our customers while maintaining our commitment to universal service. My team plays a crucial role in this transformation. By working closely with our largest shippers and new customers, we provide customized shipping solutions that leverage our latest network enhancements and our vast delivery capabilities. This allows us to optimize shipping processes and ensure that our customer's needs are met efficiently and effectively. So one key benefit of our transformation is the opportunity it provides to enhance our customer's experience. We offer competitive pricing, which ensures that our services remain accessible and cost effective. Additionally, we prioritize security providing reliable and secure delivery options that our customers can trust. We also offer comprehensive return solutions, making it easier for customers to do business with us while managing the reverse logistics. Another key item we hear more and more from our customers is around sustainability. And sustainability is a core focus of our transformation efforts. We are committed to implementing environmentally friendly practices across all operations. This includes investing in new delivery vehicles and optimizing our transportation network to reduce our carbon footprint.
Jonathan Castillo:
Something that I've always been curious about, Juan, you're the director of strategic sales and account initiatives. What's the difference between strategic sales and account initiatives and just sales?
Juan Nadal:
Yeah, it's a great question Jonathan. So ultimately my team was developed and put together just over a year ago, and the team has kind of divided up into a couple different segments. One part of the team we're focused on just new sales and we have a team under our director of new business and acquisition, Mr. J Smith and what he's responsible and his team is going after new customers and they full solely focus on developing relationships and building relationships with customers who've never done business with the Postal Service before. All these initiatives, part of the Delivering for America plan and developing new products as well as developing new solutions has opened the door to develop a team and implement a team that can go out and meet customers that we never had a solution to provide in the past. And it's been really exciting to work with them and to see this, the fruits of their labor as we've built more and more relationships with customers who just a year ago if we knocked on the door, would never even open the door for us.
And then on the account initiative side, I have a team of account managers that manage relationships with our largest customers and they're there to support them in every single step of their way, whatever they need, whenever things come up. It's to make sure that they have the most relevant and Up-To-Date information. And as things are rolling out with the Delivering for America plan, it's ensuring that they're up to date and that we're working with them. You know, one thing that's important as we work with our large customers is getting to understand their business. We can always go back and look at how we can implement things to make their business better and make them better as well as they do that for us. We have some very smart companies out there and very, very good people that we get to work with and it's really exciting to be able to have those conversations because they're happening more frequent now than they ever did before. And a lot of that has to do with what we're doing and the changes that we're making within our organization.
Jonathan Castillo:
You mentioned a little bit earlier about one of the things that your team does is you reach out to try to acquire new customers, new business. What types of businesses are we talking about specifically with your team? Is it small businesses? Is it mom and pop shops, middle-sized businesses, large you know, corporations?
Juan Nadal:
Yeah, so the new business acquisition team and most of my team focuses on large companies, what we internally would call an enterprise account or an enterprise relationship. And we spend most of our time working directly with them. For the middle market consumers, where we see there's a great opportunity, we have a lot of sales efforts going on right now to engage and meet more and more customers that fit into that niche or that customized segment of customers. And it's really been exciting because we have now the products and solutions to be able to offer where we haven't been so competitive in that space.
Karla Kirby:
So Juan, when you look at it this way, the Postal Service isn't just an American institution. It operates as a business that serves a wide range of customers and it needs to serve them well in order to compete. So how does your job depend on the products we offer and how well our network operates?
Juan Nadal:
Karla, both are incredibly important. We need a modern efficient network to deliver on time and keep costs down. Introducing new products can generate additional revenue and my team is spearheading efforts with new customers to support the United States Postal Service achieve financial stability. The package delivery market is highly competitive. In fact, it's probably more competitive now than ever. New products enhance customer solutions, helps us stay competitive. I hear it often when speaking with major customers and prospects and the conversations are completely different now than they were just a few years ago.
Jonathan Castillo:
You mentioned the conversations are completely different than a few years ago. Can you tell me or elaborate a little bit more on what ways are those conversations a little bit different?
Juan Nadal:
Jonathan, I just had two conversations with two different customers today. And speaking with customers about the investments the Postal Services making and to transforming our network, integrating mail and packages. As part of the Postmaster General's ten year Delivering for America Plan, we're investing tens of billions of dollars to optimize facilities, streamline operations, modernize our information technology systems and improve transportation and logistics, optimizing our transportation with improved utilization. We are investing in our future empowering our organizations to serve customers long into the future. And we've made important changes to our product lineup over the past year that includes last year's launch of the USPS Ground Advantage, which has been incredibly successful and an absolute hit. Our transformation is happening and it's happening on a massive scale.
Karla Kirby:
So there's certainly a lot to talk about there. But before we unpack that and get into how our products and services are evolving through Delivering for America, it would be great if you set the scene for us. How did things work before the Postal Service started modernizing its network a few years ago and before it launched Ground Advantage?
Juan Nadal:
Postal's always been banging on doors to get customers to use our priority mail products. And prior to delivering for America Postal had a full network air product, but no truly effective ground products. We used to have Parcel Select for example, which went through our network distribution centers, also known as our NDCs, but our ground service was slower than we wanted it to be. With service standards up to eight days and sometimes taking even longer, we relied on heavily on what we call consolidators to pick up parcels from customers, sort those parcels and process them for final delivery by the Postal Service, what we call our last mile delivery.
Jonathan Castillo:
So it seems obvious that we needed to modernize both our way of thinking and our actual network. What are we doing now to lay the foundation for products like USPS Ground Advantage or USPS Connect?
Juan Nadal:
Jonathan, great question. Throughout the country we are instituting a hub and spoke model built around 60 regional processing and distribution centers. Internally we refer those as RPDCs. These centers are being connected to transportation based on unified flow of mail and packages traveling across the network on the ground. Think of it like a spider web with mail and packages traveling from hub to hub, from our facilities that serve large regions to those serving local communities and vice versa. The interplay between these facilities is freeing the Postal Service to do a lot of things beyond our previous capabilities, including package integration with informed delivery. Informed Delivery is a platform with millions of residential customers opening an email from the Postal Service every day. When I meet with customers, they're raving about the extra impressions they're getting with informed delivery notifications. It is a game changer for staying up to date on incoming mail and packages, I believe Bob Dixon spoke on a recent Mailin’ It podcast, which I hope everyone had a chance to listen to. You see, we want the merchant to have an increasingly powerful tool to engage and connect with the recipient. We want the recipient to have increasingly more useful and convenient experience relative to their package deliveries. Oh, and I did mention it's absolutely free. This is just another example of our network changes enabling the Postal Service to provide a broader range of products and services. We're also highly focused on the overall experience of the package recipient.
Karla Kirby:
So Juan, one thing that's really helped us over the past year has been the launch of Ground Advantage. It came onto the market at a time when the Postal Service was trying to win market share from its competitors in the package delivery business. How has it managed to be so successful?
Juan Nadal:
Karla, we now have a more competitive product to sell. It's plain and simple. Ground Advantage is a reliable, affordable way to send packages up to 70 pounds with service standards at two to five days, depending on the distance. The result has been very positive. Postal has a nationwide product reaching about 80% of the population. Since it was launched in July 23, Ground Advantage has accounted for 375% increase in volume for packages over one pound, a near quadrupling in the number of packages in that weight class, allowed Postal to retire First Class Package service, a mixed air and ground product. Ground Advantage, combined Parcel Select Ground, First Class Package Service, and Retail Ground. All of those products were retired in July of 2023.
Jonathan Castillo:
Juan, you pointed out that products like USPS Ground Advantage were simply not possible before Delivering for America. And that's really because the plan put us on track to provide the most affordable, reliable, and best in class service by optimizing our service and air transportation network and expanding our package processing capacity. Now that we've made such substantial progress in modernizing the Postal network, from your point of view, how have these improvements impacted our customers and our partners?
Juan Nadal:
Well, we're now bringing package volume into our own network and our offerings are changing to take advantage of this growth. As Postal's ground network has emerged in recent years, the Postal Service has changed its strategy for doing business with those consolidators mentioned earlier. Customers are now coming to the Postal Service to use our shipping products. One popular example is the Postal Services Connect e-commerce program, which offers online merchants and sellers access to a number of Postal Service shipping options. There are about a hundred different platforms and marketplaces offering Connect e-commerce today. This innovative program offers platforms and marketplaces, the exclusive benefits like discounted rates, no volume commitments and seamless integrations with the Postal Services APIs and our manifesting systems. I recommend everyone stay tuned as we explore more about how the Postal Services is transforming the shipping landscape for e-commerce platforms.
Karla Kirby:
So for merchants that we may have in our listening community, how would they take advantage or get more information about the products and services that we are offering now at the Postal Service?
Juan Nadal:
That's a great question, Karla. You know we ultimately always love to recommend everybody to visit usps.com. We have a ton of information on there and if you wanted to go even deeper, you can look at other things such as Postal Pro and really get into the weeds about the Postal Service and the different products and solutions that we have out there. And I mentioned earlier about the Connect eCommerce program and you can visit online@usbsconnectecommerce.com to learn a little bit more about that program and the values that that program offers to all our customers. Again, it's exciting times as we're developing and planning new programs to support all customers. And I also wanted to add a little bit more to that, Karla. I talked and mentioned something about APIs and not many people know what an API is. And I'll be honest, a year ago I had no idea what an API is and now it's part of my daily conversations, whether it's talking to our CIO team internally or with customers about different types of integrations and service and solutions that we offer. It's really exciting the things that we're able to do today and provide real time information is what our customers are demanding.
Karla Kirby:
So I'm gonna ask for our fellow community Layman - API that is an acronym for?
Juan Nadal:
I you almost thought you were gonna get me on that one, but it's an application program interface and it allows customers to call, whether it's our labels or our service standards or our rates for each and every single individual package. Now, I won't be able to go into all the details of how they work, but it just goes to show these are things that we weren't offering just a few years ago and it's become more and more of a popular conversation with our customers trying to better understand how they can get real time information from us. And it's exciting to see how we're developing and implementing all these solutions and programs to be able to give the customers what they're looking for.
Karla Kirby:
So before we let you go, and we've gotten a wealth of information, would you agree, Jonathan?
Jonathan Castillo:
Oh, absolutely.
Karla Kirby:
Let's touch on how the Postal Services network improvements are not only cutting costs, as you mentioned, but also lowering our impact on the environment. What do you tell your clients when they ask about the Postal Services sustainability efforts?
Juan Nadal:
Karla, now more than ever, customers are interested in doing business with the organization. Taking measures to lower their carbon footprint is becoming a part of the daily conversation. In the first quarter of fiscal year 2024 alone, we achieved a savings of nearly a half a billion dollars in reduced transportation expenses. Much of this came from reducing extra trips and cutting underutilized trips. In fiscal year 2023, we eliminated more than 208,000 underutilized trips, which reduced our surface transportation expenses by almost $112 million. This represents a savings of over 39 million miles driven and nearly 57 million tons of CO2 emissions avoided. We continue to shift mail from the air to the ground transportation network and reduce trips between facilities due to better truck utilization and transportation schedules. This will decrease carbon emissions by reducing demand for cargo flights and adding volume to pre-existing truck routes. In fiscal year 23, this resulted in a savings of 600 million in air network expenses. It's just an exciting conversation we continue to have with our customers who are demanding this more and more from us.
Jonathan Castillo:
Juan, you've absolutely given us just a wealth of information about the Postal Services historic modernization. Before we let you go, is there anything that you'd like to leave our listeners with?
Juan Nadal:
You know, I would just say it's been exciting times to be a part of the Postal Service and be a part of all these changes. The Delivering for America Plan has been transformational. It's really exciting to see it and just really excited to see our customers participate along with us on the journey. Jonathan, thank you so much for having me. Karla it was a pleasure wishing you and all the community nothing but the best as we continue to grow the business together.
Karla Kirby:
Thank you so much for joining us.
Jonathan Castillo:
It was great having you.
Juan Nadal:
Thank you.
Karla Kirby:
And now it's time for the Did You Know segment of the podcast when Jonathan and I each share interesting US Postal Service facts? Jonathan, wanna get us started?
Jonathan Castillo:
Sure thing. Karla, did you know that at one point the Postal Service tested flying post offices in order to speed up mail delivery?
Karla Kirby:
I assume these aren't actual post offices soaring through the sky?
Jonathan Castillo:
Not quite. By the mid 20th century, the post office department's railway mail service had been processing and delivering mail across the US for nearly a hundred years. But after World War II train travel was in decline and as a result there were fewer railway mail train cars.
Karla Kirby:
So were they using planes instead?
Jonathan Castillo:
Yes, exactly. The Postal Service was moving more and more mail via aircraft. And since quite a bit of the mail sorting process happened on trains, the Postal Service decided to try to do the same thing on airplanes, hence the flying post office.
Karla Kirby:
Okay, well, was that a success?
Jonathan Castillo:
Unfortunately, no. Since the flights were so much quicker than train travel, clerks weren't able to sort enough mail to justify the system. So the flying post office really never took off. Plus the clerks found it particularly difficult to stand, move and sort mail in a moving aircraft.
Karla Kirby:
Well, Jonathan, that's understandable. I can barely walk up the aisle when I'm on a flight. I wonder how the clerks would fare on a hovercraft.
Jonathan Castillo:
I'm not sure. Why do you ask?
Karla Kirby:
Well, Jonathan, did you know that the Postal Service uses a hovercraft to deliver mail in southwestern Alaska?
Jonathan Castillo:
I had no idea, but it sounds awesome.
Karla Kirby:
In 1997, the US Postal Service began using a hovercraft to deliver to remote villages in the state's Yukon Kuskokwim River Delta. With mail delivery to such remote places still difficult, the hovercraft has been an operation to this very day. It usually only carries parcels and bypass mail, AKA large items like auto parts that bypass post offices. But the hovercraft delivers First Class Mail if the weather is too bad and flying an airplane is too risky.
Jonathan Castillo:
Okay, that makes sense. How big of a hovercraft are we talking about here?
Karla Kirby:
Well, actually it's pretty big. It's a 70 foot long hovercraft and can travel on both land and water. Today the hovercraft transports surface volume to seven villages along the Kuskokwim River.
Jonathan Castillo:
So in theory, I could have my mail delivered via hovercraft.
Karla Kirby:
In theory, yes. But seeing is how mail trucks work just fine here in the nation's capitol, I doubt that that will happen. And that wraps up this edition of Did You Know.
So Jonathan, another great episode. Juan provided a wealth of information - very interesting about our modernization and where we're going with DFA.
Jonathan Castillo:
Absolutely. Karla, I think it was just remarkable hearing what Juan had to say about all the operational improvements that the Postal Service made, really how they've helped, you know, kind of fuel the, the, the successful launch of new services. Like, you know, he mentioned USPS Ground Advantage and USPS Connect. Like Juan said, it's an exciting time to be a part of this modernization effort that we're in the middle of.
And that wraps up this episode of Mailin’ It. Don't forget to subscribe to Mailin’ It wherever you get your podcasts to make sure you don't miss the next episode. And follow along on Instagram @US Postal Service, X - formerly known as Twitter @usps, and on Facebook.