What is the difference between a Postal Service and Courier Service?
There is a big difference between Postal Services and courier mail services. Regular mail or mail delivered by the Post Service/Post Office is sent through the public postal service, whereas courier mail services are managed by private businesses.
Most people if given the option would prefer to use private mail services for everything, however, the reason many countries have a public postal service is that unlike most private sector couriers Public Postal Services are not supposed to be profit driven. As an example, Police serve the Public and if people became Police Officers only for the profit or if investors invested in the Police force so the Police Force would serve the investors needs only then the Police force would no longer be a Police force it instead would be Private Security Force.
Private Mail couriers are profit driven, which is why they tend to strike less, have better customer service, deliver sometimes within 24 hours across the world and have been known to wipe public postal services out of business. In many countries governments frequently have to bail out public postal services with taxpayer dollars or in countries like Canada, the public postal service might be granted privileges from the countries Government which allows them to monopolize certain areas of mail delivery thus raising the costs on the public they serve while at the same time making a profit at the public’s expense. This method can prevent bailouts, but it also makes the delivery market in that country less competitive as Private Delivery services fear encroachment on the public service.
What makes a Public Sector Postal Service essential and why governments will bail out them out revolves around what the Private Sector delivery services usually won’t do. Private Courier services have to pay close attention to costs, this is why most private courier services have no problem working together, with that said people residing in rural communities typically will not have mail delivered to them by Private Couriers without paying high costs.
Because Public Sector Postal Services serve the public they’ll often deliver to areas where the private sector courier services will not deliver too or will charge a premium to deliver too. This is one of the reasons why Public Postal Service are often given the Federal distinction and is why most governments refuse to make them 100% privately owned. Rural communities are important and their votes do count.
Regarding Private Courier service, yes it’s true that they can compete and in many ways outcompete a Public Postal Service, but the real question is if one or two private mail couriers reign supreme in mail delivery and both decide that they’d rather not deliver to certain area’s or they’d like to raise prices, unjustifiably how would a government remedy that situation in the event a few private courier companies freely decided to change their policies? This is why most Public Post Offices are usually worthy of a bailout.
The problems of course with most public services are typically the employees themselves who like anyone else want higher pay and safe secure retirements. The problem with this type of thinking in the public sector is that economies go up and economies go down. Meaning some years Private Sector is profitable other years the Private sector isn’t profitable.
If the government is running a deficit, it usually means that the government doesn’t have any money if the government doesn’t have any money, the public servants still expect to be paid. This is the difference between the Public Service and the Private Sector. When a private courier doesn’t make any money it pays its employees and then it declares bankruptcy when a public courier doesn’t have any money it asks for a bailout.
If a private courier isn’t profitable it has to find creative ways to be profitable, being that public services or public sector workers typically don’t understand the costs associated with running a business, they’re usually not incentivized to make any changes even when their operations aren’t cost-effective.
In my personal opinion, the public postal service should have a small section of it dedicated mail delivery. The bulk of the operations should be sorting. The actual delivery of parcels in the public post office should be done primarily by private couriers who bid on delivery projects. This is not to say that Public Postal services shouldn’t have their own fleet, but in order to minimize labor-related disputes the solution I outline here would be the most effective.
The sorting, in my opinion, is the most important function of a public postal service, leaving the deliveries to the private sector would minimize labor disputes, shrink the Public Postal services size and create a robust economy all on its own. The sorting centers would also be subject to independent audit so taxpayers would know their dollars were being spent efficiently.
Private Sector couriers as everybody knows already do what I outlined above, this is not to say that Private Sector couriers don’t run into unexpected problems, but unlike the Public Sector, Private Sector companies are treated like adults and not like children. So with my above recommendations for the Public Sector Postal Service along with what already exists in the Private Sector Postal Services a countries courier economy should run smoothly. Not perfectly but more efficient.
Interesting times ahead.