2011 U.S. Postal Service Contractors: For Ninth Time, FedEx Is USPS’s Largest Supplier

Husch Blackwell's Postal Service Contracting practice group today released its list of the top 10 U.S. Postal Service suppliers for fiscal year 2011. For the ninth straight year FedEx claimed the No. 1 spot. Another air carrier, Kalitta Air, Inc., which transports military mail bound for Iraq and Afghanistan, claimed the second spot. The list is compiled by David P. Hendel, a partner in the firm who has served clients' postal contracting needs for 30 years. A list of the top 150 postal suppliers can be found here.

First-place FedEx transports Express Mail, Priority Mail and First Class Mail, and earned postal revenues of $1.495 billion in fiscal 2011 – an increase of $122 million from last year. Higher fuel prices may account for the increase. Another postal competitor, United Parcel Service, is the Postal Service's 11th largest postal supplier, earning $102 million in revenue – a $7 million increase from last year. Six of the top 10 postal contractors are in the transportation field.

“Once again, transportation and technology providers dominate the top rank of Postal Service suppliers,” said Hendel, who has compiled the list for over 15 years. Total agency spending on goods, services and facilities increased slightly from $12 billion to $12.3 billion, stemming declines over the last two years. But this increase was attributable to the impact of higher fuel prices. Taking fuel out of the picture, postal spending declined slightly. Overall spending on capital commitments was anemic, with less than $1 billion spent on facilities, equipment, and other infrastructure and support.

Only one automation equipment supplier, Northrop Grumman, made the top 10, with $410 million in postal revenues. Northrop Grumman provides automation design, equipment fabrication, field deployment and logistics support to the Postal Service. Notably absent from the top 10 was Siemens, who fell from $134 million in revenues and the fifth spot in 2010 to $69 million and the 20th spot in 2011.

Other companies in the top 10 include fourth-ranked Pat Salmon & Sons, Inc., and eighth-ranked Mail Contractors of America, Inc., both of whom transport mail by truck for the Postal Service. Pat Salmon recently acquired Mail Contractors, making it by far the largest USPS ground transportation provider.

Wheeler Bros., Inc., in fifth, provides vehicle bodies and trailers. Campbell-Ewald, the Postal Service's advertising agency, is sixth, though most of its revenue is pass-through spending for media purchases. Accenture, up from ninth last year to seventh this year, provides information technology consulting services. IBM, in ninth, provides methodology and analysis, systems maintenance, software, and management support. United Airlines, which carries mail by air, secured the number 10 spot.

Below is the list of the top 10 suppliers, showing rankings for Fiscal Year 2011 and FY 2010 (October 1 - September 30). The list is prepared based on data received from the U.S. Postal Service in response to Freedom of Information Act requests. Entries for known affiliated companies are then consolidated to obtain a more accurate representation.

*Denotes consolidated entries.

The firm's Postal Service Contracting group assists clients in contracting with the U.S. Postal Service, and its members are knowledgeable regarding the needs specific to the postal industry. Hendel has developed and presented several training courses on postal contracting. He also writes a monthly column on postal contracting issues for the National Star Route Mail Contractors Association. He has represented hundreds of postal contractors on a wide range of issues.