® Flats Symposium 2008 National Postal Forum ® National Postal Forum 2008

National Postal Forum ® Anita Pursley Vice President, Postal Affairs Quebecor World Logistics Jeff Williamson Manager, Network Development and Support USPS Tony Dobush Partner PLS-Midwest Panel Members

National Postal Forum ®  Integration of FSS into Network  Drop Shipment Changes  Network Strategy  Industry Challenges / Opportunities Agenda

National Postal Forum ®  Deploy to Multiple Types of Facilities Co-located with Bundle Distribution Co-located with P&DC Operations Stand Alone FSS Deployment Integration of FSS into USPS Network

National Postal Forum ®  Transportation Flow To FSS End-to-End Product Through Existing Network Transportation Drop Ship  Down Flow From Upstream Entry (BMC, ADC, SCF)  Directly to FSS Site  Transportation From FSS to DDU – Based on Density to Optimize Trip Utilization Direct to DDU Transfer Through P&DC Integration of FSS into USPS Network

National Postal Forum ®  Objective is to Minimize the Number Of Entry Points  Preparation Changes to Align With FSS Schemes  Service Standards  CET Drop Shipment Impacts

National Postal Forum ®  Objective: Create a Network That Produces the Lowest Combined Cost for USPS & Customers, and Improves Consistency of Service USPS Network Strategy

National Postal Forum ®  Focus on: Air Transportation  Reliable Low Cost Air Network  Reduce Air Mail Center (AMC) Operating Cost Processing & Distribution Center (P&DC)  Plant Consolidations  Eliminate Excess Processing Capacity Bulk Mail Centers (BMC)  Optimize Utilization of Key Assets USPS Network Strategy

National Postal Forum ®  FSS in Multiple Facility Types Increase in Number of Entry Points Multiple Requirements for Drop Ship Entries CET Management for In-Home Planning  New Pallet Preparation Requirements Additional, Smaller Pallets Increased Number of Sacks Less Finer Level Sorted Pallets Additional Handling Costs Industry Challenges / Opportunities

National Postal Forum ®  Co-Mail and Co-Palletization Value of Co-Mail Increases? Added Complexity Additional Space / Staging Requirements  Transportation Increased Costs – Fuel, Stop-off Charges Load Factor Load Stability Industry Challenges / Opportunities

National Postal Forum ® Despite Challenges, the Industry Supports the FSS Initiative and the USPS Objective of Creating a Network that Produces the Lowest Combined Cost for USPS & Customers and Improves Consistency of Service Summary

National Postal Forum ® Customer Perspective and Challenges