Many of the 4,500 small, independent U.S. postage stamp vendors -- those who install and service vending machines in supermarkets and covenience stores -- think the U.S. Postal Service may bankrupt their industry.
Beginning last fall, the postal department started to order and install new stamp-vending machines as a way to "improve postal services to the public," claims Gordon C. Morison, assistant postmaster general for customer services. Four thousand machines, ordered over the last two years, were intended to replace models that have been in use since the 1960s, Morison says, and to supplement regular post office services in high-growth areas like Houston, Tex.
Louis Axerlod, owner of the Houston-based United States Postage Stamp Co., however, doesn't see it that way. "In Houston," he says, "we feel the federal government is encroaching on private business."
Axelrod, whose vending business does about $1 million in sales each year, has lost 30 locations to the federal machines, particularly in two major chains in the area -- Safeway food stores and Eckerd drug stores. Those lost locations alone, he claims, will cost him about $100,000 a year in stamp sales.
Even when postal machines are installed alongside private vendors', the small businessman will lose out, says O.D. Strozier, president of the National Association of Postage Stamp Vendors, which has headquarters in Tulsa, Okla. Private vendors charge a "service fee" for stamps, whereas the post office machines can sell stamps at face value, Strozier points out."Obviously, consumers are going to buy the stamps at face value first," he says.
A further threat, says Donald Conn, president and owner of E.B. Conn Vending Inc., of Niles, Ill., is that the postal department is "taking the cream of the corp. They're skimming off the big cities and big chains, leaving us with inner-city and mom-and-pop locations. They tell us there's room for both of us in the marketplace." Conn forecasts a different scenario. The postal service's actions will ultimately force his industry "to go down the drain," he claims.
The postal service's Morison says his department won't install machines "in those stores already serviced by private vendors. We have no desire to put these vendors out of business."