The Status of the Postal Service's ZIP-Plus-4 Program

GAO testified on the status of the Postal Service's (USPS) efforts to successfully implement its ZIP-Plus-4 Program and provided information on the extent to which businesses use the ZIP-Plus-4 to address their mail and the progress USPS has made in developing prototype conversion kits for converting the single-line optical character readers to multiline readers. Under the program, USPS has purchased optical readers and expanded the ZIP code to nine digits; however, the program's success depends largely on business usage. GAO found that businesses have been slower than anticipated in adopting ZIP-Plus-4 and, while USPS may achieve its revised estimate for 1985, it still has far to go to reach its 50-billion-piece level in 4 years. To encourage more businesses to convert to ZIP-Plus-4, USPS has: (1) dropped its ban on mixed mail and will establish a minimum percentage of ZIP-Plus-4 mail that must be combined in presorted mail; (2) established procedures to ensure that such mailings are eligible for discounts; and (3) plans to make presorting easier. USPS is waiting for the results of a committee which is studying the conversion kit concept and the possible need to purchase optical character readers manufactured as multiline readers before awarding contracts to develop prototype conversion kits. GAO believes that USPS should: (1) conduct a market study to judge the potential market for ZIP-Plus-4 to determine whether the single-line readers should be converted; (2) strive to achieve 50 billion pieces of ZIP-Plus-4 mail since such volume maximizes the return on investment from a single-line system; and (3) move ahead with the development of prototype conversion kits so it can be in a position to convert the single-line readers.