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GGD-75-62 1 (1975-02-13)

handle is hein.gao/gaobaaauf0001 and id is 1 raw text is:                               '//


                     COMPTROLLER GENERAL OF THE UNITED STATES   -
                              WASHINGTON. D.C. 2DUS4


     B-114874



     The Honorable William L. Hungate
     Chairman, Subcommittee on Environmental
K     Problems Affecting Small Business
    House of Representatives

    Dear Mr. Chairman:

         Your October 16, 1974, Committee report requested that we inves-
    tigate (1) the profitability of the Postal Service's postique operations,
    (2) the profitability of the Postal Service's sales of printed return address
    envelopes, and (3) the Postal Service's centralized automotive parts dis-
    tribution system.

         In accordance with agreements reached with your office at our De-
     cember 5, 1974, briefing, our October 10, 1974, report entitled
     Observations on Sales of Postal Related Products and Photocopy Serv-
     ices (B-114874) adequately addresses the first area of the Committee
     request and no further work is necessary. The second area of the request,
     covered in this report, was modified by your office in that we are to
     provide facts about the program without reaching conclusions or making
     recommendations. The third will be reported on separately.

     BACKGROUND

         The Post Office started selling stamped envelopes in 1853, and in
    1865 it began offering the printing of return addresses on the stamped
    envelopes.

         At present, one contractor supplies plain and printed (return address)
     stamped envelopes for the Postal Service. The total number of envelopes
     sold by the Service--about 1. 3 billion--constitutes about 2. 5 percent of the
     total first-class mail processed, while printed envelope sales--about 400
     million- -represent about 0. 78 percent of this mail.

         The Service does not actively promote the sale of printed stamped
     envelopes. On the other hand, it has no plans to discontinue this service.
     The number of envelopes sold by the Service in 1974 was about 660 million
     less than in 1964. Enclosure I shows the quantity of envelopes sold during
     fiscal years 1964-74.

     PROFITABILITY OF SALES

         Service officials believe that they are making a profit on the sale
    of printed stamped return address envelopes. The Service gave us
    the following information regarding these envelopes.


                                    10 fr s ? IGGD-75-62

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