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Originally published September 25, 2014 at 1:33 PM | Page modified September 26, 2014 at 9:20 AM

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Postal Service aims for grocery delivery beyond Amazon

The U.S. Postal Service, which has been testing grocery deliveries for Amazon in San Francisco, is now seeking permission to move to new markets and handle shipments for other companies.


Seattle Times business reporter

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The U.S. Postal Service wants to expand its grocery deliveries for Amazon.com and potentially its rivals.

For the past several weeks, the agency has been testing delivering prepackaged grocery items purchased from the Web giant to customers in San Francisco. According to a filing, the Postal Service is now seeking approval from the Postal Regulatory Commission to add new cities to the test.

The public version of the filing, first reported by The Wall Street Journal, has been redacted and never mentions AmazonFresh, the company’s grocery-delivery service, or San Francisco. But a Postal Service spokeswoman noted that partnership and said the agency is looking to move beyond both the company and the city.

“We’ve been conducting an operational test with Amazon in San Francisco, but the filing is requesting the ability to conduct a two-year market test to expand locations and partners,” Postal Service spokeswoman Sue Brennan said in an email exchange.

An Amazon spokeswoman said only that the company is “always looking for new and innovative ways to deliver packages to customers.”

In the four markets in which AmazonFresh operates — Seattle, San Francisco, Los Angeles and San Diego — the company uses its own trucks to deliver canned food, perishable items and even nongrocery items, such as books or DVDs. San Francisco is the only market where AmazonFresh also uses the Postal Service.

According to the filing, the Post Office is delivering both perishable and nonperishable items. The agency said that “the retailer brings groceries already packed into retailer-branded totes, some of which are chilled or include freezer packs” to postal-delivery operations between 1:30 a.m. and 2:30 a.m.

Postal carriers deliver the goods between 3 a.m. and 7 a.m., dropping them off at a spot designated by the customer, without ringing doorbells or knocking on doors. The filing noted that carriers were delivering an average of one to four totes per address with an average of 160 totes per day to the 38 ZIP codes included in the test.

The agency now wants to expand to other cities, and to other times during the day. It wants to begin the expansion Oct. 24, and run that market test for two years.The Postal Service needs approval from the Postal Regulatory Commission to conduct such market tests.

The Post Office has struggled financially for years. It’s previously turned to Amazon, one of the nation’s largest shippers, for new sources of revenue, such as Sunday deliveries. In the filing, the agency said revenue could top $10 million.

“The exact revenue and volume is difficult to predict, as the success of this market test depends on the number of participating retailers, the scope of their businesses, and ultimately, the demand for grocery delivery among consumers in the marketplace,” the agency wrote in the filing.

Jay Greene: 206-464-2231 or jgreene@seattletimes.com. Twitter @greene



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