In October 2012, for instance, the Postal Service only had a few days worth of cash on hand to fund operations, compared to most companies, which have two months’ worth available, Donohoe said.
“At one point last October, the postal service had less than four days of cash on hand to fund operations. For an organization the size of the Postal Service, which has revenues of $65 billion and a workforce of 495,000 career employees, this is a razor-thin margin. By way of comparison, most private sector companies usually have about two months of cash on hand,” he said.
Donohoe said the lack of flexibility in the U.S. Postal Service’s business model has prevented it from closing the budget gap.
“The Postal Service must generate roughly $20 billion in cost reduction and revenue generation by the year 2016 to return to financial stability,” he said.
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