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The Postal Service’s top contractor? Federal Express

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The U.S. Postal Service doesn’t just deliver the mail; it also buys a ton of goods and services, as a new compilation of the mail carrier’s top 150 contractors reminds us.

Leading the list for the ninth straight year is Federal Express Corp., which received almost $1.5 billion from the Postal Service in fiscal 2011 to transport Express, Priority and First-Class Mail; runner-up Kalitta Air LLC was paid about $549 million to send military mail to troops deployed in Iraq and Afghanistan,  according to Husch Blackwell, the Washington, D.C. law firm that puts the list together each year.

For those that think of Northrop Grumman as a defense contractor, it claimed the number three spot by providing  $411 million worth of automation design and other products and services. Another big recipient of USPS work was consultant Accenture, which placed seventh at $125 million.

Given that Federal Express competes with the Postal Service for package and overnight mail business, it might seem surprising that it is also the single biggest USPS contractor. But David Hendel, a partner at Husch Blackwell, noted that both FedEx and United Parcel Service use the Postal Service for delivery on the “last mile.”

Nowadays, Hendel said, “they are more business partners than anything else.”

Comments

  1. Bruce D Ranger Says:
    February 4th, 2012 at 4:17 am

    The correct current name of the company is FedEx Express.

    In January 2000, the name was changed from Federal Express.

    For FedEx corporate history see

    http://about.fedex.designcdt.com/our_company/company_information/fedex_history

  2. Sean Reilly Says:
    February 4th, 2012 at 7:40 am

    Mr. Ranger: Thanks very much for your comment. I checked and the company’s legal name-according to its latest Securities and Exchange Commission filings–is still Federal Express Corporation. (http://www.sec.gov/Archives/edgar/data/230211/000095012311103279/c25954e10vq.htm).
    Since the parent corporation oversees a number of different operating companies and because the Husch Blackwell list refers to “Federal Express Corporation,” I’m going to stick with that for first reference.

    Sean Reilly

  3. MIke D Says:
    February 4th, 2012 at 10:24 am

    There’s nothing wrong with the USPS accepting business from it’s competitors, in fact it’s healthy that they do, and have done for many years. It’s no secret that USPS Priority mail outshines anything that UPS or Fed Ex can offer, cost wise at least. But that simple fact isn’t widely known or you’d see both those companies try more to compete for the bottom line. Why do they use the USPS for the ‘last mile delivery’? Because as singer Carly Simon said in verse, “Nobody does it better”…………

  4. Chris Says:
    May 1st, 2012 at 2:40 am

    FedEx Express is a company that exploits third world countries. They allow no democracy, and they hire the most evil managers, to do their bidding. Mr. Smith, is the most dangerous, because he allows any exploitation of workers, yet he offers business advice to so many, and show off how savy he is. Yet his social responsibility is based on the country he is in, hence most third countries are under paid and exploited in the worse ways. It is the best place to work only for some, and the stooges of Managers, are nothing to reckon with.