The U.S. Postal Service, despite posting better financial figures, may scale back certain operations—particularly Marketing Mail—posing potential challenges for retailers and B2B vendors.
Postmaster General David Steiner said during the agency’s November 10, 2026, Board of Governors meeting, “Our results for the year show a positive trajectory in virtually all of the areas where we have the ability to exercise control over our business.”
However, Steiner noted that many aspects of their business are uncontrollable because they are dictated by Congressional and regulatory requirements.
Steiner warned that the agency may need to make drastic changes in the number of post offices and Marketing Mail service levels due to the restrictions placed on it.
Financial Results
The USPS released its fiscal 2026 results, which showed a $6.5 billion net loss in the year ended September 30, down from a $9 billion loss in fiscal 2025.
Operating revenue increased 3% to $82.9 billion. The USPS also deferred approximately $2.6 billion in retirement contributions during fiscal 2026.
Service Reductions
Steiner has described two possible paths forward: Congress removes or funds certain obligations, or the USPS reduces services.
The USPS release called out Marketing Mail, a bulk service used for advertising, promotional postcards, catalogs, and similar mailings, as an area that may be affected.
The Postal Service handled some 56.1 billion pieces of Marketing Mail in fiscal 2026, down a mere 1.1% year over year.
Revenue for the service class rose 5.3% to $16.7 billion, thanks primarily to price increases in October 2025 and July 2026.
Impact on Merchants
If the USPS extends delivery windows for Marketing Mail, merchants might need to send catalogs and promotional materials earlier.
This could increase the time between developing a marketing campaign and its arrival in a shopper’s mailbox.
However, longer delivery standards do not necessarily mean lesser reliability, as a mailing that consistently arrives within seven days could be easier to coordinate with an online promotion.
The significance of Steiner’s warning about Marketing Mail depends on the details, and the impact on merchants will vary depending on their use of the service.
Some merchants, such as online wholesalers and distributors, use printed catalogs to introduce products and generate sales, and changes to the USPS’s Marketing Mail service could affect their business.
A 2025 study by Distribution Strategy Group found that 12% of responding distributors and manufacturers ranked printed catalogs as their most effective channel for generating ecommerce demand.
In addition to Marketing Mail warnings, Steiner said the agency could reduce the number of post offices it operates, which could increase shipping costs for ecommerce merchants in rural communities.
A January 2026 study from the Brookings Institution found that rural counties with relatively better access to post offices had higher levels of small-business activity.
For example, a small ecommerce merchant may drop off packages at a nearby post office four times per week, and if a closure adds 45 minutes to each trip, the merchant would spend three additional hours weekly delivering packages.
Lower Delivery Standards and 2027 Service Proposals
Marketing Mail uses slower delivery standards than First Class, and businesses accept longer windows for lower postage costs. Steiner said the USPS will propose service reductions in early 2027 and will brief government leaders.
Direct mail remains popular; Amazon offers a children’s gift catalog. Retailers align catalog arrival with inventory, email and discounts, leading merchants to adjust 2027 planning cycles.
