The U.S. Postal Service gotplenty of headlines with its recent announcement that it plans toeliminate Saturday delivery. But for businesses that collectpayments via snail mail, the big impact has come from the changesthe Postal Service announced early last year, changes that haveslowed delivery times.

In January of 2012, the Postal Service said it would eliminate anumber of its processing facilities. It also revised its standardsfor two-day delivery from mail that originates from within roughlya 12-hour transportation range of a processing center to mail fromwithin a six-hour range.

“Those standard changes are the biggest impact corporate Americais going to see,” said Lex Litton, a senior vice president atPhoenix-Hecht,a financial services research firm in Research Triangle Park,N.C.

The elimination of Saturday delivery, which is to go into effectin August, shouldn't have a big effect on business paymentsprocessing because the Postal Service will continue to deliver mailto post office boxes on Saturday, Litton said. “Lockbox users andcorporations that process their own payments would continue to haveaccess to Saturday delivery unless they have payments delivered toa physical address, and I think that's quite a rarity forcorporations of any size,” he said.

The Post Office will also stop picking up mail from mail boxeson Saturdays. Again, Litton said he sees little impact onbusinesses, noting that most companies do not send out payments onSaturdays “unless they're really on the small side.” Consumers maybe surprised by how the changes affect payments they mail onSaturdays, though, he said. Currently if a consumer mails a paymentSaturday, there's a good chance that it will arrive Monday, but thechanges will likely push delivery back until Wednesday. That willalso affect the timing of payments flowing into lockboxes thatprocess retail payments, which he predicts will see volume shiftfrom Monday to Wednesday.

Meanwhile, though, the most recent Phoenix-Hecht survey ofremittance processing shows the Postal Service's previous changeshave had a big impact. Last July, the Postal Service implementedthe changes in two-day delivery standards and shut down 46 of itsprocessing facilities.

Sixty-eight percent of the respondents to Phoenix-Hecht'sOctober survey said their delivery times had increased since theprevious survey in June, with the increase averaging five hours, or0.20 mail days. That boosted the average delivery time for allrespondents by almost three hours. That is the biggest change inPhoenix-Hecht's survey results since 1999, Litton said.

The survey shows considerable disparitiesbetween regions. “There were locations where we couldn't tell theJune survey from October,” Litton said. “Atlanta, Chicago,Philadelphia, Boston—those locations seemed to be sort ofimmune from the changes.” But West Coast locations like Los Angelesand San Francisco showed big increases in delivery times, as didCharlotte, N.C., he said, adding that the Postal Service will belooking for ways to mitigate the effects of its changes.

Given the slowdown in delivery, some companies may add lockboxlocations, according to Litton. “You may have had companies thathave, let's say, two lockbox locations and are really close tobeing able to justify a third. Now the not quite becomesjustified.”

Since the standard for two-day delivery went from a 12-hourrange to a six-hour range, “if you introduce an additional lockboxinto your network, you have an additional six-hour radius oftwo-day delivery,” he said. “As long as you're getting enoughpayments from that region, that has a real value to your collectionnetwork.”

With interest rates so low, companies may be less concerned thattaking longer to get payments into their bank account will losethem float, Litton said. However, “companies are also verysensitive to information float. The longer it takes them to processpayments, the longer before they know which bills have been paid,”he said.

Patricia McGinnis, director of the commercial and enterprisepayments group at Mercator AdvisoryGroup, a payments research firm in Maynard, Mass., argues thatcompanies remain focused on managing their working capital asefficiently as possible given that banks are still stingy aboutproviding credit. “Getting payments collected and cashed in doesmatter to most corporations,” she said.

Might slower delivery times be enough to push more companies toswitching to electronic payments? McGinnis said quite possibly, andnotes that companies are using fewer and fewer checks, with surveysshowing paper payments to companies' major suppliers have fallenbelow 50%. “What you do see over the last six to eight years is asteady decline in the use of checks and increasing use ofelectronic payments methods,” she said.

For more on the Postal Service's recent changes, seePostal Service Tries to Avoid Twinkies' Fate andPostal Service to Shut Plants. For a look at the use ofadvanced technology in lockboxes, see AdvancedMatchmaking.