Eli5 How does a stamp cover the cost of sending a letter?

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It confuses me on how one stamp can cover the cost of sending something basically anywhere in the states, and international isn’t much more.

Wouldn’t the gas alone cost more?

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Anonymous 0 Comments

Yes it would cost more in gas if they just individually ran letters one by one from here to there. The postal system is an example of an economy of scale and doing things smarter not harder.

For example let’s say it takes $100 in diesel to get an empty semi from City A to City B. That’s just an empty truck with nothing but a driver. Now let’s start adding mail into it. A letter is pretty light and there’s rules where if it weighs so much you have to add more postage. Each piece of mail adds $0.0001 cents to the diesel bill, so every 100 letters costs another penny. 100 letters is going to be $58.00 in postage starting next Monday, so with *just* 100 letters we’re already over halfway covering the diesel.

But it’s a semi it has room for a whole lot more than 100 letters, let’s load 20,000 letters on it (still way under what it can haul, as each letter is pretty small and has a weight limit of 1 oz). Now you’re hauling $11k worth of postage for $102 worth of diesel. Plenty of room in there now for paying the driver and postal workers and maintaining the machines.

Of course that’s just the semis running from the hubs, not the little Grumman truck putting it in your mailbox. But even those are handling hundreds or thousands of letters in a day between delivering and picking up. And again they aren’t doing it one by one, they follow a route and do all delivery and pickups while following that route so doing all those transactions for the cost of one trip through the route.

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