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Photos via Shutterstock and Amazon.com
Photos via Shutterstock and Amazon.com

The federal Postal Regulatory Commission today approved a request by the U.S. Postal Service to conduct a two-year test of early morning grocery delivery by Postal Service employees and vehicles in San Francisco, expanding beyond an initial pilot with Amazon Fresh.

The approval came despite objections from the Taxpayers Protection Alliance, which contended that the expansion has the potential to harm private grocery delivery services.

In its order approving the test, the commission said it “has evaluated the Postal Service’s pricing plans filed under seal as well as a sampling of similar grocery delivery service providers.”

It continued, “The Commission finds that the prices offered by grocery delivery service providers operating in San Francisco are comparable to the price range the Postal Service intends to test. Therefore, Customized Delivery is unlikely to provide the Postal Service or the retail partner an unfair or inappropriate competitive advantage.”

The commission, however, ruled that the Postal Service can’t exceed $10 million in annual revenue through the test, requiring the USPS to request an exemption later if it reaches that point.

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