I can be described as a mail geek because I get excited about dissecting postal rate changes to see how it is going to affect my customers. This time was no exception. There is nothing better than sipping a glass of eggnog, listening to holiday music and looking at spreadsheets on postal classes. The good news for everyone is this is about as mild a postal storm as we could hope to expect. In fact there are even some ways that customers can reduce costs!
In this article, I will attempt to make this rate change simple, highlight the differences and let you know how this is going to impact your bottom line. There are so many rate classes, weights and zones that it is impossible to show everything. The goal is to focus on the most common to give you the information you need in a simple format that you can use.
First-Class Mail® Retail (Single Piece)
The good news is that the core offering of letters and flats had a very low increase. Retail (Single piece) Letter and Flat rates only went up $.01-.02 (1-2%) per piece. Post Cards on the other hand, went up $.03 at a 10% increase. Also, Parcels increased up to 14%! My guess is that the USPS realizes that it is the least expensive game in town with light weight packages, which is a growth area with on-line commerce.
First-Class Mail® Commercial (Discounted prepared in batches)
When we look at commercial, there are several interesting changes worth noting:
- Overall rate increases is 1-10%.
- The USPS took away any differences from AADC to 3 Digit Letter rate. This will relax the need to push for 3-digit for mailers and presort providers.
- The biggest change is the making the second ounce letter rate the same as the first ounce actually reducing costs by 21-25%! This will be a win for mailers who:
- Are already sending a lot of 2 ounce letter mail
- Can find extra marketing material to add to existing one ounce mail to grow their entity.
- Entities that can broker this space inside their envelope.
With Standard Mail® the increase was small and consistent at 1-2%. The good news story comes to Nonprofit Mailers who saw almost no increase to in some cases slight decreases! Someone is doing a good job lobbying the Postal Rate Commission.
Rate increases are never a good thing, but you have to put the USPS 2.5-4.4% increase in perspective because it is less than the 5.9% announced by UPS and FedEx. Regardless of your discount tier with the private carriers, I recommend you compare rates and delivery times against USPS on less than 10 LB packages, especially ones going to residences or rural zip codes.
The most notable change is that the Electronic Delivery Confirmation fee for First Class™ Parcels went from $.19 to free! This is a huge win for entities sending light weight packages. There are many options to submit these electronic confirmations including internet postage, postage meters, and manifest systems.
The USPS is trying to do everything it can to keep rates hikes as low as possible. We can see that overall this rate change was low and there are some strategies that can reduce costs. I hope this information was helpful. I realize that not every class and service is provided but this is the bulk of all domestic USPS classes and services in hopefully an easy to comprehend manor.
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