By now, unless you have been on a desert island for the past month, youve probably heard about the impending postal rate change. For the first time ever, the rate structure will consider an items shape in addition to its weight. Under the current system, a three-ounce letter, flat or parcel costs the same to mail for the consumer but not for the USPS.
It was not until July 1971 that the Post Office Department evolved into the modern USPS. The Postal Reorganization Act empowered the Postal Rate Commission to recommend postal rates and mail classifications for adoption by the newly formed Board of Governors and required that rates for each mail class cover direct and indirect costs.
Modern Machinery
Accelerated automation of the postal system began in the late 1960s, with the introduction of automated cancellers, optical character readers (OCRs) and special barcode readers. Manual processing of handwritten addresses has been largely automated. The USPS is also automating the processing of flats and parcels.
The proposed postal pricing plan offers price incentives for efficient, automation-friendly mailings while reserving the biggest increases for items that require hand processing, especially when other packaging options are available.
The Push for Efficiency
The new rate structure carries stiffer increases for lightweight flats and parcels. Customers who mail flats weighing less than 3.5 ounces and parcels below thirteen ounces will see the highest price hikes. As the item gets lighter, the rate increase percentage rises dramatically.
Under the new system, postage costs will decrease for certain types of mail. Letters weighing more than one ounce and flats that weigh between seven and thirteen ounces will cost less.
The proposed pricing structure encourages use of flat and letter mailings whenever possible to take advantage of automated processing. Changing a flat to a letter and a parcel to a flat yields larger savings to the customer.
The Biggest Impact
Many businesses need to plan now to absorb double-digit postage increases. Commonly mailed, lightweight items will incur steep postage increases if they continue to ship in small boxes and padded envelopes. Similarly, companies that use 9 x 12 envelopes to mail statements, newsletters, brochures and catalogs will also see a severe price jump. As a result, many mail-order retailers, financial institutions and fulfillment houses are rethinking their packaging options.
Reconfiguring the mailing system to work within the new rate structure holds the potential for significant cost savings.
