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Managing A Growing Mail Center Mailcom Ac 2008
 

Managing A Growing Mail Center Mailcom Ac 2008

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Managing A Growing Mail Center Mailcom Ac 2008 Managing A Growing Mail Center Mailcom Ac 2008 Presentation Transcript

  •  
  • What we are going to cover
    • Resources
    • Shape Based Pricing – 6 ways to save $
    • USPS compliance
    • Marketing Tips
    • Latest Technology
    • Performance Benchmarks
    • Product cycle speeds vs. Reality
    • How to calculate Payback periods and ROI
    • Mail Center - Work-flow design
  • Resources
    • Local MSMA Events
    • Mailcom – Atlantic City –
    • National Postal Forum – Anaheim, May 18-21
    • Mail – The Journal of Communication Distribution - $45/Yr
    • 133 Main St., Delhi, NY 13753-1288
    • or email Mailmagazine@msn.com
  • Resources – continued
    • Mailing Systems Technology – Free
    • P.O. Box 259098, Madison WI 53791-7479
    • MailPro New Publication combines “Memo to Mailers” and “Mailers Companion”
    • NATIONAL CUSTOMER SUPPORT CENTER US POSTAL SERVICE 6060 PRIMACY PKWY STE 101 MEMPHIS TN 38188-0001 Fax: 901-681-4521 E-mail: [email_address]
  • Trade Magazines
    • Information Overload, lot of repetition.
    • Scan for items affecting your Operation
    • Read Title, 1 st paragraph and then
    • Skip to end to see who wrote the article - Consider the source as you read the rest from the beginning.
    • Realize the Author will spin the subject so that their product will look attractive.
  • May 14 th 2007 Not A Normal Rate Change
    • Previously based on:
      • Weight
    • Now based on:
      • Size
      • Weight
      • Thickness
    The USPS not only changed the rates, but the classification structure as well!
  • SBP Pricing Example 2-ounce letter 63 ¢ 2-ounce flat 63 ¢ 2-ounce parcel 63 ¢ ► 58¢ ► 97¢ ► $1.30 -7.9% +54.0% +106.3% Postage is no longer based solely on weight!
  • Mail Processing Flowchart (First Class Example) Previous Rating Method
  • Mailing Operation Expenses Equipment Labor Postage Waste Prior to May 14, Cost USPS SBP Change Comprehensive Solution Equipment Labor Postage Waste Equipment Labor Postage Waste
  • So What Should You Do?
    • Don’t Panic!
    • There are 6 steps you can take to minimize the impact.
    • Schedule an onsite impact analysis so that you are prepared.
  • 6 Solutions
    • 1. Class / Service - Choose Wisely
    • 2. Shape – Repackage as appropriate
    • 3. Automate – save on Labor
    • 4. Address Quality = Better Results, Less $
    • 5. Group – reduce mailings, not content
    • 6. Account – Empower and Hold accountable
  • 1. Class of Mail / Service
    • Does that Marketing Mailing really have to go at First Class?
    • Presorted First Class or Standard Mail done right can be just as effective
    • Learn the tricks to make Std Mail look like First Class
    • Best Way – Select the best Carrier and service level to fit the need.
  • Shop the “Best Way”
    • Simply select the day you want the mail or pkg. to arrive
    Calendar View G2’s “Best Way” “ Viewer” shows estimated time of delivery and total charges
  • Automation Rates Save $ 2-ounce letter 58 ¢ 1oz. letter 41 ¢ 1-ounce auto letter 33.4¢ 2-ounce auto letter 45.9 ¢ Auto 21% Savings 19% Savings Base on 3-digit sort Auto First Class vs. Presorted First Class
  • Automation Rates Save $ 2-ounce letter 58 ¢ 1oz. letter 41 ¢ 1-ounce auto letter 23.3¢ 2-ounce auto letter 23.3 ¢ 60% Savings 43% Savings Base on 3-digit sort First Class vs. Standard Auto 3 Digit Auto 3 Digit
  • 2. Pay Attention To Shape
    • Review designs of all current and planned mailings to ensure that they are cost effective using SBP requirements. For example:
      • A 1 oz. 6” by 6” envelope’s aspect ratio (length divided by height, must be between 1:3 and 2:5) is 1.0, and is subject to the non-machinable surcharge of $0.17 (41 cents vs. 58 cents, a 41% increase).
  • Minimize Costly Flats 6 x 9.5” + = $0.80 1-2 Pages Folded in ½ + = $0.41 9” x 12” Flat 1 to 2 Pages 49% Savings! Thin Flat Reconfiguration Example:
  • Think Thin 6” x 9.5” + = $0.97 - Flat Rate 7 Pages ½ Folded + = $0.58 - Letter Rate 6 Pages 40% Savings! Thin Flat Reconfiguration Example: #10 Envelope 6 Pages 6 Pages 6 Pages 6 Pages 6 Pages 7 Pages Of 20lb. – Over ¼”
  • Manual Shape Classification Equals the ability to rate your mail – It’s an option…But certainly not the best one! SBP Mail Rate Classification Guide Electronic Scale or Weighing Platform Lots Of Time And Patience + +
  • Semi-Auto Shape Determination
    • Automate With Dynamic Weighing
        • Increases Accuracy – eliminates guessing
        • Uses a 4 Point Detection System to automatically measure the length, width, thickness, and weight to accurately rate mail!
        • Saves time, and increases productivity!
    3. Automate – Shape/Rate Classification
    • Is your Mail Machine SBP compliant?
  • Fold & Save
    • Folder Inserter Savings
      • 40% Postal Savings,
      • Plus Labor Savings
    6” x 9.5” + = $0.97 6 Pages Folded in ½ + = $0.58 Save $390 Per. Thousand! 6 Pages 6 Pages 6 Pages 6 Pages 6 Pages 6 Pages 6 Pages Of 20lb. 9” x 12” Flat
  • 4. Address Quality – Important?
    • Costs the USPS 2 Billion /Yr to Return/Dispose
    • 17% of Consumers and Businesses move every year
    • 24% of all mail have some kind of address problem
    • 2.72% of mail is never delivered
    • 17% of all mail is delayed
    • 1.5 million new addresses every year.
        • Stats courtesy of Datatech Smartsoft 2006 and confirmed by USPS
  • My Mail is OK – you hope…
    • Postmaster General has stated by 2010 UAA Mail will have to be reduced by 50%
        • 10 Billion Pieces effected each year.
        • 1.6 Billion Returned
        • 1.985 billion Forwarded
        • 6.0 Billion Discarded
  • Ensure Address Accuracy / Incorporate Move Update Solutions
    • CASS – DPV – LACSlink – Corrects the Physical portion of the Address
    • NCOA or NCOA-Link can correct the Personal element of the address
    • AEC and AECII – product of the USPS to fix the worst of the worst
    • Ancillary Endorsements or ACS to keep it current.
  • CASS now required to incorporate DPV and LACSlink ™
    • What's the difference?
    • CASS – standardizes addresses to a range. It can assign zip+4 to an incorrect Primary #.
    • DPV – think of it as CASS on Steroids. It can verify, standardize and correct down to the actual Delivery Point.
    • Process will include conversion of Rural Route and box #s to city-style addresses using LACS Link ™.
    • This will improve the deliverability, reduce waste while improving the efficiency of Direct Mail
  • Address Quality – Things to ask your Vendor
    • Required now for Presorted First Class, on November 23, 2008 it will be required for Automation Standard. It will need to be done every 95 days.
    • Fixing data before it enters your Database
    • NCOA Link – 18 vs. 48 month
    • Off-line vs. In-Line
    • Is it “Virtually Painless ”
  • Address Correction – Ancillary Endorsements vs. ACS MAY 14, 2007 TODAY ADDRESS CORRECTION SERVICE FREE $0.05 $0.02 $0.15 N/A N/A Automated w/ Intelligent Mail ® Barcode First-Class Mail ® letters - first two notices Additional notices Standard Mail ® letters - first two notices Additional notices $0.06 $0.25 $0.21 Electronic – via ACS First-Class Mail ® Other classes $0.50 $0.75 Manual – Ancillary Endorsement
  • ADDRESS CORRECTION SERVICES
    • Intelligent Mail Barcode™!    – The Postal Service Finally Chooses A Name!
    • OneCode Confirm: Combines Planet Code and DPBC into one Intelligent Barcode!
    • OneCode ACS: Combines ACS and DPBC into one Intelligent Barcode.
    • With new rate structure,
    • ACS is less expensive!
    • Less junk on the mailpiece
    • Not required until 2009
  • 5. Group - Become More Efficient
    • Increase mailing efficiency by:
      • Grouping documents into one envelope to dramatically cut postage costs. One flat at $0.97 is still less than two or three mail pieces sent at $0.58 each. Better yet, fold in half and use 6” x 9.5” Envelope to keep it under ¼” thick – Letter Rate.
      • Switch from single sided printing to double sided printing. This allows you mail fewer pages which will cost you less.
      • Maximize each ounce. Add a marketing piece or two, If you have room to spare in an envelope; considering its weight and thickness. Under the new SBP rates, it could actually cost you less (i.e. a 2 oz. letter is $0.63, as of May 14th it will be $0.58)
  • Opportunity to Group
    • Have a customer who sends multiple pieces to the same location every day?
    Acme Widgets
  • Manually Group
    • Accumulate mail to: Major Customers, Representatives, Branches, Outlets, Franchisees etc. and send on Periodic Basis
    Acme Widgets
  • Grouping Automatically Via IDM Software
    • Allow the customer the ability to create intelligent custom documents w/o changing platforms.
    • Merge Multiple Print Streams, CASS and Presort documents.
    • Add OMR (Accumulation) Marks for Automatic Folder/Inserter
    • Divert selected documents to distribute via fax, e-mail or E-File.
    • Index and archive all methods of distribution
    • Postal accounting options include:
      • Standard mailing system accounting (simple piece and postage tracking for a relatively small number of departments).
      • Online reporting capability which provides the ability to view postage spent by department, mail classes and timeframe.
      • Advanced accounting systems with unlimited departments, advanced budgeting, account consolidation and more.
    6. Track & Control Costs
  • USPS compliance - It’s My Responsibility to know it.
    • Postage Meter – Digital Mandate
    • Address Quality – NCOA, CASS, DPV
    • Mail piece Design – DMM200 – An Introduction to Mailing for Businesses and Organizations
    • Ancillary Endorsements – Choose Wisely
    • Pub 95 – Quick Service Guide – Jan ’06
    • MQC Training / Certification
  • Marketing Tips
    • Incoming Mail – Study and learn from others – The Good, the Bad and the Ugly
    • Put yourself in the Recipients shoes – would you be inclined to open and/or read it?
    • Postage Options – Stamp vs. Meter vs Preprinted Indicia.
  • Permit Imprint Option
  • Pre-Cancelled Stamps - Options
  • Metered Mail Option
  • How to make Std mail look like 1 st class
    • Don’t print Endorsement line on every piece.
    • Avoid Carrier Route for Small to Med size mailings.
    • If Using stamps, use your own Cancellation over them – see Example
    • Separate Barcode from Address block
    • For Personalized Message – Use Script Font in Blue ink.
    • Other Examples – Its all about the motivation to open
  •  
  • Best Practices Notice the Pkg and Seq. Marks Notice the very small Vertical classification dye Price paid -1/2 of FC Notice the verbiage
  • Latest Technology Why is this important?
    • Budget reduction – doing more with less
    • Obsolescence – Time marches on
    • New Responsibilities
      • – New Projects, Consolidated Mail
    • Change is a good thing
  • OK, So What's New Today? Digital Mailing Machines – Do I have to change?
    • Shape and Weight Detection –”in motion”
    • PSD
    • Print Quality, Step Mail
    • Speed Increases, in motion vs. batch
    • Ad & Mailing Dies,
    • Text Messages,
    • Macros – Jobs and Departments
  • Folding and Inserting – Easy or Frustrating?
    • Job Memory
    • Accumulate before Folding
    • Knife Blade vs. Buckle chute
    • Bottom Flap Envelopes vs. 3 fold chambers
    • Envelope construction – Side Seam vs. Diagonal
  • Addressing Systems – Which model is right for me?
    • Faster, Higher Quality output
    • Less Expensive
    • HP thermal inkjet - Can now Print on Aqueous Coated Materials
    • Color Options
    • Fixed vs. Shuttle
    • It all depends on how much you want to do and on what material.
  • Performance Benchmarks - Importance:
    • Data is used for creating Work Standards
    • Data is used for Budgets and Forecasts
    • Justifying Wage and Benefit Increases
    • Justifying New Technology
  • Performance Benchmarks - How?
    • At a Minimum you should record and document:
    • Incoming Mail – Daily pieces or Number of Tubs
    • Outgoing Mail - Daily pieces or Trays & $ Spent.
    • Better :
    • Incoming Mail – Document by Pick up
    • Early Morning P.O. Pick up - pieces/ Number of Tubs Late Morning P.O. Pick up - pieces/ Number of Tubs
    • Carrier and Courier Deliveries: Fed Ex, UPS, Express Mail etc
    • Use Inbound Tracking and Receiving System to Document Detail
    • Outgoing – Capture by Department and Class – report capability by date range with detail for all Carriers.
    • Use a Multi-Carrier Manifesting System
      • Additional features: Internet Tracking Capability, integrated Delivery Confirmation for Priority Mail, Email Notification, 3877 Firm Mailer Book, Carrier Performance reporting, Shape Advisor, Best Way Rate Shopping
    • Rates shipping performance
    • Includes fuel charge
    • User configurable
      • Can weight air vs ground
    Report Card - GPA
  • G2 Report card SWC
    • Shoulda, Woulda, Coulda
    • Show total cost savings potential
    • Provide a quick way to find potential savings
    Shows Costs & opportunities to save!
  • G2 Report Card Ground Hog
    • Analyses packages that were sent air that would have arrived the same time using ground
    • Show savings of using ground instead of using air
    Ground Hog! Find "lost $"
  • G2 Report Card Ship Profile no graph
    • To profile shipping activity for use in better understanding actual shipping useage
    • Will be used in evaluating carrier RFP - FUTURE
  • G2 Report Card Ship Profile with Graphs
    • Easy to view and compare carriers
    • Easy to view and compare zones and services
  • The Carrier Performance Report
  • Product Cycle Speeds vs. Reality Don’t base your expectations on what the brochure claims the machine can do! Real World include:
    • Operator Skill Level
    • Time to Stage Materials – Room to work
    • Time to Load Hoppers –
    • High Capacity Feeder vs. Std
    • Time to Empty – Tray vs. conveyors
    • Stoppages
    • Interruptions and Breaks
  • Product Cycle Speeds vs. Reality Don’t base your expectations on what the brochure claims the machine can do! Averages – Real World vs. Educated Guess
    • Folders – Based upon Paper already Jogged, or one nearby.
    • 33% of Cycle Speed, Tray
    • 85% with conveyor
    • Tabber, Labeler, Ink Jet Printer
    • 33% of Cycle Speed, -Due to Material Staging
    • 50% with conveyor -
    • Mail Machines – Based upon Mail already Staged / Trayed
    • 50% of Cycle Speed, Tray
    • 75% with conveyor
  • How to calculate ROI – First Figure out Gross Potential Savings   Note : this is based upon the assumption that the bulk of the mailing will qualify for 5 Digit Sortation. Dropping 4 mailings of 2,000 per month at Carmel Mtn Ranch $20,832.00 $1,736.00 Savings   $16,608.00 $1,384.00 $0.173 Proposed "Automation" rate of $.173 $37,440.00 $3,120.00 $0.39 Current method - # of pieces at First Class rate of $.39 96,000 8,000 Average Number of Pieces   Yearly Monthly Units Postage Savings             Automation Compatible Mailings     Due to Work share Incentives by Preparing     SAVINGS ANALYSIS
  • $6,048.00 $504.00 Savings   $672.00 $56.00 2,000 Automatic - 4,000 per hour (based on 2 tabs/passes) $6,720.00 $560.00 200 Manual - 200 per hour   Tabbing $6,552.00 $546.00 Savings   $168.00 $14.00 8,000 Automatic - 8,000 per hour $6,720.00 $560.00 200 Manual - 200 per hour   Folding $3,920.00 $326.67 Savings   $560.00 $46.67 2,400 Automated - Direct Impression Printer at 2400 per hr. $4,480.00 $373.33 300 average labor rate w/overhead at $14 per hour   Manual application based upon 300 per hour and an   Label Affixing   $14.00 Labor Rate Per Hour Yearly Monthly Units Labor Savings
  • Yearly Monthly Units Labor Savings - Continued         $38,733.33 $3,227.78 TOTAL   $20,832.00 $1,736.00 Total Postage Savings   $17,901.33 $1,491.78 Total labor Savings   ($336.00) ($28.00) Savings   ($336.00) ($28.00) 2 Software Generated - 30 minutes per mailing (2 Hours/ Month) $0.00 $0.00 0 Manual - 4 hours - N/A paying First Class   Presorting, Reports, etc ($672.00) ($56.00) Savings   ($672.00) ($56.00) 4 Proposed Method (1 Hour per mailing X 4 Mailings) $0.00 $0.00 0 Current Method N/A   Delivery & Presentation to Bulk Mail Acceptance Facility $2,389.33 $199.11 Savings   $298.67 $24.89 4,500 Automatic - 4,500 per hour $2,688.00 $224.00 500 Manual - 500 per hour   Postage
  • Payback Period (non discounted, no EMA)
    • Payback Period = Total Costs / Monthly Savings
    • In this example:
    • Proposed Monthly lease = $328 per month or $16,000 if Purchased.
    • Purchase “Payback Period” is 5 months $16,000/$3228
    • Lease Payback Period is .1 months $328/3227
  • ROI (non-discounted)
    • Why Calculate your “Return on Investment”
    • The ROI is another way of looking at the investment by considering the cost in relation to the "profit" or return on an investment
    • ROI = Savings/Costs x 100
  •   807% Purchase ROI = Savings/Cost x 100 = $ 193,665 $24,000 5 Year Total   $ 38,733 $ 1,600 Maintenance 5 $ 38,733 $ 1,600 Maintenance 4 $ 38,733 $ 1,600 Maintenance 3 $ 38,733 $ 1,600 Maintenance 2   $ 1,600 Maintenance 1 $ 38,733 $16,000 Equipment Purchase 1 Net Annual Savings Cost Description Year Purchase ROI - Non Discounted
  •   653% Lease ROI = Savings/Cost x 100 $ 154,932 $23,744 5 Year Total     $ 1,600 Maintenance 5 $ 38,733 $ 3,936 Yearly Lease Expense 5   $ 1,600 Maintenance 4 $ 38,733 $ 3,936 Yearly Lease Expense 4 $ 1,600 Maintenance 3 $ 38,733 $ 3,936 Yearly Lease Expense 3   $ 1,600 Maintenance 2 $ 38,733 $ 3,936 Yearly Lease Expense 2   $ 1,600 Maintenance 1 Net Annual Savings Cost Description Year Lease ROI - Non Discounted
  • Work-flow design
    • Why Modular Furniture is better than built in cabinetry
    • Design Goals – Ergonomics, Security, Separation, Supervision, Performance and Space Utilization
    • Why its best to not sort Mail off a 30”h Table
    • Determine Size of Shelf before design
    • VSI vs. # of openings
    • Compromises – When Budgets, Space and Goals conflict
    • Which Tables should be open vs. Cabinets
    • What about Specialty Risers? Plexiglas Backs?
    • How easy it to adjust shelves and change
    • Index / Labels
    • Is there a “Production Workflow” to the design?
    • Is there enough room – Equip, Materials, etc
    • Metal vs. Wood
    • Is that really the color you want to live with?
    Work-flow design (con’t)
  • Managing a Growing Mail Center
    • Resources
    • Shape Based Pricing – 6 ways to save $
    • USPS compliance
    • Marketing Tips
    • Latest Technology
    • Performance Benchmarks
    • Product cycle speeds vs. Reality
    • How to calculate Payback and ROI
    • Mail Center - Work-flow design
  • Questions?
    • Contact Info: Gordon Glazer, CMDSM, CMDSS, MQC
    • President
        • San Diego Postal and Shipping Equipment
        • 12255 Crosthwaite Circle
        • Poway, CA 92064-6883
        • 858-513-6300 x112
        • [email_address]
    Servicing San Diego County Mail Centers Reliably Since 1986 www.sdpostal.com