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January 2014 USPS Price and Regulatory Changes for Mail and Shipping
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January 2014 USPS Price and Regulatory Changes for Mail and Shipping

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The USPS® has proposed price, service and regulatory changes, effective as of January 26th, 2014. These changes will affect postage and other fees associated with mail shipments, as well as introduce …

The USPS® has proposed price, service and regulatory changes, effective as of January 26th, 2014. These changes will affect postage and other fees associated with mail shipments, as well as introduce an exciting new “discounted rate category” called First-Class Metered Rate. This category will save mailers one-cent on each First-Class® letter with postage affixed by meter.

We’ll also discuss the overall impact of price and regulatory changes for letters, flats, and some competitive products like Priority Mail Express™. You’ll learn about products that are not increasing in price and strategies that will help minimize the impact of change to your bottom line.

Presented: December 10, 2013

Published in: Business

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  • 1. January 2014 USPS® Price and Regulatory Changes for Mailing and Shipping Services January 14, 2014
  • 2. Your presenter Dr. Janet Lockhart-Jones joined Pitney Bowes in September 2012 to fulfill the cross-enterprise role of Curriculum Manager, Postal Education. In this capacity, Janet serves as a postal education trainer, Subject Matter Expert (SME) and consultant to Pitney Bowes and its clients. Janet’s professional career includes 15+ years with the United States Postal Service and 10 years as an independent leadership development and learning consultant servicing the hi-tech industry. Janet holds the degrees of Doctor of Education, Master of Science in Human Resources Management and Bachelor of Science in Business. She is the Postal Education Chair of the Sacramento Postal Customer Council (PCC), a member of MSMA, and is a Certified Mailpiece Design Consultant (MDC). January 14, 2014
  • 3. Session Objectives  Understand 2014 USPS® price and regulatory changes impacting the mailing industry  Walk-away from the session with greater clarity on how the 2014 proposed changes will affect your mailing operations  Understand the changes and opportunities that are available to reduce postage expenditures January 14, 2014
  • 4. Agenda WHAT’S INSIDE  Highlights, details, and cost saving strategies for:  First-Class Mail®  Special Services  Shipping/Competitive products  Pitney Bowes Resources January 14, 2014
  • 5. Classes of Mail Affected – Market Dominant First-Class Mail®  Single-Piece Letters & Cards  Presort Letters & Cards  Flats  Parcels  Outbound Single-Piece International Periodicals Special Services Standard Mail® Letters Flats Parcels High Density/Saturation Letters Every Door Direct Mail Retail Parcels Package Services Bound Printed Matter (BPM) Flats BPM Parcels Media, Library Mail Alaska Bypass January 14, 2014
  • 6. Background Proposed Market Dominant Price Adjustments 1. Consumer Price Index-Urban (CPI-U) Price Proposal (Approved w/Full-Service IMb™ Exception)  Average price increase of 1.69% 2. Exigent or Above-the-Cap Price Proposal (Approved)  Average price increase of 4.30% 1.69% CPI + 4.30% Exigent = 5.99% overall average increase Proposed Shipping Services/Competitive Products Price Adjustment) (Approved)  Overall price increase is 2.4% January 14, 2014
  • 7. NEW: First-Class Meter Rate Save 1¢ on First-Class letters that have postage affixed using: Postage Meter PC Postage Permit Imprint Pre-canceled stamps 48 49 No piece minimums No preparation requirement No requirement to report those pieces on a postage statement The new price category will be based on incremental weights up to 3.5 oz. Metered pieces claiming the new “Meter Price” will have postage applied directly to the pieces, and will be deposited as “Retail mail”. January 14, 2014
  • 8. First-Class Mail® Change Highlights  Retail First-Class Single-Piece one-ounce letter increase − From $0.46 to $0.49 cents − Metered FC letters $0.48  Changes to residual First-Class Mail letters price structure  The USPS® continues to price AADC and 3-Digit Letters and Cards at the same level  Second-ounce free continues for all Presort First Class Mail letters (Non-automation and Automation)  Full-Service Intelligent Mail® barcode $.003 incentive maintained  Full-Service Intelligent Mail mandate – not approved; delayed until after 2014 January 14, 2014
  • 9. Special Services Change Highlights 1 Certificate of Mailing Basic Firm Book Mailing Bulk: First 1,000 pcs Each Add’l 1,000 pcs January 26, 2014 $1.30 0.47 7.80 0.95 Certified Mail $3.30 Return Receipt Requested at time of mailing Electronic Green Card Merchandise Requested after mailing $1.35 2.70 4.40 5.25 January 14, 2014
  • 10. Special Services Change Highlights 2 USPS Tracking First Class Mail (Parcels Only) First Class Mail (Parcels Only) First Class Package Service Priority Mail Priority Mail Standard Post Standard Mail Parcels Package Services Package Services Parcel Select Electronic Retail Electronic Electronic Retail Electronic Retail Electronic Retail Electronic Electronic January 26th, 2014 $1.05 0.00 0.00 0.00 0.00 0.00 0.23 1.05 0.23 0.00 Electronic Retail January 26, 2014 $2.35 2.90 Signature Confirmation January 14, 2014
  • 11. Key Details January 14, 2014
  • 12. First-Class Mail® Retail  Letters (1 oz.)  $0.46 to $0.49  $0.48 New Metered Rate  Letters additional ounces  $0.21  First –Class Mail® International Global Forever Stamp (1 oz.) – $1.10 to $1.15  First Class Postcards Price change  $0.33 to $0.34 January 14, 2014
  • 13. Key First-Class Mail® Single-Piece Prices *all prices one ounce Current Price January 26, 2014 Stamp Price 0.46 0.49 Metered Price 0.46 0.48 Single-Piece Flats 0.92 0.98 Single-Piece Cards 0.33 0.34 Retail Parcels 2.07 2.32 January 14, 2014
  • 14. January 14, 2014
  • 15. First-Class Mail® Retail Parcels  First 3 ounces in each FCM parcel category still a single price cell  $.18 additional ounce price after 3 ounces Oz. 1 2 3 4 5 6 7 8 9 10 11 12 13 Current 2.07 2.07 2.07 2.24 2.41 2.58 2.75 2.92 3.09 3.26 3.43 3.60 3.77 January 14, 2014 26-Jan 2.32 2.32 2.32 2.50 2.68 2.86 3.04 3.22 3.40 3.58 3.76 3.94 4.12
  • 16. Commercial Residual Single-Piece Letters: Two Options Mailers may continue using current preparation standards  Residual 1oz and 2oz pieces presented in the same tray receive the blended price on those pieces NEW: Mailers have the option of separating out 1oz and 2oz pieces and paying the lower metered rate Weight Not Over (ounces) 1 2 Blended January 14, 2014 26-Jan $0.48 $0.69 $0.50
  • 17. IMb® Full- Service Mandate Beginning in January 2014, the USPS® is requiring mailers receiving automation discounts to be Full-Service IMb™ compliant. Full Service Intelligent Mail® was proposed to REQUIRED for:  Postcards (First-Class Mail® only)  Letters, and flats when mailed using:  First-Class Mail®  Standard Mail®  Periodicals®  Flats mailed at Bound Printed Matter® prices January 14, 2014
  • 18. “Why should I still move forward with FullService IMb™?”  It's not going away  Leverage the $$$ already spent  Save $$$ - reduce your mailing costs  Use the barcode intelligence to make information-based business decisions  Enhanced Visibility  Free Address Change Service  Take advantage of cost-saving promotions – all require Full-Service IMb™ participation January 14, 2014
  • 19. Promotions Overview Mobile Technology Promotions Encourages mailers to integrate direct mail with mobile technology using best practices in mobile marketing  Branded Color Mobile Technology  Emerging Technology Featuring NFC  Promotion Mail Drives Mobile Commerce Promotion Technology Drives Relevance Leverage the value of innovative direct mail techniques that are less widely used, but have been shown to increase effectiveness of mail campaigns  Color Print in First-Class Mail® Transactions Promotion  Mail and Digital Personalization Promotion January 14, 2014
  • 20. Promotions Overview Leverage Value of First-Class Mail® Intended to slow the volume decline in First-Class Mail by ensuring reply mail, transactional mail and First-Class advertising remain a relevant part of the First-Class Mail marketing mix  Premium Advertising Promotion  Earned Value Promotion New Customer Acquisition Provides an extra incentive for new customers to try direct mail  EDDM Coupon Promotion January 14, 2014
  • 21. Branded Color Mobile Technology Promotion Registration opens December 15th – March 31st Promotion Period: February 1 – March 31st, 2014 2% upfront discount January 14, 2014
  • 22. Promotion Details http://ribbs.usps.gov January 14, 2014
  • 23. Agenda WHAT’S INSIDE  Highlights, details, and cost saving strategies for:  First-Class Mail®  Special Services  Shipping/Competitive products  Pitney Bowes Resources January 14, 2014
  • 24. Shipping Services - Classes of Mail Affected          Priority Mail Express™ Priority Mail® First-Class Package Service™ Parcel Select® Standard Post™ Extra Services Return Services Mailer Services Recipient Services January 14, 2014
  • 25. Competitive Services Average increases Product Priority Mail Express™ Priority Mail® Average Increase 3.0% Net 0% First Class Package Service™ 5.0% Parcel Select® 9.2% Standard Post™ 5.2% January 14, 2014
  • 26. Shipping Services Change Highlights • Priority Mail® - Average net ZERO price increase in Retail and CBP • New Priority Mail Express™ 10:30 a.m. delivery time option for an additional $5.00 • New Flat Rate Commercial Base and Commercial Plus prices for Priority Mail Express International and Priority Mail International • Intelligent Mail® package barcode required on all commercial parcels • A fee of $0.20 assessed on commercial parcels without an Intelligent Mail Package Barcode (IM®pb) when the targeted thresholds have been exceeded. • Meter customers are exempt from the 20-cent surcharge • Meter customers must adopt an IMpb compliant solution by January 2015 or lose Commercial Base Pricing (CBP) • New labels forthcoming for meter customers. January 14, 2014
  • 27. Key Details Shipping Services January 14, 2014
  • 28. Priority Mail Express™  Overall average price increase of 3%  Pricing by Zone, Retail, Commercial Base and Commercial Plus continues  Retail Flat Rate Envelope, Legal Flat Rate Envelope, and Padded Flat Rate Envelope is increasing from $19.95 to $19.99.  Flat Rate Box price is increasing from $39.95 to $44.95.  Eliminate 12:00 Noon delivery for items Post Office to Addressee or to PO Box  Optional 10:30 am delivery for a fee of $5.00 ( but not available between all origin-destination ZIP codes)  Priority Mail Express “Hold for Pickup” available by 10:30 for no additional charge January 14, 2014
  • 29. Priority Mail®  Overall average net zero (0%) price increase.  Many Priority Mail Flat Rates are NOT changing. Exception: Large Flat Rate Box is increasing from $16.85 to $17.45.  Commercial Plus and Commercial Plus Cubic volume thresholds being lowered to 50,000 pcs  Free USPS Tracking and $50 insurance continues with Retail or IMpb compliant barcode. Up to $100 of insurance for Commercial Plus January 14, 2014
  • 30. Intelligent Mail Package Barcode (IM®pb)  Required on ALL Commercial Parcels/Packages  $0.20 per piece surcharge for pieces failing to meet the January 26 th standards for IM®pb use and falling outside established thresholds.  Meter customers are EXEMPT from the surcharge; they have until January 2015 to adopt an IM®pb compliant solution. After this date, retail prices apply.  Label 400 (existing) or IM®pb complaint barcode, or new USPS supplied labels will be accepted from meter customers throughout 2014 and are required for Commercial Base Pricing (CBP).  A new label is forthcoming for meter customers to use with Priority  Mail® pbSmartPostage™ and SendSuite Live™ are IM®pb enabling solutions January 14, 2014
  • 31. Intelligent Mail Package Barcode (IM®pb) Exclusions  Parcels paid at retail price and inducted through a retail transaction  Periodicals parcels  Standard Mail® Marketing parcels sent as product samples that bear a simplified address or those using a detached address label (DAL)  Priority Mail® letters and flats using stamps for postage payment and mailpieces using Priority Mail Forever Prepaid Flat Rate packaging.  Priority Mail letters and flats prepared in a high-speed environment may, upon authorization, use an Intelligent Mail barcode (IMb™) in lieu of an IMpb provided each of these pieces bear a unique IMb that cannot be reused for 45 days, and are supported by Mail.dat or Mail.XML. January 14, 2014
  • 32. Intelligent Mail Package Barcode (IM®pb) Surcharge example: January 14, 2014
  • 33. Summary  CPI price proposal for Market Dominant Products  The new Meter Rate category will afford meter customers a one-cent discount off First-Class stamped letters.  Shipping Services/Competitive Products proposal filed.  Exigent Price Proposal  Full-Service Intelligent Mail mandate for letters and flats was not approved  Intelligent Mail® package barcode required for all commercial parcels  Cost saving alternatives are plentiful January 14, 2014
  • 34. USPS® news sources you can rely on http://www.pb.com/ January 14, 2014
  • 35. USPS® news sources you can rely on http://www.pb.com/postal-information/ January 14, 2014
  • 36. USPS® news sources you can rely on http://blogs.pb.com/usps-news/ January 14, 2014
  • 37. We appreciate your business THANK YOU. January 14, 2014