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How To Save 60% On Your Mailing Equipment Fleet

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A guide on the importance of gaining control of your mailing fleet and strategies on how to optimize savings and efficiency in this category.

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How To Save 60% On Your Mailing Equipment Fleet

  1. 1. How To Save 60% On Your Mailing Equipment Fleet
  2. 2. Adam Lewenberg - Background and Experience • President of Postal Advocate Inc. – The only mail audit and recovery firm in the US and Canada – Manage a portfolio of over 61,000 pieces of mailing equipment for the largest US companies. – Speak and teach nationally on mail savings and industry trends. • Industry Co Chair- Boston Postal Customer Council/Mail Systems Management Association member. CMDSS and MDC Certifications. • Featured Writer for Mailing Systems Technology Magazine. • Worked for one of the largest mailing vendors for over 17 years – Director of national sales for presort, tabletop inserters, addressing hardware/software and green offerings. – Was one of the top 5 account managers nationally working with some of the nations top accounts. • Not affiliated with any mailing vendor - Unbiased advice. September 29, 2016 2
  3. 3. Equipment Savings Process September 29, 2016 3 Current Challenges: Optimized Mailing Fleet Asset Management 1. Gain visibility to your equipment and spends. 2. Validate questionable charges. 3. Negotiate enterprise pricing and terms. 4. Work with locations on equipment changes. 5. Eliminate fees and overcharges 6. Maintain postage balances and claim lost funds. 7. Continual review to ensure savings. This process leads to 30-70% savings!
  4. 4. 4 Challenges of Managing Fleet Mailing Assets Areas for improvement Mailing spend – low priority Lack of understanding of mail category No centralized oversight No control of rogue spend Difficult to assess needs or requirements No published pricing for comparison Multiple postage accounts to fund and maintain Inconsistent prices for similar equipment Poor visibility Unclear invoices
  5. 5. Challenges With Mailing Equipment Purchasing 1. Huge price variances for similar models at different locations across your fleet September 29, 2016 5 Example: Model Pricing Variance Model Quantity Low High Average High/Low Ratio Total Expense Total if all at Low Rate Model A 9 $348 $701 $459 2.0 $4,133 $3,132 Model B 36 $345 $1,573 $801 4.6 $28,839 $12,420 Model C 26 $427 $2,063 $1,296 4.8 $33,703 $11,102 Model D 13 $1,427 $2,760 $2,019 1.9 $26,250 $18,551 Model E 26 $1,524 $4,467 $2,666 2.9 $69,325 $39,624 Model F 5 $3,251 $6,276 $5,352 1.9 $26,764 $16,255 Model G 5 $7,848 $9,931 $8,931 1.3 $44,655 $39,240 Total 120 $233,669 $140,324 Potential Savings $93,345
  6. 6. September 29, 2016 6 2. Expired or non existent Master Service Agreement 3. Lack of visibility to postage spends and usage levels. Companies buying the wrong levels of equipment. In many cases spending more on equipment than postage/usage. Spend Ratios Postage Range # of Sites Equipment Spend Postage Spend Spend Ratio >$12,000 per year 2 $26,600 $63,500 0.42 $1200-12,000 per year 64 $189,054 $155,441 1.22 <$1,200 per year 76 $120,291 $41,890 2.87 Challenges With Mailing Equipment Purchasing Main Cause – Reliance on mailing vendor to work with the locations to define requirements combined with declining mail volumes.
  7. 7. September 29, 2016 7 Challenges With Mailing Equipment Purchasing 4. Vendor inventory reporting is infrequent, unavailable and confusing 5. Lease portfolios with varying end dates often going into evergreen statuses. Lease Renewal Dates Lease Expiration Year # of Sites Value 2013 or Before 19 $28,404 2014 9 $12,198 2015 34 $62,193 2016 26 $54,455 2017 19 $30,795 2018-20 22 $35,691 Total 129 $223,736 68% of your leases are coming up over the next year.
  8. 8. Visibility and Oversight Most important step • Get reports from your vendors that list: – Account Numbers (Install, Lease, Prepaid and Advance Postage) – Lease Information – Rate, Term, End of Lease, Items covered. – Meter rentals and maintenance agreements. – Model, serial number and description of every item. • Go to accounts payable and pull spend reports from the main mail vendors and USPS. • Enter your account numbers on the vendor websites. • Monitor your inventory, invoices and postage balances online (Recommended to do this monthly). • Find all active locations with equipment. • Set up a schedule for continual review. September 29, 2016 8
  9. 9. How Postal Advocate can help • We can work with all vendor’s data and can build this visibility. • We maintain this data in our enterpriseAdvocate System and provide you access. • We update this data monthly. • We use this data to drive savings across your mailing fleet. September 29, 2016 9
  10. 10. enterprise Advocate – Fleet Asset Management System - Dashboard September 29, 2016 10 Highlights • Graph representing full fleet expenses broken down by category (Leases, meters, fees, maintenance, postage spend and spend ratios) *The data above is for demonstrative purposes only. Data does not represent true spends and costs. Graphic Representation of Total Mailing Expenses
  11. 11. enterprise Advocate – Fleet Asset Management System – Location List September 29, 2016 11 Highlights • Easy access to all mail spends. • Visibility to fees and savings. • All account numbers are stored in one place. • Simple to drill down to an individual location or invoice. *The data above is for demonstrative purposes only. Data does not represent true spends and costs. Spend Ratio Location equipment cost compared to the postage usage
  12. 12. enterprise Advocate– Multi Location System September 29, 2016 12The data above is for demonstrative purposes only. Data does not represent true spends and costs. Highlights • Complete visibility to all mailing spends by location. • Can see detail for multiple vendors. • All account numbers are stored in one simple to access place.
  13. 13. Validate Equipment Spends with Locations We typically find 5-15% of a mailing fleet is not needed and can be returned. • Bills often sent to accounts payable with limited review. • Locations not surveyed about the equipment at the location. • Little understanding of the equipment listed on bills and reports. • Vendors have little incentive to validate suspect equipment because of lost revenue. • Equipment may be sitting in storage with charges accruing. September 29, 2016 13 Criteria for Search: • Meters not filled for over 6 months. • Expired leases. • Maintenance and meter rentals. • Equipment over 5 years old. • Folders, inserters, openers, shipping and tracking systems.
  14. 14. Postal Advocate Validation Process September 29, 2016 14 1. Find suspect equipment and charges. 2. Contact the location to validate needs. (See below). 3. Implement changes and cancellations.
  15. 15. Develop an Equipment Purchasing Strategy How Postal Advocate Can Help • Use national spend to negotiate better rates. – We can pull this spend together for the US and Canada. • Consider running a bid between the main mailing vendors. (Pitney Bowes, Neopost, FP, Stamps.com) – We have bid templates ready that we have used to negotiated for the largest mailing fleets. • Negotiate Master Service Agreement and Terms. – We can add and review terms to protect you for the future. • Define the order process inside your organization. – Purchase vs. lease vs. rental? • We can guide you through your options. – How are the equipment needs defined? • Postal Advocate will work with your locations to show options and help implement changes. – Where are approvals done? – How can the policies be enforced? • Postal Advocate will manage this process to ensure rules are being followed. September 29, 2016 15
  16. 16. Choose the right system for each location September 29, 2016 16 Low Mid High Typical Monthly Postage Use <$500 $500-5,000 >$5,000 Equipment Speed 15-45 Letters/Min 50-180 Letters/Min 70-310 Letters/Min Feeding Hand Feed Hand or Auto Feed Auto Feed Sealing Some Models Included Included Meter Tapes For Oversized Items Strip Tape Sheets (Fed like an envelope) Strip Tape Dispenser Strip Tape or Roll Tape Dispenser Weighing (External Scale) 2-10LB 2-149LB 2-149LB Weighing (Internal Scale) N/A Higher end models Optional Postal Accounting Summary Info only Summary or Transaction Level Summary or Transaction Level Additional Printing Capability Simple Meter Ads and Endorsements Simple Meter Ads and Endorsements Optional - Customized return address and Graphics Printing Space Requirements - LxWxH < 29"x18"x13" 30"x15"x12"- 80"x25"x24" 58"x23"x17"- 104"x23"x33" Typical Supply Costs - Ink and Tape (Per Impression) Ink - $.01-.06, Tape $.05-.13 Ink - $.003-.03, Tape $.04-.08 Ink - $.003-.005, Tape $.01-.04 Typical Monthly Lease Price $25-125 $125-500 >$500 Mailing System Type Additional Equipment Guides can be found on our website: www.postaladvocate.com • Inserters • Addressing Systems • Envelope Printers • Mail Automation Software • Incoming Tracking Systems • Shipping Systems • PC Postage • Letter Openers and Extractors • Mail Accounting Systems
  17. 17. Renewal Process • Who works with the locations to define the needs and provide options? (Vendor, staff) • What review process is set up to make sure it is the right solution? • How do you protect against: – Evergreen clauses – Remaining balances – Unauthorized lease extensions – Unneeded equipment or wrongly sized models – Locations not getting national account discounts • Who follows up with each location to make sure new equipment is set up and the old equipment was removed? September 29, 2016 17
  18. 18. Postal Advocate Equipment Renewal Process September 29, 2016 18 Step 1: Customized Renewal Email Implement renewals, terminations and new equipment needs. Analyze current pricing and terms. Set Standardized equipment rates and updated MSA’s. Document all new equipment, savings and notes. Work with locations to define needs and show options. 1 2 3 4 5 Postal Advocate Equipment Savings Stats SavingsType #of Transactions Total Savings %of Savings EquipSavings: New 245 632,406$ EquipSavings: Renewal 2556 16,928,994$ EquipSavings: Terminate 846 1,424,947$ Total 3647 18,986,346$ 60%
  19. 19. Renewal Email September 29, 2016 19 Detailed Location Information Company Defined Purchasing Process. Compare Current Equipment and Costs to new options. Detailed description on all equipment. Web, PDF and Video links for more information.
  20. 20. Step 2: Equipment Change Request Form September 29, 2016 20
  21. 21. Step 3: Equipment Ordered Validation with Instructions September 29, 2016 21
  22. 22. Step 4: Client Validates Completed Request September 29, 2016 22
  23. 23. Eliminating Vendor Fees/Overcharges • Pay bills on time. • Look at each invoice and validate all chargeable items. • Cancel vendor equipment insurance. • Terminate chargeable loyalty programs. • Make sure postage refill and advance charges are included or monitored. September 29, 2016 23 Postage Refill Fees - Rentals $0-20 each Postage Advance Fees Included or up to 1% of the Advance Postage Advance Late Fees 0-15% of the Advance Postage Advance Finance Charges 15% or higher APR Overlimit Credit Charge Varies by Vendor Annual Fee Rewards Program Varies by Vendor Lease Late Fees Varies by Vendor and Lease Value Insurance - Leases Only Varies by Vendor and Lease Value - Automatic enrollment unless proof insurance is provided. Mailing System Fees We find companies paying tens of thousands in fees and overcharges that can be recovered or eliminated for the future. Postal Advocate Avoidable Fees and Overcharges Savings Stats 1,886 Transactions - $1,106,051 Typical Vendor Overcharges Invoices notgiving national accountdiscounts. Meter, maintenanceand ratechangecharges when included on a lease. Bills for equipmentfromclosed sites. Resetand advancepostagefees thatshould beincluded. Loyalty points thatgo undredeemed or cashed in for personal use.
  24. 24. Postage Funding – Prepay or Advance • Prepay Advantages – No fees • Advance Advantages – Convenience • Don’t be fooled by earning interest on prepaid balances. • Choose one postage payment method and stick with it - don’t flip flop. • Check balances in the meter and in the postage account. • Think twice about ACH. • Consolidate into master accounts whenever possible. • Postal Advocate can help manage your postage accounts to ensure optimal funding. September 29, 2016 24
  25. 25. Lost Postage Recovery • We have found over $2,400,000 in lost postage sitting in dormant postage accounts. Plus over 21,000 transactions turned over to the states. This happens because: – Offices close, merge or just turn in their meters. – The money is expensed once sent in for postage. – The advance account is used when funds sit idle in the prepaid. • Steps to find money. – Find account numbers of your current and past meters. – Enter these account numbers online on the vendors website to see if any data is available. – Contact your meter vendor to validate funds available. – Check the unclaimed funds databases to see if funds were turned in. Postal Advocate can research these funds and help you get them returned quickly. September 29, 2016 25
  26. 26. Cash in Loyalty Points • Pitney Bowes has a rewards program that gives you points for purchasing postage, supplies or other services that can be linked to the Purchase Power account. • These points oftentimes sit idle or are not understood. • Points can be turned in for: – Purchase power credits that can be used for postage and supplies. – Personal gifts Postal Advocate can help cash in these points for you before they expire! September 29, 2016 26
  27. 27. Supplies Strategies • Buy in bulk – Most vendors will give you published discounts if you buy multiple ink cartridges and meter tapes. • Check third party non OEM (Low Volume) – There are many companies out there offering non mailing vendor based supplies that may be a consideration. The major office supply stores are also carry this ink for low end meters. Find out from your manufacturer if there is any binding agreement where you are required to use their supplies. • Ask for discounts – If you have multiple locations or are buying large amounts of supplies, ask if you are eligible for any additional discounts. It never hurts to ask. September 29, 2016 27 Low Mid High Typical Supply Costs - Ink and Tape (Per Impression) Ink - $.01-.06, Tape $.05-.13 Ink - $.003-.03, Tape $.04-.08 Ink - $.003-.005, Tape $.01-.04 Mailing System Type
  28. 28. Helping multi-location organizations streamline their mailing costs 61,300 pieces of equipment, managed by Postal Advocate Recovered over $5,000,000 in lost postage, vendor overcharges and fees ENTERPRISE-WIDEMAILAUDITANDRECOVERY OVER $25,000,000 IN CLIENT SAVINGS $697K 60% Average Client Savings Average Equipment Savings HOW WE DO IT • 250+ years of industry experience • Comprehensive web-based tool providing visibility of all mail and equipment spend • Time Savings - Assistance in fleet management visit www.postaladvocate.com or call (888)977-MAIL(6245)
  29. 29. Sign Limited Agency Agreement/Kick-Off Call. Provide copies of vendor invoices, AP export, location list, equipment inventory list. Present savings opportunities and get client approval. Postal Advocate provides ongoing support, manages renewals, billing and vendor compliance. Provide enterprise visibility of all spend, costs and documented savings through enterpriseAdvocate. Provide client log-in. 1 2 3 4 5 6 HOW IT WORKS Work with current vendor to build population report, contract terms/start/end dates, postage volumes, costs. Analyze spend, check for contract compliance, billing errors, vendor fees/overcharges, lost postage. Identify savings opportunities. Submit vendor credit requests, lost postage forms and eliminate avoidable fees. Negotiate pricing. Create catalog. Work with locations - asset validation, rightsize, termination… Full implementation of savings. visit www.postaladvocate.com or call (888)977-MAIL(6245) Conduct Analysis NO COST – AUDIT PHASE CONTRACTED CLIENT
  30. 30. Free No Obligation Mailing Fleet Analysis • Completed in 2-3 weeks • Outlines, spend and specific savings opportunities • Minimal client involvement September 29, 2016 31 Savings Summary Locations Meter Rentals Maintenance Agreements On Call Maintenance Lease Total Postage Spend Ratio 0.00 Item Current 2015 2016 2017 Savings Combined Savings Equipment Costs Avoidable Fees (Late Fees, Finance Charges, Equip Insurance, Loyalty Plans) Contract Violations (Supply, maintenance, meter discounts, overcharges) Lost Postage Funds (Meter Accounts) Lost USPS Permit Funds Total $0 $0 $0 $0 $0 $0
  31. 31. Equipment Savings Process September 29, 2016 32 Summary Optimized Mailing Fleet Asset Management 1. Gain visibility to your equipment and spends. 2. Validate questionable charges. 3. Negotiate enterprise pricing and terms. 4. Work with locations on equipment changes. 5. Eliminate fees and overcharges 6. Maintain postage balances and claim lost funds. 7. Continual review to optimize savings and spend. This process leads to 30-70% savings!
  32. 32. Future Webinars: Register at www.postaladvocate.com Wed Oct. 19, 2016 - 1pm EST - Top 9 Ways To Recover Lost Postage Thurs Nov. 17, 2016 – 1pm EST – The Ultimate Tour – Multi-Location Fleet Management System – enterpriseAdvocate System September 29, 2016 33
  33. 33. Contact info: (20pt) September 29, 2016 34 Questions? Contact: Adam Lewenberg - President 888-977-MAIL X 501 adam.lewenberg@postaladvocate.com

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