Cataloger coalition files motion with PRC for more time

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The Coalition of Catalog Mailers has petitioned the Postal Regulatory Commission to reopen the postal rate case record to permit testimony that calls for giving catalog companies a reasonable transition period to adjust their businesses in light of the upcoming rate increases.

Earlier this month, the PRC granted the CCM its request for more time to file a motion to open the record for reconsideration of its recommendations for Standard Mail flat rates, some of which may increase more than 40 percent. In granting this motion, the PRC has also suspended the deadline for comments.

"CCM's objective is to permit catalog companies a reasonable transition period to adjust their business in the most efficient manner possible," the CCM said in the April 12 filing.

"CCM offers to provide the commission specific information, on the record, describing the practical difficulties that catalog mailers will experience in responding to unexpectedly high rate increases beginning on May 14, 2007."

CCM said that many of these difficulties could be avoided "by allowing catalog companies adequate lead time to work with the Postal Service vendors to make significant changes in an essential component of their business plans."

CCM is an ad hoc coalition of several mailers. Original members include Asset Marketing Services Inc., Blair.com, Cornerstone Brands Inc., Crate & Barrel, Lmitedbrands Direct Media Production Inc., Miles Kimball Co., Mason Companies Inc., Oriental Trading Co., Potpourri Group Inc., Redcats USA Inc., Ruston Print Group Inc. and the Wine Enthusiast Companies.

New members include Audio Partners, California Car Cover Corp Inc., Direct Marketing Services Inc., MeritDirect, Northern Safety Co. Inc., Positive Promotions and Venus Swimwear Inc./Watersilks LLC.

On March 19, the governors of the USPS issued a decision approving the PRC's average 7.6 percent rate increase, with requests for reconsideration of the Priority Mail Flat Rate Box, the non-machinable surcharge for First Class Mail letters and Standard Mail flats.

The PRC issued its procedural schedule on March 29 for the USPS' rate reconsideration of all three categories. According to the filing, initial comments on these rates were due no later than April 12 and reply comments were expected by April 19. Motions to reopen the record were due no later than April 4 and answers were expected by April 11.

On April 3, the CCM filed for late intervention in the case, together with a request for an extension of time to submit a motion to reopen and supplement the record for reconsideration. In an April 5 filing, the PRC said the dates for comments and reply comments related to Standard Mail flats would be deferred.

CCM said it is offing testimony from a single witness, Edward J. Spiegel, a professor of integrated marketing communication at Northwestern University. The CCM said because the CCM did not have meaningful notice of the magnitude of the recommended rate increase "it cannot be deemed to have had an opportunity to proffer testimony during the hearings on the need for a gradual transition to those rates."

It added that it estimated professor Spiegel's testimony should take no more than one hearing day and that "estimated discovery, cross-examination, and briefing cornering his testimony can be concluded within 60 days of reopening the record."

In conclusion, the CCM said a healthy, growing catalog industry benefits the Postal Service as well as the entire mailing industry.

"Imposing unexpected rate increases of the magnitude recommended by the commission without adequate lead time will unnecessarily threaten the vitality of the catalog industry," the CCM said. "If the commission reopens the record, CCM will submit evidence that much of the potential damage from these rate changes and the resulting economic waste can be avoided by allowing catalogers time to prepare for the changes."

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