*DMA Board Passes 'No Confidence' Resolution In USPS
The no confidence resolution was in response to the USPS' overall proposed postal rate increase of 6.4 percent, an average 7.7 percent increase for bulk advertising mail and a 15 percent increase for other categories of mail.
The board voted that it lacks confidence in the USPS to provide direct marketers with the affordable services they require, and that without some immediate change, the rate request will drive marketers headlong to the Internet, spelling long-term doom for the agency.
In general, they agreed that this inevitable course of action will be positive for the direct marketing industry or for the country.
In addition, late last week, H. Robert Wientzen, the DMA's president/CEO, sent a letter to the agency's Board expressing the association's concerns.
"We lack confidence in the Postal Service to provide the reasonably priced services direct marketers require in the 21st Century," said H. Robert Wientzen, president and chief executive officer, the DMA, in a letter to Einar Dyhrkopp, chairman of the USPS Board of Governors. "In fact, the request, with rates increasing at triple the rate of inflation, is not an action of a business looking toward the new century, but one looking toward certain decline."
In his letter, Wientzen said the USPS is in the midst of an unprecedented economic boom, and inflation for 1999 and 2000 is projected to be less than 5 percent. But, "sadly, the boom seems to have missed the Postal Service," he wrote
Among other issues, Wientzen mentioned that the DMA was concerned that the proposed increase for mailers who invest in worksharing for advertising mail face even higher increases of 15 percent -- triple the rate of inflation for 1999 and 2000. Thus, the Postal Service is punishing mailers who invest in efforts to improve postal productivity.
Wientzen wrote that he urged Dyhrkopp and his fellow Governors to review the request, withdraw it and guide the USPS into the 21st Century "with cost control, productivity improvement and rate increases below inflation levels. Only then will your customers' confidence return and will the Postal Service have a chance at survival."