Mailers, Software Vendors Prepared for July 1 Increase

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Though they are not looking forward to it, most mailers and mailing houses are ready for the U.S. Postal Service rate increase July 1.


"We will be beta testing our software within the organization to make sure all the proper rates are implemented into our software," said Rick Hall, director of postal affairs at Cox Target Media, Largo, FL, mailers of the Val-Pak product. "By July 1, we will have an implementation."


Hall said that though the software programming for the increase was not difficult, he is still concerned that it had to be done.


"We are concerned about the ways the postal service handled their business as far as enforcing the additional rate increase beyond the rate increase that went into effect on Jan. 7," he said.


Postal rates rose an average of 4.6 percent Jan. 7. Then, on May 7, the USPS Board of Governors announced that rates would rise July 1 across the board by an average of 1.6 percent.


The cost of each Val-Pak product will rise 0.2 cents because of the latest rate increase, Hall said.


"It always costs you more money when you have to go back in with your [information systems] people to make necessary adjustments," he said. "It's time-consuming to have to go into programs and then change the rates."


Mailing services companies also are ready to handle their clients' mail July 1.


"All our customers will be prepared on July 1," said Brian Euclide, manager of list management services and technology at Perry Judd's Inc., Waterloo, WI, a provider of printing, list services and distribution to publishers and direct marketers. Many of his customers will "be doing more mailings this week, instead of next week, to take advantage of the less-expensive rates."


Most postal presort software vendors, such as Firstlogic Inc., La Crosse, WI; Group 1, Lanham, MD; and Pitney Bowes, Stamford, CT, have been prepared for the change for a while. Vendors said this change was not difficult to incorporate into the software because there were no major mail make-up changes. Only rates and mailing statements needed to be changed.


Nevertheless, Firstlogic has been shipping the latest version of its mail-preparation software suite for several weeks.


"This new postal rate increase just compounds the compliance challenges being imposed on vendors and mailers alike," said Christopher Lien, Firstlogic's senior postal product manager.


Group 1 is also prepared.


"We built our presort software Mailstream Plus with the ability to download the rates, so as soon as they were announced in May, our customers were able to download the rates," said Victor Forman, vice president of postal affairs at Group 1.


The new rates are expected to generate more than $900 million in additional revenue for the postal service.


Rates for regular Standard mailers will rise 1.4 percent; enhanced carrier route Standard Mail, 1.3 percent; regular nonprofit, 2.5 percent; and nonprofit ECR, 2 percent. Regular periodical rates will increase 2.6 percent; nonprofit periodicals, 2.4 percent; Priority Mail rates, 0.9 percent; and package services, 1.6 percent.


First-Class mail will increase 1.5 percent on average. Though rates for a 1-ounce First-Class letter will stay at 34 cents, an additional ounce will increase from 21 cents to 23 cents. Postcards will increase a penny, to 21 cents, the first increase in the postcard rate since 1995.


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