USPS raises rates in effort to keep up with rising costs

The US Postal Service has announced several rate increases for its market-dominant products, which include First-Class Mail, Standard Mail, Periodicals, package services and special services. The increases are expected to take effect on May 12.

The USPS plans to increase prices for these products on an annual basis each May, according David Partenheimer, a USPS spokesman. “Smaller, predictable price changes will allow our business customers to better plan and budget for their mailings,” he said.

This will avoid the problems caused by the old pricing system, where several years went by without a price change and then some mailers were hit with a big increase. “We’re moving toward the industry standard. Most shipping com­panies adjust their prices every year,” Partenheimer noted.

According to the Postal Accountability and Enhancement Act, the average price increase per class can not exceed the Consumer Price Index. However, prices can vary within a class. As of January 16, the price cap for market-dominant products is 2.9%, according to the Postal Regulatory Commission. Overall, First-Class mail will increase by 2.889%, Standard Mail by 2.875%, Periodicals by 2.710%, package services by 2.876% and special services by 2.848%.

In the Standard Mail category, par­cels and non-flat machinables will see the largest percentage cost increase at 9.66%. Standard Mail letters will increase by 3.39%; flats by 0.86%; high density and saturation letters by 1.66%; high density and saturation flats and parcels by 2.09% and carrier route letters, flats and parcels by 2.99%.

Hamilton Davison, executive director of the American Catalog Mailers Asso­ciation, applauded the announcement in a statement. “It is a strong signal that the USPS recognizes the economic distress in the catalog industry,” he said. “We had a huge rate increase last year and catalogers have been struggling since.”

Although the law only requires 45 days notice, the USPS said that it will provide 90 days notice before the price changes go into effect. “Mailers can always expect an announcement around February for prices to change each year,” Partenheimer said.

Until March 3, the PRC will be accepting public comment on whether the new rates are consistent with the requirements of the law. New prices for the USPS’ competitive products, which include Express Mail and Priority Mail, will be announced in March.

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