The Future of The Future of Presort Presort

MSMA MSMA August 15,2007August 15,2007

Alison HallAlison Hall Dennis ShultsDennis ShultsGeneral ManagerGeneral Manager Owner Owner Pitney Bowes PSI Presort Services Pitney Bowes PSI Presort Services KC KC Presort Presort

What is Presort Anyway? What is Presort Anyway? • PresortPresort – To sort mail according to Zip Codes – To sort mail according to Zip Codes

before delivering to the Post Office.before delivering to the Post Office.– The process by which a mailer prepares mail so The process by which a mailer prepares mail so

that it is sorted to the finest extent required by the that it is sorted to the finest extent required by the standards for the rate claimed. Generally, presort standards for the rate claimed. Generally, presort is performed sequentially, from the lowest (finest) is performed sequentially, from the lowest (finest) level to the highest level, to those destinations level to the highest level, to those destinations specified by standard and is completed at each specified by standard and is completed at each level before the next level is prepared. Not all level before the next level is prepared. Not all presort levels are applicable to all mailings. presort levels are applicable to all mailings. -Business Mailers 101 -Business Mailers 101

• Presort MailerPresort Mailer – A mailer that presorts or – A mailer that presorts or has their mail presorted. They earn a has their mail presorted. They earn a worksharing discount that reflects the worksharing discount that reflects the reduced cost of processing to the USPS. reduced cost of processing to the USPS. -National Association of Presort Mailers-National Association of Presort Mailers

Different forms of Different forms of Presort Presort

• Presort Presort

• Manifest Manifest

• Commingling Commingling (MLOCR)(MLOCR)

Automation Presort Automation Presort

• Reclassification 1996Reclassification 1996

• USPS wants partnersUSPS wants partners

• Mutually Beneficial Mutually Beneficial

Presort Today Presort Today

• Transformation Plan 2006-2010Transformation Plan 2006-2010

• Shape Based RatesShape Based Rates

• Clean Addresses – DPV Cass Cycle LClean Addresses – DPV Cass Cycle L

• The Postal Accountability and The Postal Accountability and Enhancement Act, Dec 22, 2006Enhancement Act, Dec 22, 2006

Presort in the Future Presort in the Future

• Annual Rate Changes Annual Rate Changes

• FSS FSS

• Intelligent Mail BarcodeIntelligent Mail Barcode

• Seamless Acceptance Seamless Acceptance

FSS – Flats Sequencing FSS – Flats Sequencing SystemSystem

• Battle between Delivery Point Battle between Delivery Point Packaging and FSS has been decidedPackaging and FSS has been decided

• Letters and Flats sorted separatelyLetters and Flats sorted separately– DP sequence sorting for letters continuesDP sequence sorting for letters continues– Flats to also be sequenced to Delivery Flats to also be sequenced to Delivery

PointsPoints– Non-automated mail will continue to be Non-automated mail will continue to be

hand casedhand cased

• Future rate cases should incentivise Future rate cases should incentivise Flat sorting to deeper levelsFlat sorting to deeper levels

Intelligent Mail Barcode Intelligent Mail Barcode

Intelligent Mail BarcodeIntelligent Mail Barcode

Benefits of IM BarcodeBenefits of IM Barcode

• Combines Postnet, Planet, and special Combines Postnet, Planet, and special services into a single codeservices into a single code

• Leaves more available mailpiece “real Leaves more available mailpiece “real estate”estate”

• More overall data capacity More overall data capacity • Relates services back to 1 unique Relates services back to 1 unique

customer ID customer ID • Allows for uniquely identifiable Allows for uniquely identifiable

mailpieces.mailpieces.

Letters and Flats - Old World to Letters and Flats - Old World to New WorldNew World

FROM THIS

TO THIS

Presort in the Future Presort in the Future

• Annual Rate Annual Rate Changes Changes

• FSS FSS

• Intelligent Mail Intelligent Mail BarcodeBarcode

• Seamless Seamless Acceptance Acceptance

Seamless AcceptanceSeamless Acceptance

VISION VISION

Provide Provide end-to-end visibilityend-to-end visibility and a and a seamless processseamless process for mail acceptance for mail acceptance

and delivery, using and delivery, using standardized standardized intelligent barcodesintelligent barcodes, continuous , continuous mail mail trackingtracking, and , and mail quality feedback in mail quality feedback in real-timereal-time, to position Letters and Flats , to position Letters and Flats

as a as a Key Communication Medium. Key Communication Medium.

-USPS-USPS

Seamless AcceptanceSeamless AcceptanceIntegrated ApproachIntegrated Approach

Payment

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ElectronicCollaboration

Questions?Questions?