usps price & regulatory changes -- what you need to know!
DESCRIPTION
Are you ready for the January 26th USPS Price and Regulatory Changes? The Postal Service's Mailing and Shipping prices as well as changes to mailing rules and regulations have been finalized and will be implemented on January 26. These changes directly impact your bottom-line and are important to understand. Go through this presentation to learn: • USPS mailing and shipping price changes and how to mitigate the affect and maximize your postage savings • Planning for the changes and understanding the critical timing required • Understanding Full Service IMb compliance and pricingTRANSCRIPT
Ann Daley Vice President, Government & Regulatory Affairs, Pitney Bowes Alison Hall Director of Client Services – Direct Mail Solutions, Pitney Bowes January 15, 2014
USPS® Price & Regulatory Changes – What You Need to Know!
Agenda
WHAT’S INSIDE Background
Highlights
The Details
Promotions
Intelligent Mail® Barcode
2
Mailing and Shipping Prices are Changing January 26th
1.Consumer Price Index-Urban (CPI-U) Price Proposal Average price increase of 1.7% Full Service IMb still required to get the Full Service incentives but NO
loss of automation discounts
2.Exigent or Above-the-Cap Price Proposal Approved but it’s a temporary surcharge Generally across-the-board increase of 4.3% Rolled back in less than two-years
3. Shipping Prices increasing an average of 2.4%
3
Background
1.7% CPI + 4.3% temporary surcharge = 6.0% average increase
Classes of Mail Affected
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Mailing First-Class Mail® Single-Piece Letters & Cards Presort Letters & Cards Flats Parcels Outbound Single-Piece International Standard Mail® Letters Flats Parcels High Density/Saturation Letters Every Door Direct Mail Retail Parcels
Package Services Bound Printed Matter (BPM) Flats BPM Parcels Media, Library Mail Alaska Bypass Periodicals
Special Services
Shipping Priority Express Priority Parcel Select Lightweight Parcel Select Parcel Return Service Bulk International
Shipping Services average increase of 2.4%
Priority Mail Express delivery by 10:30 a.m. for an extra $5.00
Priority Mail products qualify for free insurance up to $50 or $100
Significant discounts for commercial parcels continue Volume requirements lowered for Priority Mail Commercial Plus from
75,000 to 50,000 pieces annually Intelligent MailTM package barcode (IMpb) required– $.20 fee on
commercial parcels lacking IMpb
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Shipping Services Change Highlights
Retail First-Class Single-Piece one-ounce letter increases to .49 cents
New First-Class Mail® letter price category to be called “Metered Mail” − 1 cent less than First-Class Single-Piece
Changes to residual First-Class Mail letters price structure
The USPS® continues to price AADC and 3-Digit Letters and Cards at the same level
Second-ounce free continues for all Presort First Class Mail letters (Non-automation and Automation)
Intelligent Mail® barcode $.003 incentive maintained No loss of automation discounts
First-Class Mail® Change Highlights
6
Flat Sequencing System (FSS) preparation will be required in Destination FSS (DFSS) zones
Standard Flats − $0.001 per piece discount for pieces on DFSS-entered
scheme pallets
AADC and 3-Digit Presorted Letters will continue to be priced the same
− Presorting requirements are NOT changing
Intelligent Mail® Barcode $.001 incentive maintained
Simple Samples – No increase in the price of Simple Samples
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Standard Mail® Change Highlights 1
Customized Market Mail reduced from $.046 to $.044
New prices for EDDM – Commercial − $0.151 to $0.203, based on entry point
EDDM Retail – price increasing to 17.5 cents
Proposing to disallow use of detached address labels (DALs) with all Standard Mail flats mailed with simplified addresses (EDDM); therefore, all EDDM flats entered at BMEUs or Retail would have to bear simplified addresses directly on the flats
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Standard Mail® Change Highlights 2
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Special Services Change Highlights 1
Certificate of Mailing New Prices
Basic $1.30
Firm Book Mailing 0.47
Bulk: First 1,000 pcs 7.80
Each Add’l 1,000 pcs 0.95
5-Digit 0.451
Certified Mail $3.30
Return Receipt
Requested at time of mailing
Electronic $1.35
Green Card 2.70
Merchandise 4.40
Requested after mailing 5.25
Special Services Change Highlights 2
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USPS Tracking New Prices
First Class Mail (Parcels Only) Retail $1.05
First Class Mail (Parcels Only) Electronic 0.00
First Class Package Service Electronic 0.00
Priority Mail Retail 0.00
Priority Mail Electronic 0.00
Standard Post Retail 0.00
Standard Mail Parcels Electronic 0.23
Package Services Retail 1.05
Package Services Electronic 0.23
Parcel Select Electronic Electronic 0.00
USPS Tracking New Prices
Electronic $2.35
Retail 2.90
FSS preparation will be required for Periodicals mailed in DFF Zones
FSS pricing at the bundle level, sack level, and pallet level will be introduced at all entry points
Full-Service IMb® incentive maintained
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Periodicals Change Highlights
FSS pricing to be introduced for BPM Flats
FSS price categories introduced for presort at originating entry, DNDC entry, DSCF entry, and DFSS entry, as well as carrier route presort at originating entry, DSCF entry, and DFSS
No FSS pricing for DDU destination entry
FSS pricing incentives for BPM flats may be introduced after January 2014
Eliminates $0.03 POSTNET barcode incentive for BPM Flats
Retains $0.001 Full-Service IMb incentive for BPM Flats
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Package Services Change Highlights
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Key Details
Letters (1 oz.) $0.49
Letters additional ounces $0.21
First –Class Mail® International Global Forever Stamp (1 oz.) – $1.10 to $1.15
First Class Postcards $0.34
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First-Class Mail® Retail
Price
change
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Key First-Class Mail® Single-Piece Prices
Current
Price
New Price
Stamp Price 0.46 0.49
Meter Price 0.46 0.48
Single-Piece Flats 0.92 0.98
Single-Piece
Cards 0.33 0.34
Retail Parcels 2.07 2.32
Save 1¢ on First-Class letters that have postage affixed using: Postage Meter PC Postage Permit Imprint Pre-canceled stamps
No piece minimums No preparation requirement No requirement to report those pieces on a postage statement
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NEW: First-Class Meter Rate
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The new price category will be based on incremental weights up to 3.5 oz. Metered pieces claiming the new “Meter Price” will have postage applied
directly to the pieces, and will be deposited as “Retail mail”.
First 3 ounces in each FCM parcel category still a single price cell
$.18 additional ounce price after 3 ounces
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First-Class Mail® Retail Parcels
Oz. Current New
1 2.07 2.32
2 2.07 2.32
3 2.07 2.32
4 2.24 2.50
5 2.41 2.68
6 2.58 2.86
7 2.75 3.04
8 2.92 3.22
9 3.09 3.40
10 3.26 3.58
11 3.43 3.76
12 3.60 3.94
13 3.77 4.12
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First-Class Mail® Commercial Letters
Current
Price
New Price
Mixed AADC
Automation Letters 0.405 0.435
AADC Automation
Letters 0.384 0.406
3-D Automation
Letters 0.384 0.406
5-D Automation
Letters 0.360 0.381
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First-Class Mail® Commercial Flats
Current
Price
New Price
Machinable
Presort 0.772 0.815
Mixed AADC 0.740 0.782
AADC 0.640 0.691
3-Digit 0.594 0.634
5-Digit 0.406 0.451
0.208 each additional ounce
Mailers may continue using current preparation standards Residual 1oz and 2oz pieces presented in
the same tray receive the blended price on those pieces
NEW: Mailers have the option of separating out 1oz and 2oz pieces and paying the lower metered rate
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Commercial Residual Single-Piece
Letters: Two Options
Weight Not
Over (ounces)
CPI CPI+E
1 $0.46 $0.48
2 $0.66 $0.69
Blended $0.48 $0.50
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Key Details
Standard Mail®
Mandated Flat Sequencing System (FSS) Preparation Requirements
Flat mail going to ZIP Codes served by the FSS will require specific ways to sequence, bundle, and place mail on pallets and will be different from current methods
FSS preparation will be different when mailing at non-FSS areas
New FSS pricing Introducing FSS Facility and FSS Scheme pricing for
High Density, High Density Plus and Carrier Route Flats. $0.044 difference between Origin and DFSS Scheme
USPS to offer a $0.001 per piece discount off the DSCF price for those pieces brought to a DFSS in scheme bundles on a DFSS scheme pallet
The discount is an incentive for mailers to enter the mail at a plant where there is an FSS machine
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Standard Mail®
Flats
Sequencing
System
Simple Samples allows you to send trial-sized products to your customers No increase in price Induct mail without unnecessary outer packaging Lower prices offered for higher-volume tiers
Price reduction for Customized Market Mail from ($0.46 to $0.44)
New prices for Every Door Direct Mail (EDDM) – Commercial: EEDM Saturation Flats is $.001 less than other Saturation Flats
EDDM Retail moves to Market Dominant List – price increasing from $.16 to $.175
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Standard Mail®
Saturation and High Density Incentive
Encourage existing mailers to increase mail volume by rewarding them with a rebate on incremental mail pieces above a predetermined volume baseline Commercial Saturation Mail eligible for 20% rebate Commercial High Density Plus and High Density Mail eligible for 15%
rebate Rebate provided as a credit in the postage account in early 2015
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Standard Mail® Incentive
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Key Standard Mail® Prices
Current
Price
New Price
Letters (5-D Auto entered at Origin)
0.247 0.261
Flats (5-D Auto Flat entered at Origin)
0.362 0.386
Carrier Route (Flat entered at Origin)
0.279 0.295
High Density/Saturation
Letters (Saturation Letter entered at Origin)
0.189 0.198
High Density Saturation
Flats (Saturation Flat entered at Origin)
0.201 0.211
EDDM-Retail 0.160 0.175
Mobile Technology Promotions Encourages mailers to integrate direct mail with mobile technology using best practices in mobile marketing
Branded Color Mobile Technology Emerging Technology Featuring NFC Promotion Mail Drives Mobile Commerce Promotion
Technology Drives Relevance Leverage the value of innovative direct mail techniques that are less widely used, but have been shown to increase effectiveness of mail campaigns
Color Print in First-Class Mail Transactions Promotion Mail and Digital Personalization Promotion
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Promotions Overview
Leverage Value of First-Class Mail Intended to slow the volume decline in First-Class Mail by ensuring reply mail, transactional mail and First-Class advertising remain a relevant part of the First-Class Mail marketing mix
Premium Advertising Promotion Earned Value Promotion
New Customer Acquisition Provides an extra incentive for new customers to try direct mail EDDM Coupon Promotion
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Promotions Overview
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Promotions Details
The USPS announced December 27, 2013, Full Service Intelligent Mail® requirement for automation discounts is DEFERRED indefinitely for:
Postcards (First-Class Mail® only) Letters, and flats when mailed using: First-Class Mail® Standard Mail® Periodicals®
Flats mailed at Bound Printed Matter® prices
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Full Service IMb®
Though the requirement has been
deferred for automation prices, IMb
Full-Service mailings MUST still
comply with mailing standards, as
published April 18, 2013 Federal
Register Notice (FRN), to be eligible
for the IMb Full Service Discount.
$.003 for First-Class Mail®
$.001 for Standard Mail®;
Periodicals®, and Bound Printed
Matter®
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Full Service IMb® effective January 26, 2014
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IMb® Requirements
FULL-SERVICE
Intelligent Mail® barcode on mailpiece x
Unique serial number in barcode* x
Intelligent Mail® barcode on trays and containers x
Electronic Documentation (e-Docs) submission x
FAST® Appointment Scheduling x
*Small mailings (fewer than 10,000 pieces) can use the same serial
number for all pieces, if: • Postage is affixed to each piece at the correct price OR
• All pieces are of identical weight and separated by price
Additional information on Full-Service requirements can be found on:
http://www.pb.com/Postal-Information/Intelligent-Mail-Barcode/
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Full Service IMb
How will USPS measure quality and what are the
consequences?
• Current Verifications
• New Validations - January 26, 2014
• Ensure mailings comply with IMb Full Service requirements
as noted in FRN April 18, 2013
• Compliance needed to maintain Full Service IMb discounts
• eDoc verifications implemented
• By/For requirement will be verified in the eDoc verifications
• Postage Adjustments - July 27, 2014
• USPS plans to implement verification assessments for
additional postage for non-compliance beginning July 1.
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Full Service Verifications Today
• Automation Verification – Existing Verifications
Mailpiece preparation including dimensions, shape, weight, and flexibility
Barcode quality
Content
Presort makeup
Automation eligibility
• Existing Thresholds Apply
• Mailing Falls Below Thresholds
Returned for Rework
Additional Postage at the applicable rates in January
Examples:
o Poor Barcode quality = % of pieces at Non-Automation Rates
o Poor Presort quality = % of pieces at FCM Single Piece Rates
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Full Service Verifications Today • Full-Service Acceptance - Existing Verifications
• Documentation not submitted electronically
• Container placards are inside or covered by shrink-wrap
• No Intelligent Mail container barcodes on the container placards oInitial Sample = 1 Container
oIf in error, select additional 3 containers
oMore than 2 total errors = Failure
• No Intelligent Mail tray barcodes on the tray/sack labels oInitial Sample = 3 Handling Units
oIf one or more in error, select additional 3 Handling Units
oMore than 3 total errors = Failure
• No Intelligent Mail tray barcode on the mailpieces oInitial Sample = 30 Mailpieces
o4 or more in error = Failure
• Mailing Falls Below Thresholds oReturned for Re-work
oAdditional postage at the non-automated rates in January
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• Full-Service Electronic Verification - New Verifications
• Validation of the Information contained in eDoc
• Data is aggregated over a one-month period
• Displayed in the Mailer Scorecard by CRID
• Develop reasonable thresholds
• Within 48 hours after the eDoc is processed the following
occurs:
• Full-Service eDoc verification
• Check every container, handling unit and piece in electronic
documentation and evaluate for specific errors
• Trend results are monitored for at least one month
Full Service New Validations –
January 26, 2014
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Full Service New Validations - January 26, 2014 • All validations are performed by checking against values provided in the eDoc
Validation What is it?
Mailer ID Mailer ID provided in the IMb, IMtb, or IMcb is valid and registered with the USPS Mailer ID system
Service Type ID Service Type ID provided in the IMb is valid, appropriate for the class of mail, and appropriate for the service level of the mailpiece
By/For Mail Owner and Mail Preparer are provided for each mailpiece
Unique Container Barcode
IMcb is unique across all mailings from all eDoc submitters for the past 45 days
Unique Tray Barcode
IMtb is unique across all mailings from all eDoc submitters for the past 45 days
Unique Piece IMb is unique across all mailings from all eDoc submitters for the past 45 days
Co-Palletization Co-palletization files are submitted within 14 days for trays/virtual sacks marked for co-palletization at origin
Entry Facility Entry facility provided in eDoc (Locale key or ZIP Code) is a valid USPS facility
Scheduled Ship Date
For USPS Transported containers that do not receive scan at arrival to USPS facility, scheduled ship date/time is within 48 hours of finalization date/time.
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The Mailer Scorecard
• The Mailer Scorecard provides a dashboard view summarizing
performance
• Allows comparison across facilities
• Conditional formatting provides a trending view across months
• Drill reports provide a way to determine specific mail preparation
errors
• Available for any company that submits electronic documentation
• Data grouped by eDoc submitter CRID
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Mailer Scorecard User’s Guide - https://ribbs.usps.gov
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Full Service Mailer Scorecard (Available today)
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Full Service Thresholds
• USPS will establish and publish thresholds during the first
six months of 2014 based on a statistical analysis of
actual mailer quality.
• Example thresholds can be found in the scorecard
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Full Service Postage Adjustments –
July 27, 2014
• eDoc evaluation based on monthly average
• Not individual mailings
• Postage adjustments occur if a particular error is over the
threshold
• Number of pieces in error times the difference between postage
affixed and the presort rate
• Example: 10,000 piece mailing with 11% error while
threshold is 10% and postage claimed is $.36.
• 1,100 pieces in error X (.433-.36) = $80.30 Additional postage
due
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Full Service Postage Adjustments - July 27, 2014
Invoice Generation Timeline
• All postage assessments will be performed at the eDoc Submitter CRID level
• Mailers will have 10 days to review the invoice and all mail preparation errors:
During this period of time, mailers can elect to dispute errors
If contested, invoice will be placed in a dispute queue report made available
externally
End of Invoicing
Period
(Month End) Invoice
Generation
10 Days
Pay/Dispute
Invoice
VAE Verification
Assessment Evaluator
10 Days
Update/Reject/
Close Dispute
BMS Reviewer
5 Days
Pay Invoice
VAE
3 Days
If unpaid, invoice will be
marked as overdue
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Full Service Intelligent Mail Resources
• Intelligent Mail Services
Email: [email protected]
Web: https://ribbs.usps.gov
Phone: 800-522-9085
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https://ribbs.usps.gov
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Full-Service Intelligent Mail® Webinar Series
https://ribbs.usps.gov/index.cfm?page=intellmailpresentations
Intelligent Mail Package Barcode (IMpb) is required January 27, 2014 Required to continue to claim presort or destination entry prices, except
Standard Mail. Required for tracking and Extra Services barcodes, and all First-Class
Package Services, Parcel Select, Parcel Select Light Weight, Bound Printed Matter, Media Mail and Library Mail parcels. * Required for end to end tracking including confirmation of delivery at no
charge. *
*Track packages through the Product Tracking System. See https:\\ribbs.usps.gov for more details.
Full Service IMpb Requirements January 27, 2014
Although temporary, the price increase is 6%
My budget is already set for 2014!
Are there any options to reduce my costs?
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Options to Mitigate Postage Increase
• NEW! Metered Mail Rate saves $.01
•Use Meters or pbSmartPostageTM instead of stamps for small offices and departmental mail
• Commercial Base Pricing offers discounts for Priority Mail®, Priority Mail Express™ or First-Class™ Package Service
• USPS Flat Rate offer one rate no matter the weight or where the package is shipping
• Choose Parcel Select over Standard Post
pbSmartPostageTM , or other PC
postage options, can save $$
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Options to Mitigate Postage Increase
• Mail piece Design captures savings!
•Make sure mail piece is automation compatible for best postage save
•Fold flat size mail contents in half to 6x9 envelope to qualify for letter size postage price . Save 50% or more
•Save at least 30% using Postcards
• Consider Standard Mail for non personal mailings for savings over $.10 per piece
• Cleanse Database for address accuracy and move updates
•See your local PB rep for more information
• Postage Optimization for additional mail streams
•See your local PBPS facility contacts for postage analysis today
*postage save estimated with single piece rates
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Options to Mitigate Postage Increase
Ann Daley Vice President, Government & Regulatory Affairs, Pitney Bowes [email protected]
Alison Hall Director of Client Services, Direct Mail Solutions, Pitney Bowes [email protected]
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Questions?
THANK YOU.
For More Information:
http://www.pb.com/postal-information