The U.S. Postal Service could be authorized by its Board of Governors as early as Tuesday to begin a two-year experimental discount program for high-volume Priority Mail users.
Catalogers who use Priority Mail to ship customer orders are expected to be the chief beneficiaries of the program, which the Postal Rate Commission (PRC) endorsed last week.
When the program starts later this year, high-volume Priority Mail users providing the USPS at least 300 pieces or 500 pounds of mail and pay an annual presort fee of $125, would be eligible for one of three per-piece discounts.
The discounts for mail that meets existing USPS preparation requirements including those relating to container capacity, are: 12 cents per piece for high-volume Priority Mail entering the mail stream at an Area Distribution Center (ADC); 16 cents for each piece of Priority Mail presorted by 3-digit ZIP code; and 25 cents for each piece presorted by 5 digit ZIP code.
While USPS estimates Priority Mail volume will increase by nearly 300,000 pieces during the life of the experiment, it predicts that net revenue from Priority Mail, which totaled $4.8 billion last year, will actually decline by $2 million. Last year Priority Mail totaled 1.2 million pieces.
During the experiment, postal officials will keep tabs on volume, including shape and size of mail, the revenue derived from it as well as shifts from existing mail categories and competitors.
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