WHAT CAN BUSINESS MAILERS expect this year? In a nutshell, a dollop of uncertainty and a heaping helping of change.
On Jan. 8, postage rates rose 5.4%. By midyear the U.S. Postal Service will ask for yet another rate hike for 2007. While USPS officials have discussed keeping that increase in the single-digit range, they’ve all but conceded that the percentage will exceed inflation.
It’ll be the first time in several years that the USPS and the Postal Rate Commission have dealt with a rate case requiring a detailed examination of all postal products’ cost/price relationships. And it’s been quite a while since the postal service proposed any significant structural changes to the mail classification schedule. Many of these changes are expected in the upcoming request.
This will be the first rate case in which the postal service will have to square away associations with key sectors of its core business. First class mail volume is likely to decline relative to standard mail’s growth. Does this mean standard mail will rise at a rate greater than inflation? It’s anyone’s guess.
Despite the USPS’ former affirmations about doing network realignment “below the radar screen,” press reports have been abuzz with announcements of facility reviews by the postal service. Facility consolidations probably will move briskly, and some will affect how mail is prepared and entered into the system.
This year the USPS also is expected to accelerate its implementation of the flats sequence sorting program. Count on it to alter some of the rules regarding preparation of automation-compatible flats and barcode placement.
And what about postal reform? Exactly! What about it? Chances are that H.R. 22 and S. 662 are dead in this Congress. If this is true, will any lawmaker attempt to pass a postal bill that’s less comprehensive (and controversial) as past efforts have been? If no one does, the outlook for future postal rates won’t be rosy.
For sure, this is not a time for mail-related businesses to slumber. It’s time to get involved and stay informed.
GENE A. DEL POLITO is president of the Association for Postal Commerce (PostCom) in Arlington, VA.
Network
