Strategy Prepare For the Postal Hike
Although the blended rate increase of these subclasses is approximately 14 percent, the USPS is offering discounts or incentives that could impact the large increases. Today, for example, the discount to send a catalog to a bulk mail center is $22/M and to a sectional center facility is $27/M. Under the new rate plan, the discount to mail to a bulk mail center is expected to increase to $28/M, and to $34/M to a sectional center facility. This makes the effective rate increase for a carrier route catalog 11 percent and 12 percent for catalogs mailing at the three-/five-digit level.
So, what can you do? Consider these ideas:
Look for co-mailing opportunities from your printer. Co-mailing is the process of combining different catalog titles into one mailstream to generate more carrier route discount mail. There's going to be more pressure on printers to do this. A printer's ability to co-mail and distribute catalogs is as important as its ability to put ink on paper. The advantages:
Postal savings. This is due to better presort levels and possibly better drop-ship discounts. More mail will qualify at the carrier route level.
Better deliverability. More carrier route or five-digit pallets will enable catalogs to penetrate the postal system deeper, which could generate additional savings by going to more sectional center facilities. This will increase production flow through the postal system.
Test, test, test. This includes testing lighter-weight papers and using a self-cover vs. a heavier separate cover. A move to a slightly lighter basis weight paper should have no impact on results. Paper is sold by the pound, and if you use fewer pounds, you may save money. You'll save money on postage using lighter-weight paper for sure, provided your catalog mails at the pound rate. A simple change from a 34 lb, No. 5 basis weight to a 32 lb, No. 5 basis weight will save approximately $13,000 in postage mailing 1 million 80-page catalogs (at today's postage rates). (Refer to the chart "Paper Test: 34 lb vs. 32 lb" for the results from our recent test.)