Breaking News: Increased Postal Rates Take Effect in January
- November 2005

Yes, postage rate increases are back. Earlier this month, the USPS Board of Governors accepted the latest PRC rate case, which means postage rates will rise an average 5.4% effective January 8, 2006. According to the Postal Service, the rate hike was necessary to fulfill a federal mandate requiring the USPS to establish a $3.1 billion escrow fund.

This chart highlights current and new rates for a few select mail categories
All "new" rates are effective January 8, 2006:

The good news: This is the first rate increase since 2002, and turned out to be lower than the double-digit rate increases originally feared. The bad news: Another rate increase is looming. The U.S. Postal Service Board of Governors has already told the direct mail community to expect another rate increase of similar proportions in 2007. With that in mind, here are a few suggestions graphic arts companies can offer their customers as they plan upcoming direct mail campaigns:

• Avoid costly surcharges: The USPS imposes stiff surcharges for standard and first-class mail that’s nonmachinable. For example, pieces mailing at the discounted standard-mail rate will be hit with a $0.042 per-piece surcharge if they don’t conform to length, width, thickness and other automation-compatibility regulations. While $0.042 may not look like much, it tacks on another $2,100 in extra postage costs for a 50,000-piece campaign.

• Clean up your list: The USPS rewards mailers with clean lists. Perform basic list due diligence such as CASS certification and NCOA verification, the latter of which is required by the USPS within 180 days for a bulk mailing. The real discounts occur when you help offload some of the work from the USPS. For example, the rate for a one-ounce, presorted discounted first-class mailing is $0.371; the same piece will mail at $0.290 if they’re sorted by carrier route.

What Grow Sales, Inc. Can Do For You

At Grow Sales, Inc., we recognize that increased postage costs are just one business reality that printing, direct mail and other graphic arts industry companies will face in 2006. In addition to providing top-notch outbound marketing, public relations, web and graphic design and sales support services, the advisors at Grow Sales regularly function as “talking partners” for our clients as they seek solutions to industry-specific challenges and opportunities. Give us a call to learn how we can help grow your business in 2006 and beyond.

Back to E-Tips