Tuesday, February 1, 2011

Postal Rates Going up. But not for everyone. And then, not by much. Usually.

Head in the Sand!Unless you've had your head in the sand for the last decade, you know that the post office has been hemorrhaging money. Despite aggressively cutting jobs, closing facilities and taking draconian measures to staunch the flow, the loss continued in 2010, with the USPS losing $8.5 billion. (That's Billion with a "B"! dear reader.)

Desperate to reverse the trend, but hamstrung by legislation that mandates the USPS can not ask for increases in excess of inflation year over year, the USPS has proposed a very modest rate change that will increase postage 1.7% in a blended average over all mail classes. The increase, which goes into effect in April, will generate only about $340 million in 2011 to fill the deep hole that the USPS is in. But every little bit helps.

Every little bit helps!The really good news for mailers is that most will see minimal—if any—changes.

For instance, 4.25x6 postcard rates will rise by a penny, to 29 cents. First Class Presort rates for postcards will also rise, but only by fractions of a cent. And by "fractions of a cent" I mean one or two tenths of a cent.

Carrier Route saturation rates remain virtually unchanged—except for the same fraction-of-a-cent increases for DBMC deliveries, and at less dense delivery models.

Non-Profit and Standard mail will similarly remain virtually changed except in the fraction-of-a-cent category for less dense delivery models.

Periodicals—a target of recent huge rate hikes—will see only a 1.8% increase this time.

First class letters will remain at 44 cents. But for "overweight" letters, the additional ounce will go to 20 cents—one of the heftiest increases at almost 18%.

Be Grateful!Other big increases will be First-Class flats which will increase by 5.3%, and first-class parcels which will see a 3.8% increase. First-Class international mail will also increase by 4%, and some parcels will see a whopping 11.3% increase.

So here's the bottom line: while there is a postal increase in the offing, the news is hardly doom-and-gloom for most of us. We should all be grateful for small (1.7%) favors.

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