Key Notes Vol. 02 No. 01

Postal Service Ramps Up Address Quality Monitoring – The USPS is introducing an address quality tool that uses new technology to analyze all pieces in a mailing instead of just a sample, as is currently performed in the Move Update system. Users of Intelligent Mail barcodes (IMb) will be able to access the new Address Quality Measurement Tool for post mailing reporting. Failure to correct address errors could result in penalty fees for mailings in which returned pieces exceed a set threshold. Results of mailing analyses performed by the new tool will be displayed in the “Mailer Scorecard” on the electronic verification tab on the USPS’s Business Customer Gateway site. During a testing period of the system, the threshold for the assessment of fees will be set at 0.8%. That is, if 100 pieces in a 10,000-piece mailing are found in error, then 0.2%, or 20 pieces, would be assessed the fee. The fee has not been determined. Source: Direct Marketing News

When will Next Postage Hike Happen? – As mailers look into 2015 they are asking themselves — When will my postage rates increase (or decrease)? Joe Schick, Vice President of Postal Affairs at Quad Graphics, provided some insight on his company blog page. His best projection is to prepare for a possible 2% hike in late April which coincides with a scheduled vendor USPS software update. Besides the CPI increase, Mr. Schick also feels that Flat-Size mailers might see a slightly higher increase (2.5 to 3%) increase due to a lack of cost coverage recently announced in the USPS Annual Compliance report. Joe is quick to point out the possible appeal of the exigent hike (4.3%) implemented last year hangs in the balance. If the exigent is rolled back, which could be as early as June or July 2015, it might leave open the possibility of a reduction in postage at that time. [Editors Note: Any official USPS postage related announcements will be published as soon as they become available].

Package Rate Hike May Trigger FedEx, UPS Migration – FedEx and UPS may see more of their customers shipping through the U.S. Postal Service after both companies hike their rates and introduce dimensional charging, Morgan Brennan says in a report on CNBC. According to Brennan, now that the holidays are over, FedEx has followed UPS’s lead and increased rates by 5%. UPS recently increased its rates by 4.9%. Furthermore, both companies have introduced new ways of calculating the charge for a shipment (dimensional pricing). Click here to view an excellent Postal Service explanation of dimensional pricing. Source: Insider Monkey

Magazines boomed during 2014 It was a banner year for magazines — at least in terms of new titles jumping into the market. Professor Samir Husni, the director of the Magazine Innovation Center at the University of Mississippi, counted 234 magazine launches in 2014 — up 21 percent from the 185 launched a year earlier. One noticeable trend was the move by pure digital companies to roll out traditional print magazines. The trend follows companies like Politico, DuJour and All Recipes, digital products all that launched print titles in 2013. Source: New York Post

USPS Still Struggling to Meet Costs of Monopoly Services – The loss-making US Postal Service is still failing to recover its costs from operating various monopoly mail services. In particular, troublesome services like Standard Mail Flats have actually seen their cost coverage worsen despite regulatory requests and orders issued in past years requiring USPS to improve them. The Postal Service revealed its latest performance figures within this year’s annual compliance report [Link]. Under law the Postal Service is supposed to cover its costs in providing monopoly services so that customers using one kind of service are not subsidizing customers using a loss-making service. Standard Mail Flats has seen its cost coverage decrease 3.3 % in the latest financial year. It now covers only 81.6% of costs. Periodicals are at 76.1% cost coverage. Source: Post & Parcel

PMG Bids Farewell to Press – Postmaster General Patrick R. Donahoe was the featured speaker at the January 6, 2015 National Press Club Newsmakers news conference in Washington, DC. Speaking to reporters collectively for the last time prior to his retirement, Donahoe praised postal employees for their hard-work and accomplishments and also offered postal stakeholders some unsolicited advice for a profitable future. Donahoe said, “Congress needs to look at the Postal Service as a business that is going to be a lot different in the coming years and it should view this as a positive, desirable outcome.” He said the service could be profitable if it changes its business model and cited its experiments with same-day delivery of packages and grocery deliveries as forward-looking tactics. Click here to read the PMG’s entire speech. Source: USPS