Understanding the 2015 Shipping & Postal Changes
January 16, 2015
Presenter: Janet Lockhart-Jones
Your Presenter: Dr. Janet Lockhart-Jones joined Pitney Bowes in September 2012 to fulfill the cross-enterprise role of Curriculum Manager, Postal Education. In this capacity, Janet serves as a postal education trainer, Subject Matter Expert (SME) and consultant to Pitney Bowes and its clients. Janet’s professional career includes 20 years with the United States Postal Service and 10 years as an independent leadership development and performance consultant, all before coming to Pitney Bowes. Janet holds the degrees of Doctor of Education, Master of Science in Human Resources Management and Bachelor of Science in Business. She is the Postal Education Chair of the Sacramento Postal Customer Council (PCC), a member of MSMA National Education Committee, and a Certified Mailpiece Design Consultant (MDC) and has received certification from the Envelope Manufacturers Association as a Certified Postal Partner.
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Session Objectives
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•Understand 2015 USPS® price and regulatory changes impacting the mailing industry
•Be able to explain to others how 2015 proposed changes will affect your mailing operations
•Enable you to execute on the changes and opportunities that are available to reduce postage expenditures
•Recognize your call to action
Agenda
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•Pricing Update
•IMpb and postage meters
•Proposed change to Retail First Class® Parcels
•Network Rationalization
•Proposed 2015 Promotions
Pricing Update
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Pricing Update
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January 2015 price change • No price changes proposed for January • September 7th 2014 Priority Mail® price changes stay in place
January 2014 Exigent Rate Case Status • Still in place • PRC suggests USPS® could recoup $2.8B by August 2015 • USPS issued a court filing to make Exigent rate increase permanent….no decision yet!
Any USPS 2015 price changes on the horizon? • Yes! • Be on the lookout for information on the proposed April 16th pricing changes!
1.69% CPI + 4.30% Exigent = 5.99% overall average increase
Pricing Update
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• 4.9% across the board rate increase • Both private carriers moved to Dimensional Weight (DIM) rate pricing on all parcels
• UPS – December 29, 2014 • FedEx – January 1, 2015
Weight = 4 ounces Weight = 5, 7, or 11 lbs.?
Pricing Update
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Save 1¢ on First-Class™ letters that have postage affixed using:
•Postage Meter •PC Postage •Permit Imprint •Pre-canceled stamps No piece minimums No preparation requirement No requirement to report those pieces on a postage statement
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Pricing Update
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After 1/25/2015, due to Intelligent Mail® package barcode requirements, shipping packages just with a postage meter...
….will result in a price increase due to the loss of Commercial
Base Pricing (CBP).
Intelligent Mail® package barcode (IMpb) = parcels only
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All
parcels for the
services below are
subject to IMpb
requirements
Priority Mail ExpressTM Priority Mail® First-ClassTM Package Services Parcel Select Parcel Select Lightweight Standard Mail Library Mail Media Mail BPM
Pricing Updates
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New requirements take effect January 25, 2015. Only shipping labels that are custom-generated with the Intelligent Mail® package barcode will qualify for reduced rates (Commercial Base Pricing). Using pre-printed labels, you will pay the retail rate. IF YOU SHIP MORE THAN A FEW packages each week, these examples demonstrate how the cost difference adds up. ™
Software- generated IMpb
Pre- printed USPS® Tracking Label
Pricing Update – Shipping Options
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Option A • Custom-generated label requires a shipping solution
– label and barcode generated is specific to each mailpiece
• Uploads mailing information (Address data, Zip+4®, Class of Service, Extra Services and Mailer ID)
• Enhanced tracking and visibility • Eligible for discounted Commercial Base or
Commercial Plus Pricing
Option B • Pre-printed label - must be used with Postage
Meter Tape • Simple, easy to use • Unique barcode allows you to track each package • Pay retail rates
+
Pricing Update – IMpb solutions
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• Online shipping and mailing postage solution
• Single site, desktop or enterprise
• Multi-carrier parcel management solution
• Single site
• Web based multicarrier parcel, LTL and TL shipping management solution
• Single site, desktop or enterprise
SendSuite® Xpress
SendSuite® Live
IMpb and postage meters
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Which solution is best for you?
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Start by understanding your business needs: • Simplicity • Streamline workflow • Minimize shipment costs and compare carrier rates • Gain tracking visibility for important or urgent mail and packages • Efficiently process Extra Services like Certified Mail®
How do you send
packages? Process Change Suggestions After January 25, 2015
• Use a postage meter,
• low volume (< 6 packages/
week)
• No significant change in current process • Do not qualify for discount
incentives
• Use a postage Meter,
• mid-volume
• (6 -18 packages/ week)
• Adopt pbSmartPostage™ • Qualify for discount pricing
and incentives
• Send 19 – 20+ packages/
week
• OR use Extra Services
regularly (i.e. Certified Mail).
• Need to rate shop!
• Adopt SendSuite® solutions
• Qualify for discount
incentives,
• gain streamlined workflow
Shipping with a postage meter after 1/25/2015:
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Yes you can! If you do…..
• Retail rates will apply to all shipping services!
• A Label 400 must be affixed to each parcel package before depositing with the USPS®
• Included insurance with Priority Mail® parcels is NOT automatic
• Tracking is available.
Important: You can continue to process packages using a postage meter with very few changes to your
current process!
Proposed Change to Retail First Class® Parcels
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First Class® Parcels – current (as of January 2015)
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First-Class Mail® Parcels First-Class™ Package Service
• Classification
• Market Dominant/Mailing Services
• Competitive/Shipping services
• Delivery Standard
• 1 – 3 days • 1 – 3 days
• Maximum Weight
• 13 ounces • 13 ounces
• Rate • Retail • Commercial only – Commercial Base
or Commercial Plus
• IMpb • Label 400 acceptable for retail • IMpb required
Commercial Plus parcels may have a maximum weight of 15.999 ounces. Specific volume and payment requirements
apply.
First Class® Parcels – proposed
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Classification
• Competitive
Options
• Retail (First-Class Mail Parcel)
• Commercial (CBP or CPP)
Barcode Requirement
• IMpb (Commercial)
• Label 400 (Retail)
Weight
• Maximum: 13 ounces
• CPP: 15.999 ounces
• Delivery Standard: 1-3 days
Open or Closed
• First-Class Mail Parcels Retail will remain closed to
Postal Inspection
Pricing
• Expected to change
First Class® Package Service
First Class® Package Service – proposed
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Ounces Current Proposed
1 $ 2.32 TBD
2 $ 2.32 TBD
3 $ 2.32 TBD
4 $ 2.50 TBD
5 $ 2.68 TBD
6 $ 2.86 TBD
7 $ 3.04 TBD
8 $ 3.22 TBD
9 $ 3.40 TBD
10 $ 3.58 TBD
11 $ 3.76 TBD
12 $ 3.94 TBD
13 $ 4.12 TBD
Retail First-Class® Mail Parcels
• To comply with PES, minimum cost must be at least 6x the cost of a First Class® Stamp
• $0.49 x 6 = $2.94 Minimum
First Class® Package Service – Commercial – current
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IMpb Required
Network Rationalization
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Network Rationalization
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Current state
https://about.usps.com/news/electronic-press-kits/our-future-network/assets/pdf/ofn-phase-2-faqs.pdf
• 82 additional consolidations planned for 2015
• Expected to start in January 2015 – unless Congressional Action blocks the plan
• Overnight or next day delivery standards could change in your geography – Critical Entry Times changing to 8:00 am for overnight service
Proposed 2015 Promotions
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Proposed 2015 USPS® Promotions
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First-Class® Mail Color/Transpromo Promotion • Continue to grow the value of First-Class Mail and encourage mailers to invest in color
print technology for bills/statements Mail Drives Mobile Engagement Promotion • Demonstrate how direct mail, combined with mobile technology, continues to be a
convenient method for marketers to connect with their customers and facilitate more ways to do their shopping
2015 Earned Value Reply Mail • Slow the decline of First-Class Mail (BRM and CRM) pieces through a postage credit for
each returned mailpiece Advanced or Emerging Technologies Promotion • Encourage the use of “enhanced’ augmented reality or standard NFC technology in
mailing campaigns
All promotions are tentative and subject to PRC approval
Summary – call to action
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• Determine if moving to an IMpb-compatible solution is right for your organization
• Review your retail First Class® Mail Parcel volumes • For high volumes, consider moving to First Class® Package Service – commercial.
• Review your 2014 postal budgets
• Ensure you have allocated funds for April 2015 increases
• Prepare for additional 2015 USPS® Network Rationalization activities • mail reaching your customers could take an extra day.
• Continue to leverage Pitney Bowes educational resources to stay informed of industry changes.
USPS News sources you can rely on
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http://www.pitneybowes.com/us/postal-information.html
USPS News sources you can rely on
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http://blogs.pb.com/usps-news/
Additional Resources
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Resource Link
RIBBS –
Intelligent Mail® package barcode
https://ribbs.usps.gov/index.cfm?page=intellmailpackage
Pitney Bowes
Mail Solutions Blog
http://blogs.pb.com/mail-solutions/
PitneyBowes.com
Postal Information Rates &News
http://www.pitneybowes.com/us/postal-information.html
Slideshare.net
Sending Packages in 2015
http://www.slideshare.net/pitneybowes/sending-packages-2015-the-business-
impact-of-impb-dimensional-rating-changes
Thank you
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