January 29, 2014

January 2014 USPS® Price and

Regulatory Changes for Mailing and

Shipping Services

January 29, 2014

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 15+ years

with the United States Postal Service and 10

years as an independent leadership

development and learning consultant servicing

the hi-tech industry.

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, and is a Certified

Mailpiece Design Consultant (MDC).

Your presenter

January 29, 2014

Session Objectives

Understand 2014 USPS® price

and regulatory changes impacting

the mailing industry

Walk-away from the session with

greater clarity on how the 2014

proposed changes will affect your

mailing operations

Understand the changes and

opportunities that are available to

reduce postage expenditures

January 29, 2014

Agenda

WHAT’S INSIDE Highlights, details, and

cost saving strategies for:

First-Class Mail®

Special Services

Shipping/Competitive

products

Pitney Bowes Resources

January 29, 2014

Classes of Mail Affected – Market Dominant

First-Class Mail®

Single-Piece Letters & Cards

Presort Letters & Cards

Flats

Parcels

Outbound Single-Piece

International

Periodicals

Special Services

Standard Mail® Letters Flats Parcels High Density/Saturation Letters Every Door Direct Mail Retail Parcels

Package Services Bound Printed Matter (BPM) Flats BPM Parcels Media, Library Mail Alaska Bypass

January 29, 2014

Proposed Market Dominant Price Adjustments 1. Consumer Price Index-Urban (CPI-U) Price Proposal (Approved

w/Full-Service IMb™ Exception)

Average price increase of 1.69%

2. Exigent or Above-the-Cap Price Proposal (Approved)

Average price increase of 4.30%

Proposed Shipping Services/Competitive Products

Price Adjustment) (Approved)

Overall price increase is 2.4%

Background

1.69% CPI + 4.30% Exigent = 5.99% overall average increase

January 29, 2014

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

NEW: First-Class Meter Rate

The new price category will be based on incremental weights up to 3.5 oz. Metered pieces claiming the new “Meter Price” will have postage applied

directly to the pieces, and will be deposited as “Retail mail”.

49 48

January 29, 2014

Retail First-Class Single-Piece one-ounce letter

increase

− From $0.46 to $0.49 cents

− Metered FC letters $0.48

Changes to residual First-Class Mail letters price

structure

The USPS® continues to price AADC and 3-Digit

Letters and Cards at the same level

Second-ounce free continues for all Presort First

Class Mail letters (Non-automation and

Automation)

Full-Service Intelligent Mail® barcode $.003

incentive maintained

Full-Service Intelligent Mail mandate – not

approved; delayed until after 2014

First-Class Mail® Change Highlights

January 29, 2014

Special Services Change Highlights 1

Certificate of Mailing January 26, 2014

Basic $1.30

Firm Book Mailing 0.47

Bulk: First 1,000 pcs 7.80

Each Add’l 1,000 pcs 0.95

Certified Mail $3.30

Return Receipt

Requested at time of mailing

Electronic $1.35

Green Card 2.70

Merchandise 4.40

Requested after mailing 5.25

January 29, 2014

Special Services Change Highlights 2

USPS Tracking January 26th, 2014

First Class Mail (Parcels Only) Retail $1.05

First Class Mail (Parcels Only) Electronic 0.00

First Class Package Service Electronic 0.00

Priority Mail Retail 0.00

Priority Mail Electronic 0.00

Standard Post Retail 0.00

Standard Mail Parcels Electronic 0.23

Package Services Retail 1.05

Package Services Electronic 0.23

Parcel Select Electronic Electronic 0.00

Signature Confirmation January 26, 2014

Electronic $2.35

Retail 2.90

January 29, 2014

Key Details

January 29, 2014

Letters (1 oz.) $0.46 to $0.49

$0.48 New Metered Rate

Letters additional

ounces $0.21

First –Class Mail®

International Global

Forever Stamp (1 oz.) –

$1.10 to $1.15

First Class Postcards $0.33 to $0.34

First-Class Mail® Retail

Price

change

January 29, 2014

Key First-Class Mail® Single-Piece Prices

Current

Price

January 26, 2014

Stamp Price 0.46 0.49

Metered Price 0.46 0.48

Single-Piece Flats 0.92 0.98

Single-Piece Cards 0.33 0.34

Retail Parcels 2.07 2.32

*all prices one ounce

January 29, 2014

January 29, 2014

First 3 ounces in each FCM

parcel category still a

single price cell

$.18 additional ounce

price after 3 ounces

First-Class Mail® Retail Parcels

Oz. Current 26-Jan

1 2.07 2.32

2 2.07 2.32

3 2.07 2.32

4 2.24 2.50

5 2.41 2.68

6 2.58 2.86

7 2.75 3.04

8 2.92 3.22

9 3.09 3.40

10 3.26 3.58

11 3.43 3.76

12 3.60 3.94

13 3.77 4.12

January 29, 2014

Mailers may continue using

current preparation standards Residual 1oz and 2oz pieces

presented in the same tray receive the

blended price on those pieces

NEW: Mailers have the option of

separating out 1oz and 2oz pieces

and paying the lower metered rate

Commercial Residual Single-Piece Letters:

Two Options

Weight Not

Over (ounces)

26-Jan

1 $0.48

2 $0.69

Blended $0.50

January 29, 2014

Beginning in January 2014, the USPS® is requiring mailers

receiving automation discounts to

be Full-Service IMb™ compliant.

Full Service Intelligent Mail® was

proposed to REQUIRED for:

Postcards (First-Class Mail®

only)

Letters, and flats when mailed

using:

First-Class Mail®

Standard Mail®

Periodicals®

Flats mailed at Bound Printed

Matter® prices

IMb® Full- Service Mandate

January 29, 2014

It's not going away

Leverage the $$$ already spent

Save $$$ - reduce your mailing costs

Use the barcode intelligence to make

information-based business decisions

Enhanced Visibility

Free Address Change Service

Take advantage of cost-saving

promotions – all require Full-Service

IMb™ participation

“Why should I still move forward with Full-

Service IMb™?”

January 29, 2014

Agenda

WHAT’S INSIDE Highlights, details, and

cost saving strategies for:

First-Class Mail®

Special Services

Shipping/Competitive

products

Pitney Bowes Resources

January 29, 2014

Shipping Services - Classes of Mail Affected

Priority Mail Express™ Priority Mail® First-Class Package Service™ Parcel Select® Standard Post™ Extra Services Return Services Mailer Services Recipient Services

January 29, 2014

Competitive Services Average increases

Product Average

Increase

Priority Mail Express™ 3.0%

Priority Mail® Net 0%

First Class Package Service™ 5.0%

Parcel Select® 9.2%

Standard Post™ 5.2%

January 29, 2014

• Priority Mail® - Average net ZERO price increase in Retail and CBP

• New Priority Mail Express™ 10:30 a.m. delivery time option for an

additional $5.00

• New Flat Rate Commercial Base and Commercial Plus prices for

Priority Mail Express International and Priority Mail International

• Intelligent Mail® package barcode required on all commercial

parcels

• A fee of $0.20 assessed on commercial parcels without an

Intelligent Mail Package Barcode (IM®pb) when the targeted

thresholds have been exceeded.

• Meter customers are exempt from the 20-cent surcharge

• Meter customers must adopt an IMpb compliant solution by January

2015 or lose Commercial Base Pricing (CBP)

• New labels forthcoming for meter customers.

Shipping Services Change Highlights

January 29, 2014

Key Details

Shipping Services

January 29, 2014

Overall average price increase of 3%

Retail Flat Rate Envelope, Legal Flat Rate Envelope, and Padded Flat Rate

Envelope is increasing from $19.95 to $19.99.

Flat Rate Box price is increasing from $39.95 to $44.95.

Eliminate 12:00 Noon delivery for items Post Office to Addressee or to PO

Box; 3:00 PM is now the default delivery time.

Optional 10:30 am delivery for a fee of $5.00 ( but not available between all

origin-destination ZIP codes)

Priority Mail Express “Hold for Pickup” available by 10:30 for no additional

charge

Priority Mail Express™

January 29, 2014

Overall average net zero (0%) price increase.

Many Priority Mail Flat Rates are NOT changing.

Exception: Large Flat Rate Box is increasing from

$16.85 to $17.45.

Commercial Plus and Commercial Plus Cubic volume

thresholds being lowered to 50,000 pcs

Free USPS Tracking and $50 insurance continues with

Retail or IMpb compliant barcode. Up to $100 of

insurance for Commercial Plus

Priority Mail®

January 29, 2014

Required on ALL Commercial Parcels/Packages

$0.20 per piece surcharge for pieces failing to meet the January 26 th

standards for IM®pb use and falling outside established thresholds.

Meter customers are EXEMPT from the surcharge; they have until January

2015 to adopt an IM®pb compliant solution. After this date, retail prices

apply.

Label 400 (existing) or IM®pb complaint

barcode, or new USPS supplied labels will be accepted

from meter customers throughout 2014 and are required for

Commercial Base Pricing (CBP).

A new label is forthcoming for meter customers to use with Priority

Mail®

pbSmartPostage™ and SendSuite Live™ are IM®pb enabling

solutions

Intelligent Mail Package Barcode (IM®pb)

January 29, 2014

Exclusions

Parcels paid at retail price and inducted through a retail transaction

Periodicals parcels

Standard Mail® Marketing parcels sent as product samples that bear a simplified

address or those using a detached address label (DAL)

Priority Mail® letters and flats using stamps for postage payment and mailpieces

using Priority Mail Forever Prepaid Flat Rate packaging.

Priority Mail letters and flats prepared in a high-speed environment may, upon

authorization, use an Intelligent Mail barcode (IMb™) in lieu of an IMpb provided

each of these pieces bear a unique IMb that cannot be reused for 45 days, and

are supported by Mail.dat or Mail.XML.

Intelligent Mail Package Barcode (IM®pb)

January 29, 2014

Intelligent Mail Package Barcode (IM®pb)

Surcharge example:

January 29, 2014

CPI price proposal for Market Dominant Products

The new Meter Rate category will afford meter customers a one-cent

discount off First-Class stamped letters.

Shipping Services/Competitive Products proposal filed.

Exigent Price Proposal

Full-Service Intelligent Mail mandate for letters and flats was not approved

Intelligent Mail® package barcode required for all commercial parcels

Cost saving alternatives are plentiful

Summary

January 29, 2014

USPS® news sources you can rely on

pe.usps.com

January 29, 2014

http://www.pb.com/

USPS® news sources you can rely on

January 29, 2014

http://www.pb.com/postal-information/

USPS® news sources you can rely on

January 29, 2014

http://blogs.pb.com/usps-news/

USPS® news sources you can rely on

January 29, 2014

THANK YOU. THANK YOU.

We appreciate you!

We appreciate your business!