understanding the 2015 shipping & postal changes

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


•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


•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


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


• 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


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

48

Pricing Update


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


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


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

http://www.pitneybowes.com/us/postal-information/intelligent-mail/intelligent-mail-package-barcode.html




Pricing Update – Shipping Options


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


• 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


Which solution is best for you?


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:


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


First Class® Parcels – current (as of January 2015)


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


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


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


IMpb Required

Network Rationalization


Network Rationalization


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


Proposed 2015 USPS® Promotions


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


• 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


http://www.pitneybowes.com/us/postal-information.html





USPS News sources you can rely on


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





Additional Resources


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


Slideshare.net

Sending Packages in 2015

http://www.slideshare.net/pitneybowes/sending-packages-2015-the-business-

impact-of-impb-dimensional-rating-changes

https://ribbs.usps.gov/index.cfm?page=intellmailpackage







http://www.slideshare.net/pitneybowes/sending-packages-2015-the-business-impact-of-impb-dimensional-rating-changes





















Thank you
