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Posted Tuesday, April 10, 2007
Washington, DC - The Postal Service Governors approved an increase in the price of a First-Class stamp to 41 cents, authorized the issuance of the Forever Stamp, approved shape-based pricing and set a May 14 implementation date for these changes. However, they delayed implementation of periodicals and requested reconsideration for some mail classes.
“We praise the PRC for its early and thoughtful recommended decision,” said Board of Governors Chairman James C. Miller III, “and appreciate the comprehensive analysis the Postal Service staff provided in its rate proposal.”
The Governors approved the Forever Stamp, which will sell at the new 41-cent First-Class Mail one-ounce letter rate. The value on these stamps will always be the one-ounce letter rate and can be used for any future one-ounce letter mailing without extra postage.
The stamp, which carries an image of the Liberty Bell, will sell for 41 cents and will remain valid for first-class postage regardless of future rate increases.
The stamps will be sold in booklets of 20 and postal officials said there is no limit on purchases.
When postal rates go up in the future, the cost for the forever stamp will also rise, but old ones will still be valid for mailing a letter.
“The Forever Stamp is a consumer innovation that delivers convenience and value and will help ease the transition for mailing letters when prices change,” said Chairman Miller.
The new prices also reflect differences in the costs of handling letters, large envelopes (flats), and packages. Instead of using an item’s weight as the primary factor to establish shipping costs, a size, thickness and weight combination will now become the standard. Essentially, mail items that are easier for the USPS to process will be rated lower than items that are not. Because of their shape differences, letters, flats and parcels will now all be priced differently because each is handled and processed differently. The proposed Shape-Based Pricing structure will significantly increase postage costs for various types of mailing applications. It also means there are going to be changes to how mail is processed.
Shape-Based Pricing is a form of dimensional weight. It promotes the use of easily sorted postal flats as well as high-density packages. On the other hand, it penalizes shippers of larger, lightweight packages.
The effects of Shape-Based Pricing will impact all mailers to one degree or another. Just how much will be determined by the type and volume of mail pieces sent. Small volume mailers will need to manually measure the size and thickness of their letters and flats to ensure proper postage is applied. Mid- to high-volume mailers will need to utilize some form of automation to help apply proper postage and keep the mail stream efficiently flowing. The bottom line is that all mailers will now need to be conscious of the size, thickness and weight of their mail pieces if they expect to save money and maintain productivity under the new structure.
Mailers are encouraged to consider options available to reduce postage costs. For example, if the contents of a First-Class large envelope are folded and placed in a letter-sized envelope, mailers can reduce postage by as much as 39 cents per piece.
Request for reconsideration
The Governors, however, requested reconsideration of the PRC’s rate recommendations for Standard Mail flats (catalogs), the non-machinable surcharge for First-Class Mail letters and the Priority Mail Flat-Rate Box.
When the rates become effective May 14, 2007, you will see:
The USPS is looking to better align postal rates with the actual costs to process and deliver mail on a piece-by-piece basis. In basic terms, you will be given incentives to:
Single-piece Letter – First ounce
Single-piece Flat – First ounce
Single-piece Parcel – First ounce
Each additional ounce
Presorted Letter – First ounce
Presorted Flat – First ounce
Automation Letter – 5-digit – First ounce
Automation Flat – 5-digit – First ounce
SELECT RATES FOR STANDARD MAIL®
Letter up to 3.3 ounces – AADC (Nonautomation)
Flat up to 3.3 ounces – ADC (Nonautomation)*
Letter up to 3.3 ounces – 5-digit (Automation)
Flat up to 3.3 ounces – 5-digit (Automation)
BMC Destination Entry Discount (Piece Rate)
SCF Destination Entry Discount (Piece Rate)
SELECT RATES FOR PRIORITY MAIL®, EXPRESS MAIL® AND PACKAGE SERVICES
Priority Mail® - Flat Rate Envelope
Priority Mail® - Flat Rate Box*
Express Mail® - 0.5 lb. Post Office to Addressee
Parcel Post – 1 lb. Intra-BMC Local Zone
Media Mail – 1 lb. Single-Piece
Library Mail – 1 lb. Single-Piece
SELECT RATES FOR EXTRA SERVICES
Return Receipt (paper-based)
Electronic Return Receipt
Address Correction – Manual
Address Correction – Electronic
View complete rate tables at usps.com
* The Governors of the USPS have requested that the Postal Regulatory Commission reconsider the amount of this increase.
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