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Mailing & Fulfillment — Looming Changes for Mailers

May 2008 By Leo Raymond
BABY BOOMERS may remember the poster (also used in IBM ads) that preached "plan ahead," but illustrated the result of doing the opposite. As 2008 moves along, looking at the changes ahead facing the mailing industry, the advice again may be to "plan ahead," but do better than shown in the poster.

Mailers can expect several significant events over the next year, stretching into early 2009:

o A rate case, or "price adjustment" as they're now called, this month;

o Implementation of tighter "Move Update" standards in November;

o Phase-out of more postage meter models by the end of 2008; and

o Implementation of the Intelligent Mail Barcode (IMB) in May 2009.

In addition, the Postal Service will conclude rulemakings about service performance measurement and address location on flats, and Congress and the Postal Regulatory Commission (PRC) will be considering reports about the postal monopoly, accounting rules for postal products, USPS "advantages" compared to competitors and other topics.

The Postal Service's interest in another rate increase has been known since last year, and observers' anticipation was satisfied in February with the agency's notice of a May 12 rate increase for all of its market-dominant products. (A second announcement in mid-March revealed new rates for competitive products, also effective May 12.)

True to its word, the USPS gave mailers 90 days notice of the major rate hike--twice what the law requires. But the value of 90 days notice isn't the same now as it was in the past. Although the 1970 law (replaced in December 2006 by "postal reform") prescribed a protracted ratesetting process, and although the final form of a case filed under that law wasn't known until the PRC issued its recommended decision, the duration of the process at least allowed for thought about, and general planning to comply with, the rules that would eventually implement the case's results.

However, the new rate-setting process for market-dominant products leaves mailers with just the 90-day notice assured by the Postal Service. As a result, the effective pre-implementation period has gone from more than a year to just three months, and the opportunity for mailers and their suppliers to prepare has been compressed accordingly.

Fortunately, the recent filing includes few changes in rate structure or classification, so the 90-day period might be adequate. Had the case been more complex (as future cases may be), software companies and their customers might have been apoplectic if their first look at what will be implemented came only 90 days in advance.
 

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