No one would disagree that managing your postage expense is important. Postage is probably one of the costliest line items in a mail center budget, and certainly one of the most visible. Because of coverage in the popular press, the postage bill is often the center of attention when executives look to reduce document processing costs.
But what is a mail center manager to do after they've already qualified their mail at the lowest possible rate and they are still asked to trim expenses? Surprisingly, there are lots of places where the overall costs to produce, process, and mail documents can be reduced. Here are some opportunities to investigate in your own operation.
- The cost to apply postage - Everyone thinks about the cost of the postage itself, but rarely is there any consideration given to what it takes to actually pay for the postage. Meters are expensive - there is the meter rental itself, consumables like ink and print heads, and the need to have a phone line or internet connection for replenishing funds. Added to those costs is the loss of use of the money while it's sitting in the meters and the possibility of incurring expenses when metered envelopes have to be opened, emptied, and the postage recovered. Meters are also a common place for jams to occur and they may be the slowest component of the inserter. Take a look at your applications and see if you can use permit mail for at least some of your jobs.
- Use the appropriate mail classification - Sometimes shops that predominantly deal with first class mail just automatically send everything out in that class. But some mailings, such as marketing pieces, surveys, or newsletters qualify for Standard Mail rates. You can save money by picking the mail class that best matches the mail piece content and delivery requirements. Remember that Standard Mail doesn't include free forwarding, or strict delivery standards so be sure to take these facts into account.
- Householding the mail - The postage cost of the second ounce of first class mail is a fraction of the postage, handling, and material costs of a separate mailing. See if you can get the print-generation processes changed so that you can include multiple documents and notices that are going to the same address into a single envelope. This could require some schedule juggling so that mail pieces that are generated by separate print streams can be produced on the same day. Use print stream manipulation software to rearrange the pages and revise inserter control marks.
- Does all your mail require an envelope? - Did you know that you can mail a presorted First Class postcard for about 13 cents less than a letter? Of course, some material must be enclosed in an envelope to preserve security. But you might be surprised to find that there are a few jobs in your shop right now that could be converted into postcards, such as notifications or reminders. Save your company postage, materials, and a lot of time.
- Improve your materials - Make sure that that poorly-designed materials are not causing delays and extra labor by being the source of jams, re-prints, undelivered mail, or slow-running equipment. Sometimes spending more on the materials is actually less expensive than fighting with cheaper stock that continuously causes problems. Documents that run fine on the equipment but don't clearly communicate the message can have an adverse effect on overall corporate costs too, when confused recipients call customer service to help them understand what came in the mail.
- Get everyone trained - Most shops have some operators that consistently out-perform the rest. Find out what they do to achieve higher productivity and teach the rest of your staff. You might also consider sending top operators to school where they can learn to service their machines allowing you to move some of your maintenance in-house.
- Don't waste time and money on undeliverable mail - It seems so obvious, and yet we see it all the time. Address files are inaccurate. Some pieces get printed and mailed even though they are lacking critical data such as city, state, and zip. Even more common are pieces that get mailed - and returned as undeliverable - month after month. Start an aggressive campaign to research undeliverable addresses, get them fixed, or remove them from the print file altogether. There are many address quality tools and methods available to help in this effort.
- Eliminate unnecessary mail - Sometimes the mail is deliverable, but may be of little value to the company or to the recipient. Zero-balance statements are a good example of mail pieces that perhaps shouldn't be printed more than once unless there is new account activity. Identical documents that are triggered by more than one internal process are another case where the second or third piece of duplicate mail is a waste.
- Redesign documents - Can you cut down on page-counts by doing a little reformatting? Sometimes just narrowing the margins or reducing the font size by one point can be enough to turn large volumes of your two-page documents into singles. Most people are utilizing the duplexing capabilities of their printers these days, but there may still be opportunities there. Also consider converting to summary statements, creating the detail pages for only those customers who request them.
- Evaluate your shop floor workflow - Ideally, the production areas should be set up so that there is plenty of room to stage the work and materials without impeding necessary movement throughout the shop. And work should be planned so that operators are not required to stop their machines and wander through the warehouse looking for forms, envelopes, or inserts. These little trips invariably include stopping to chat with (and interrupt the work of) other staff members, getting coffee, taking extra smoke breaks, and consuming snacks. Before you know it, you've lost an hour of productivity. Have the warehouse crew stock the production areas with sufficient materials and remove the empty boxes and pallets.
- Eliminate re-work and manual error discovery - Many shops rely upon the clipboard method of batch balancing on printing and inserting jobs. If a job is out of balance, most make an attempt to find the error manually. If they can't find the error in a reasonable amount of time, the batch is scrapped, re-printed, and re-inserted. Camera technology has evolved to a point that there are several vendors offering very reliable mail stream integrity capabilities. It may be time to invest in one camera at the end of the inserters and do a simple sequence-check.
- Automate manual processes - Not all processes are improved by automation. But sometimes a job that started with a small amount of manual handling has grown, unnoticed, into a significant effort. There may be an opportunity to improve productivity and raise quality with some automated steps.
- Business reply mail - Some companies use it sparingly. But others use it a lot! Review how many permits your company maintains and take a look at the applications that include business reply envelopes. By combining under a single business reply permit you may be able to take advantage of volume discounts offered by the USPS. While you are at it, you might as well check out the post office boxes as well. Companies often simply renew box permits year after year, even though little or no mail is ever delivered to them.
Every time there is a postage increase, mail center managers and their bosses always seem to concentrate on just one aspect of lowering costs - reducing the postage bill. But there are areas in every operation that have opportunities for savings that are often greater than what can be achieved with better presorting or comingling. It takes a regular review and a critical eye to constantly improve operations and take advantage of new technological developments.
Mike Porter is President of Print/Mail Consultants, an independent consulting firm that helps companies nationwide be more productive, adapt to changing requirements, and lower costs in their document operations. His first book, "Take This Job and Stuff It! A Practical Guide for Document Operations Managers" is due out the summer of 2008. For more information, visit www.printmailconsultants.com/ or email Mike directly at mporter@printmailconsultants.com
