The one bright spot on the 6% postal increase going into effect on January 26, 2014 is that customers using a postage meter will save $.01 per letter. The USPS has come out with a new class called Single Piece Metered Letters which allows for this savings. These rates should automatically be downloaded into your meter with no involvement from the operator. Although this is not a windfall, it can help pay for 3-20% of the typical mailing system.

 

 

The first question is why are they doing this? I think the USPS feels that this group of mailers is looking for electronic substitutions and this is a way to give them an incentive to keep mail in the system. This is a very specific group of customers that has volumes too low to either barcode or use a presort service to get the better automation rates. We can see that this group is at risk by the 4-5% decline in the meter population annually. Also, when an item is metered, the cost for the USPS to process the letter is less than with a stamp.

Although it is great to get a savings, we have to put it in perspective with the reality of what these customers are mailing. As you can see from the chart above, most business mailers are doing much less than 20,000 First-Class Mail® Letters per month. The savings from this is nice but is not going to pay for the equipment that is being used. I have included what we see in the marketplace for the average costs customers pay for machines that can handle this volume of mail. I bring this up in case you are looking at buying new equipment and this is a major selling point from the vendor. The savings will help but only to cover a small portion of the costs.

 

Any savings is a good savings and the fact that the USPS has singled out metered customers only helps. This will hopefully soften the blow of one of the largest rate increases we have seen in years.