For mailers, don’t expect 2016 to be business as usual. Businesses of all shapes and sizes will see a continued increase in sending costs, which include everything the organization sends out: parcels, flats and mail. In addition to higher sending costs, businesses will also be forced to manage increasing complexity. They’ll need tracking and tracing capability across carriers and much greater visibility into the end to end sending process.
Sending grows more costly—and complex
Shipping costs continue to rise, including recent rate hikes and surcharges by FedEx and UPS and the January 17th rate increase by the United States Postal Service (USPS). As shipping rates rise, it becomes even more critical for businesses to optimize sending across carriers and within carrier services.
Let’s take a closer look at the recent USPS rate change, which increased the rates for the following service categories: Priority Mail®, Priority Mail Express™, First-Class Package Service™, Parcel Select ®, and Standard Post™. The average price change is 9.5 percent, including large envelopes and packages over ¾ inch thick or more than 13 ounces. This price increase includes shipments using USPS Flat Rate Envelopes and Priority Mail boxes, and any box shipped as Priority Mail using your own packaging.
The good news for mailers is there was no change in pricing for USPS First-Class® Mail, which still provides a ½ cent discount for meter users, and for Standard Mail, Bound Printed Matter or Media Mail. In addition, the USPS has upgraded its tracking systems to compete with FedEx and UPS and allows you to track packages from drop off to final delivery. Tracking is free on any shipment that includes an approved barcode label. Another plus with the USPS is electronic return receipt for mail. Opting for this instead of the traditional green card gives you the accountability of certified mail at a much lower cost.
Service levels and options among carriers abound, but each carrier has its own set of processes. And since sending can originate from any desktop in the organization, most companies wind up with multiple accounts with several different carriers. Choices are made by the senders based simply on convenience, preference, or the relationship they have with a particular carrier. Lack of visibility into this complex array of sending spends makes it difficult for businesses to implement standard processes necessary to control these escalating costs.
Finally, many businesses have seen growth in cross-border sending. That requires dealing with different currencies, tariffs, regulations, etc. as they take their businesses global on the Internet.
Recommendations for 2016
The growing complexity of sending has dramatic implications for mailers of all sizes. What should you do to get control of the situation? The answer, in a word, is: simplify. Here are three things you can do right now to start taking control of the growing complexity.
1. Standardize sending processes across the company by doing a sending audit. Do you send packages from one place, mail from another? Where do you keep the tracking numbers? Do you pay different rates to the same carrier? How are different people in the organization sending differently? You can optimize the process by doing one or more of the following: centralize management of all carrier expenses; put all tracking numbers in one database; review all carrier rates charged across the organization. Out of this, create a standard sending policy that will give you greater visibility into the true cost of sending within your organization.
2. Center your sending strategy on meeting customer needs and maintaining customer contact. Choose the carrier or carriers that best serve your customer’s area and best meet their delivery requirements.
3. Leverage new technology. New Software as a Service (SaaS) sending solutions can enable a consistent and unified approach to sending across locations and carriers. Senders from any desktop will have the tools to select the right carrier for each parcel based on a simple multi-carrier view. In addition, all sending charges will be automatically reconciled to one account on one bill, facilitating simpler multi-carrier management. Carrier pickup can be initiated from any desktop, tablet or mobile device. The same cloud-based technology can also improve the package receipt process, so inbound tracking capability becomes as convenient as outbound shipping.
Don’t expect business as usual in 2016, as sending grows ever more costly and complex. On the bright side, expect to see solutions, powered by new cloud-based technology, that will enable you to originate a multi-carrier sending and receiving process from anywhere in your organization while maintaining the visibility you need to manage costs.
Patrick Brand, Senior Vice President and General Manager, Global SMB Products and Business Strategy, Pitney Bowes
