We all know stamps went up 2 cents (or 4.76%). Overall, the increase is 3.5%. Almost all classes we checked got an increase this year (including the 01/18/09 partial increase). However, not all did.

Most of the the parcel rates already went up on January 18. Bound Printed Matter was not included. BPM Flats are the big winners in the classes we’ve looked at so far. For non destination entry, the per piece rate and almost all the per pound rates went down. Overall, shippers should expect a net decrease of about 2 percent.  For destination entry, the per piece rate went up, but the per pound rates went way down. I would expect a net decrease of 7% for these shippers. On the Parcel side, the non-destination rates went up about 7 percent, but this is offset by a decrease in the per pound rates for destination entry. Our analysis of typical customer files, which include substantial DBMC drop shipments, nets an increase of less than 1 percent.

Unlike last year, non-profits aren’t excempt this year. Average non-profit rates rose by about 4.25%. While this is modest, and in line with the general increase, it’s still not the good news they got last yeat (when they saw decreases).

If you’re tracking the unfolding story of the Intelligent Mail Barcode, there’s news for you here too. Effective 11/29/2009, Full Service IMB shippers will be able to deduct $0.003 per piece for First Class shipments, and $0.001 per piece for Standard Mail. Not a lot, but it adds up.

If you’re interested in a particular class of mail, please leave a comment and we’ll post the details.

Besides the obvious need to stay in line with USPS mailing policies, there are many compelling business reasons to comply, even if your primary class of mail isn’t effected, yet.

The USPS goal is to reduce the amount of Undeliverable As Addressed (UAA) mail. In 2006 alone, over 9.7 billion pieces of mail were sent out with addresses that could not be delivered. This cost almost $1.9 billion to process, forward, return, or destroy.

There are several factors that lead to a mailpiece being undeliverable. The recipient may have moved. The address could have a typo and be invalid. A rural route address may have been replaced with a “911″ street and number type address. All of these can be corrected by different processes.

The USPS has already moved to make DPV (Delivery Point Validation) a requirement for all Automation Rate mailings, which includes First Class, Standard Mail and Periodicals (like magazines). Now, during the CASS (Coding Accuracy Support System) process, an additional database is used to insure the address is an actual point that can be delivered. For example, Main Street may have address numbers ranging from 100 to 500. If a record has a number of 550, it would be rejected by DPV. By catching and correcting these pieces before printing and mailing, postage and processing delays can be saved.

The latest development is in the area of NCOA (National Change Of Address). Whenever you fill in a change of address card, or go to the USPS Change Of Address web page,  a record is generated in the NCOA master database. By comparing addresses against this database, a mailer can find the new address when someone has moved. Originally started as an optional service, NCOA is now required for First Class Mail. In November, NCOA will also be required for Standard Mail. Most people expect it to become a requirement for Periodicals next year. Another change occurring in November is that the mailing list must have been processed through NCOA within 95 days of the date of mailing. Previously, the standard was 185 days.

Normally, when a list is processed through NCOA, it is also run through LACS (Locatable Address Conversion System). This converts rural route addresses to street name / box number type addresses (911 addresses). This is often included with NCOA for no additional charge.

Mailers failing to comply with the Move Update rules stand to lose their automation discounts. This would apply to all the pieces in a given mailing, not just those pieces which couldn’t be delivered. Obviously any violation would also invite increased scrutiny of future mailings.

In the future, Compliance will be easier for the USPS to track. With the advent of the Intelligent Mail Barcode (IMB or OneCode), every piece will include a mailer ID field. Currently, USPS facilities close to the mailer can easily determine and track back to the mailer. With IMB, they will be able to identify the mailer at any level.

The IMB isn’t all bad news when it comes to Move Update. The Address Correction Service (ACS) is cheaper and easier to implement when you implement “full service” IMB. Each piece is assigned an unique ID. When the USPS forwards or fails to deliver a piece, and electronic letter is returned, which you can use to update your mailing list.

Besides the threat of losing automation discounts on current and future mailings, there are other reasons to use the Move Update resources. If you clean your list to include current, non-duplicate, deliverable addresses, you will mail fewer pieces, qualify for automation discounts, and your items will be delivered more quickly and accurately. These reasons alone will more than repay your efforts.

Originally, the plan was to force the mailing industry to drop the old Postnet bar code and change over to the IMB in January 2009. Even though they have adjusted their schedule, you should begin planning. There are already many benefits you may wish to take advantage of. Currently, you can continue using Postnet  until May 2010. It will still receive the base Automation discounts available with “Basic” IMB. “Full Service” IMB will receive an extra discount beginning in May 2009.

We’ll pause here for some definitions. Postnet is the old postal bar code that’s been  around for years. This is the pattern of tall and short bars underneath the address, or down in the lower right corner. If you wanted to do tracking, you could also add a Planet bar code. This  looked the same, but was usually placed on top of the address. If you wanted to use ACS (Address Correction Service),  more codes, in text, had to be placed above the address. If this sounds ugly and crowded, it was.  A lot of people avoided these advanced services for that reason alone. Here is an example address with Postnet, ACS and Planet codes. It’s not the sort of thing designers like to see on their artwork.

There are a lot of details to iron out. For example, the amount of discount between Full Service and Basic IMB is yet to  be defined. It is widely assumed, but hasn’t been confirmed, that Postnet will receive the same discount as Basic during the transition period. At this time, there is no implementation schedule for Business Reply Mail or Package Services. All this and much more will be decided in the coming months. A good place to learn more, and keep up with the latest developments is the dedicated USPS OneCode information website, located at http://ribbs.usps.gov/onecodesolution. We’ll also update this posting as more facts are revealed.

The IMB, also known as the 4-state barcode, is a replacement of the older Postnet barcode used to assist the post office in routing First Class, Standard Mail and Periodicals based letters, flats and some parcels. You probably have already received mail using the new IMB code. Where Postnet had short and tall bars that were level on the bottom, the IMB “sticks out” on both the top and bottom. The reason for this is to increase the amount of data that can be stored in the code. In the original implementation plan, mailers were to be required to switch over to the IMB by January 2009. While there are still many reasons for mailers to convert as soon as possible, the new plans are more flexible.

Here is the text of the letter from the Postmaster General…

Thank you for your feedback on January’s Advance Notice of Proposed Rulemaking in the Federal Register concerning the implementation of the Intelligent Mail Barcode (IMB).

Your comments were thoughtful and thorough. I am encouraged by the number of responses received and the support of the IMB vision of true transparency, visibility and real-time data. It is all about increasing the value of the mail.

You also raised a number of implementation concerns that we need to address. Implementation of the IMB is so important to our future that I am taking the unusual step of giving you advance notice of some of the changes you can expect in the Proposed Rulemaking we plan to publish in the Federal Register next month.

Here is a preview:

• Many of you told us that January 2009 was too soon. We will propose a May 2009 implementation, concurrent with our next annual price change.
• We understand from you that many factors will drive the choice between the basic and full-service options. The May 2009 implementation will include separate prices for the full-service and basic option.
• The Postnet Barcode will remain eligible for an automation price until May 2010. Those prices will be announced with the May 2009 change.
• The proposal will include new options for mail owner identification.
• We are removing the requirement for green color bars on the container label.

Again, thanks for your responses. I encourage you to continue your implementation efforts and to comment on our next notice. Let’s work together to make the IMB vision a reality.