As per the Postal Act of 2006, the USPS is preparing for their annual rate increase. The new prices are going into effect on May 12, 2008. Both consumers and mailers would be well advised to check out the details.

From a consumer’s standpoint, the most important thing is, the First Class Single Piece rate (a regular stamp) will increase from 41 cents to 42 cents. The “Forever Stamp” is already looking like a good deal.  The USPS is continuing to expand on their “shape based” initiative with a flat/”Large” envelope going up 3 cents, and parcels/”Packages” getting a 5 cent increase.

Mailers will want to closely examine the rates posted on the new USPS prices page. Our initial impressions show this to be a relatively modest increase. However, there are some surprises. While the USPS has announced lower additional-ounce price for presorted First-Class Mail letters, this simply brings the basic presort rates into line with the automation rates. They also tout a lower per pound price for Standard Mail letters (ECR saturation and high-density) and Standard Mail flats. We also note other areas where postage has dropped.

There are many complicated things going on in this new rate case. For example, in Bound Printed Matter, the per-piece rate for non-destination parcels has dropped, while the per-pound rates went up. Both the per-piece and per-pound rates for destination entry parcels increased. Mailers would be well advised to model the effects of the new rates.

Updated prices for Express Mail, Priority Mail, and Parcel Select will be released in March.

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