Fish gotta swim, birds gotta fly, and the Postal Service... well, the Postal Service has to raise rates.
In May 2006, the Postal Service Board of Governors (BOG) submitted a rate "adjustment" to the Postal Rate Commission (PRC), and new rates were put into play on May 14, 2007.
This is not just a normal rate increase across the board—there is a tangle of new regulations that will affect how mail is classified and how rates are applied. The Postal Service has based these new rates on perceived efficiency in handling different kinds of mail, and it has more shape-based rates than in the past.
The easiest mail for the Postal Service to handle is automated letter-size mail. This includes any mail that falls within the letter size dimensions—6-1/8" high by 11-1/2" long and no more than 1/4" thick. This could include slim-jim catalogs and oversize postcards.
Virtually all of this mail is processed by automated equipment at the Postal Service, requiring very little labor. As such, it is the least expensive classification of mail, and has suffered a relatively small increase—generally less than 9% across all classes.
Flat size mail is another story. What constitutes a "flat" covers a lot more territory than letters. Anything from a 6" x 6" card to a 12" x 15" 200 page directory can be considered a flat, and they are much more difficult to process by machine.
The rates for flats are considerably higher than for letters, and they generally increased more—in many cases, a lot more. A typical small to moderate size mailing may cost up to 50% more. Expect increases of at least 20% across all classes of flat-size mail.
Another problem is that the flats you sent out in the past may not be classified as flats any more—and some flats may now end up being classified as a Non-Flat Machinable... umm... Flat. The Postal Service refers to this as a NFM. It's become popularly known as the Non-Flat Flat.
When a flat becomes an NFM depends on its physical characteristics and how those characteristics work with postal equipment.
The Postal Service has two primary pieces of flat sorting equipment. The older machine, the UFSM 1000, could handle just about any size or shape of mail but uses an army of operators to hand-feed mail into it.
The stylish new AFSM 100 operates with a much smaller crew because it has an automatic induction system. This, however, makes it much pickier as to what kind of mail it will accept. Mail that fails to meet its more stringent requirements falls into the fearsome Non-Flat Flat classification.
The penalty for this change in category is about 200% worth of postage. A 35-cent standard flat could become a 95-cent NFM. Ouch!
The chief characteristics of an NFM have to do with rigidity and irregular thickness. A typical magazine or catalog with decent quality paper should have no issues with the NFM classification.
Irregular thickness could be a bit more dangerous. For example, if you polybag an 8-1/2" x 11" catalog and drop in a smaller 6" x 6" 12-page piece in with it, it may become an NFM.
The other big issue is rigidity. A CD or DVD in a 6" x 6" jewel case is definitely an NFM, as would be a catalog mailed in a corrugated cardboard box, because it is too rigid for the machinery.
The changes to flat size mail are the most controversial and challenged items in the new rates.
Of course, I've only touched on some of the highlights here—there are countless changes as part of the new rates: a per-container surcharge for periodicals mail, higher small parcel rates, new weight rules for letters, added procedures for automated rates, and more. To find out more details, visit www.usps.com and ribbs.usps.gov.
Postal rates will go up, and yet your marketing plans will still need to include direct mail—they always do. Armed with a little knowledge you can minimize the effect this rate case has on your mailings and use it to your advantage.
