A. Postal Service™ shipping services prices will change Sunday, January 18, 2009. The changes include new prices for all Express Mail®, Priority Mail®, Parcel Select® and Parcel Return Service, as well as prices for Global Express Guaranteed®, Express Mail International®, Priority Mail International™, and direct sacks (Airmail M-bags).
This is the first time the Postal Service is establishing separate price change implementation dates for shipping services and mailing services products. We will announce new mailing service prices, which include First-Class Mail® stamp prices, each February to take effect the following May.
A. The move to an annual January implementation date for shipping services price changes aligns the Postal Service with price changes among other shipping companies, and provides a clearer picture of the competitive, affordable products the Postal Service offers.
A. We will announce new stamp prices and other mailing services prices in February to take effect in May 2009. Prices for Postal Service mailing services are capped by class of mail at the rate of inflation as measured by the Consumer Price Index (CPI). The current CPI rate is available on the Postal Regulatory Commission website at www.prc.gov.
Shipping services prices do not have a price cap, but there is a price floor: each product must cover its costs, and in aggregate the shipping service products must generate sufficient net contribution to cover 5.5 percent of the Postal Service’s institutional costs.
A. Complete USPS® pricing information, including commercial base and new commercial plus pricing for Express Mail and Priority Mail service, is available in Notice 123, Price List, at www.usps.com/prices.
A. Prices will increase an average of 5 percent. By comparison, competitors announced price increases of between 5.9 percent and 6.9 percent.
Unlike other shipping companies, the Postal Service does not impose surcharges for fuel, residential delivery, or Saturday delivery. Our new prices are very competitive within the shipping industry, and reinforce the value Postal Service products have for our customers. The average price change for each shipping service is:
The costs of doing business — for things like transportation, utilities, and health care benefits — have continued to increase. Without an increase to keep up with rising costs, we face significant losses. Many people do not know that postal operations are not subsidized by tax dollars. We rely on the sale of postal products and services to cover our operating costs.
A. The Postal Service is aggressive about cutting its costs responsibly. Like other businesses, the Postal Service cannot fully make up for the increase in its expenses by cutting costs. Many costs are influenced by factors outside the Postal Service’s control, such as fuel prices or economic conditions. However, for each of the past several years we have committed to taking a billion dollars in costs out of the system, and took more than $2 billion in costs out during fiscal year 2008, which ended September 30. Labor-related costs account for about 80 percent of our expenses.
A. Express Mail customers who purchase postage online and those that have an Express Mail Corporate Account will now save 5 percent off the retail price. Priority Mail customers who purchase postage online will continue to save an average of 4.7 percent (1 to 11 percent) off the retail price.
A. We will expand commercial base prices for Express Mail International to include customers who pay postage using an IBI metering system and transmit Customs forms electronically, and customers who pay postage through an Express Mail Corporate Account, Click-N-Ship® service, or registered end-users of approved PC Postage® vendors.
A. Commercial plus pricing is new for 2009. It is an extraordinary value for high-volume Express Mail and Priority Mail users. New Commercial Plus prices for Express Mail service are 14.5 percent less than retail prices on average, and for Priority Mail service, 7 percent less than retail prices on average.
A. There are a few new mailing standards consisting of minor classification changes to support the price changes. We will:
A. Parcel Select combines parcel consolidator expertise and logistics with the vast delivery network of the Postal Service. Parcel Select continues to be an excellent solution for high-volume shippers.
A. We are continuing Loyalty Incentives and Growth Incentives for large-volume Parcel Select shippers based on destination delivery unit (DDU) growth only. Customers who qualify for these incentives will receive annual rebates ranging from 2 to 14 percent of DDU postage.
A. Parcel Return Service is the companion product for Parcel Select, for merchants who receive a large volume of returns and want to provide their customers with the convenience of a return solution, and for shipping consolidators or reverse logistic providers. PRS features free Carrier Pickup™ service and competitive rates with two pricing options.
A. Priority Mail International customers using Click-N-Ship or PC Postage service, and customers who pay postage using a permit imprint and approved software for mail preparation and Customs-related functions, will continue to get a commercial base price 5 percent lower than the retail price. We will expand availability of the commercial base prices to include customers who pay postage using an IBI metering system and transmit Customs forms electronically.
A. Commercial base prices are not available at Automated Postal Centers® (APCs®).
A. Only Priority Mail commercial base and commercial plus pricing includes no fee (electronic) Delivery Confirmation™ service.
A. There are no changes to the application of dimensional-weight pricing to Priority Mail items destinating to zones 5 through 8; and to the application of (minimum) balloon pricing to Priority Mail items destinating locally and to zones 1 through 4, and all Parcel Post/Parcel Select.
