12 simple ways to reduce postal costs

By Stan Holden

During the first three months of 2009, the U.S. Postal Service lost $1.9 billion. During the previous 12 months, it lost $2.8 billion. So, perhaps understandably, the USPS is once again raising postage rates.

In January, it increased the rates for Priority Mail to $4.95 and Express Mail to $17.50 for flat–rate envelopes. But for most companies, the biggest change took place May 11, when First Class rates rose by an average of 5%.

To mail “regular” envelopes (no larger than 6 1/8 inches by 11½ inches by ¼ inch) it now costs 44 cents—up from 42 cents—for up to 1 ounce. The rate for each additional ounce, to a maximum of only 3.5 ounces, remains 17 cents.

To avoid overstuffing No. 10 business–size envelopes, consider using the No. 11 envelope, which is nearly 1 inch longer but within the limitations. Or use 6–by–9 envelopes.

If your mailing piece weighs more than 3.5 ounces—or is larger than 6 1/8 inches by 11½ inches—the cost starts out at double the smaller size. The first ounce will cost you 88 cents, up from 83 cents. Then, once again, it’s 17 cents for each additional ounce, up to a maximum of 13 ounces for $2.92.

If your piece is more than 13 ounces, it’s even more expensive. That’s because you’ll need to send it via Priority Mail at a minimum cost of $4.95. It might get there a little sooner than First Class mail, but if it is local mail, perhaps not.

All things considered—reasonably fast, dependable delivery to even the smallest town in any state—the rate increase is not unreasonable. But if you do a lot of mailing, those extra pennies can add up. Here are 12 simple ways to reduce, or at least contain, costs:

1 Know the latest postal rates And make sure everyone in your company who sends or handles your mail knows them, too. Ask each person, “How much does it cost to mail a letter in a business–size envelope weighing 1 ounce? Weighing 2 ounces?” If they don’t answer 44 cents and 61 cents, you could have a costly problem on your hands.

As noted earlier, the new rate for the first ounce is 44 cents. But the rate for a 2–ounce letter is not twice that, as you might think. It is 61 cents—only 17 cents more. And a 3–ounce letter will cost 78 cents to mail, not $1.32.

To avoid confusion and to control costs, remove any old rate charts that may be on your postal scales or mailroom walls and post a chart with the new rates. You can download and print a chart of First Class rates from www.usps.com. For the new rates for all classes and types of mail and for special services, download the latest May 11 Price List (Notice 123) from the same Web site.

2 Weigh your outgoing mail As a rule of thumb, four—or at most five—sheets of 20–pound, 8½–by–11 paper in a No. 10 or 6–by–9 envelope, weigh just under 1 ounce and can be mailed for the new rate of 44 cents.

Tell your employees that if an envelope seems heavier than usual, they shouldn’t add an extra stamp “just to make sure.” They need to weigh it first. The least expensive postal scales, available at office supply stores, are spring–activated, but over time they can become inaccurate. A better choice is an electronic scale. Prices range from about $36 to $146, depending on features and capacity.

Some postage meters—available only from five USPS–authorized manufacturers—come with an attached electronic scale and calculate the correct postage automatically if the current rates have been entered.

3 Check your scale regularly As a quick check, place 12 dimes on your postal scale; they should weigh almost exactly 1 ounce. Better yet, compare your scale with an electronic, self–serve scale at your local post office by weighing a typical mailing piece on both.

If your scale reads low and you rely on it, your outgoing mail may be returned to you for additional postage, delaying its delivery. Or it may be delivered with postage due, which is annoying to recipients. If your scale reads high, you’re paying too much for postage.

4 Guard your postage Keep stamps secure. They’re too easily misplaced or “borrowed.” If you use a postage meter, only specified employees should have access to it. Each morning, have a trusted employee jot down the amount of postage available and keep track of the amount used for each customer or for any mass mailings you do.

Watch out for employees using your postage to mail dozens or hundreds of wedding or party invitations, sweepstakes entries, personal newsletters, packages, etc. Because postage can be a tax–deductible expense, you need to know how much is used each year for business purposes and have the receipts to prove it.

5 Keep an assortment of stamps on hand If you don’t have a postage meter, or in case your meter’s balance is occasionally too low for the day’s postage, keep on hand an assortment of stamps in various denominations—44 cents, 17 cents and perhaps 1 cent, 2 cents, 3 cents, 5 cents, 10 cents and $1. Also keep a supply of $4.95 stamps for Priority Mail and $17.50 stamps for Express Mail.

Keep each denomination in a separate envelope or file folder. Or use a small storage box with a dozen or so compartments.

6 Use both sides of the paper If you’re sending letters or documents containing five or more sheets, you may want to print on both sides to reduce the weight of your mailing. To help ensure that both sides of each page are read, include a note at the bottom of each that says, “Please see other side.”

If the weight of the sheets is less than 3.5 ounces, fold the pieces of paper to fit into a 6–by–9 envelope to avoid using a larger envelope that requires 44 cents more for the first ounce.

7 Use email instead of “snail” mail The advantages are obvious: instant transmission, zero cost and no mailroom delays at either end. But with the ever–increasing glut of emails—both legitimate and spam—yours may be lost or ignored in crowded in boxes. Recipients also may be reluctant to open your attachments for fear of viruses or may have problems opening them because of software incompatibilities. A business letter, delivered the old–fashioned way via the USPS, may get more attention because it’s increasingly rare.

8 Know the pickup schedules Whether your company’s mail goes into a box in your office building, a street corner mailbox or at a post office, write down and learn the pickup schedule and watch for any changes. Get employees in the habit of mailing early in the day to avoid any last–minute rush. If you miss the last pickup or dispatch, you may have to send an important letter via an overnight delivery service at much higher cost.

9 Clean up your mailing list regularly Are you still mailing to those who aren’t likely to do business with you? People move, change and lose jobs, take vacations or maternity leave, retire and die. Companies merge, relocate, downsize, change their needs and go out of business. If you’re sending mail to an outdated list, you’re wasting money.

Once or twice a year, clean up your mailing lists. Eliminate obvious duplicates. It’s called merge/purge. Ask at your local post office about various list–cleaning services.

10 Consider using commercial (discounted) postage rates If you mail 500 or more pieces of the exact same size and weight at a time, you can qualify for a discounted First Class rate—as little as 33.5 cents for the first ounce—as long as the pieces meet specific addressing, presorting and bar coding requirements.

Even greater savings are possible if you mail 200 or more pieces at the Standard (formerly Bulk or Third Class) rate. If your mailing qualifies for the automation rate, with five–digit ZIP codes, each piece may cost as little as 19¢ to mail. The amount of savings increases as you fine–tune the sorting. What’s more, instead of keeping it under 1 ounce, you can stuff up to 3.3 ounces of material in each envelope at the same price.

However—and it’s a big however—it may take several days or even a week longer for your mail to be delivered, especially if it’s going a long distance, which can be risky if you’re making a limited–time offer or important announcement.

To do the required presorting and bar coding in–house, you need special software and must pay $185 per year for the appropriate USPS permit. It may be easier to have a local mailing house do it for you, but the fee the mail house charges will reduce your savings.
A warning: If you have several hundred First Class envelopes to mail and they’re being sent to people who requested something, don’t hold up your mailing until you have the 500 needed for the lower rate. You could easily antagonize prospects or customers, jeopardizing sales.

A mail house may be able to combine your mailing with another customer’s to meet the minimum requirement and avoid a delay. Ask at your post office for a list of local mail houses, call several for details and pricing and check their references.

11 Consider using postcards to generate new business Design postcards as you would a small ad. If your message can fit in a 6–inch by 4¼–inch space without resorting to type too small to be read easily, consider using postcards instead of letters or other types of promotional materials. You’ll save on the cost of paper, printing, envelopes, inserting, sealing and postage.

With the new rate of 28 cents per card—or as little as 20.5 cents each if you mail 500 or more and qualify for the five–digit ZIP code automation rate—postcards may be a bargain. Need more space? Use oversize cards—5–by–7 or up to 6 1/8–by–11½—sent at the rate for letters.

12 Don’t waste postage on ineffective mailings If you send out direct mail pieces to generate new business (and you probably should on a regular basis), you’ll save postage by making sure that each mailing is designed for maximum results. Ho–hum mailings are a waste of postage, printing and effort.

Direct marketing guru Dan Kennedy—who charges upwards of $50,000 plus royalties to create a direct mail campaign—advises:

  • Always include an offer—a special discount, bonus, freebie, sample, etc.
  • Give a good reason to respond right now.
  • Tell prospects exactly what you want them to do next, how they should do it, when to do it and what will happen as soon as they do—or what might happen if they don’t.
  • Track each mailing. Use a key number, extension number, free report number, etc., so you’ll know which mailings are working, which aren’t and what your return on investment is for each.
  • Capture the name, address, phone number and email address of each person who responds. Add it to your database if it’s not there already and do follow–ups until the prospect buys.
  • Use strong sales copy. Don’t be timid. Study the successful mailings of others. If you can’t write hard–hitting copy yourself, hire a freelance copywriter. The more effective your mailings are, the less significant the latest postal increase will be.
    By using some or all of the tips in this article, you’ll start saving money on postage—and be better prepared for the rate increases that are sure to come next year, too. BT

During the past 37 years, Stan Holden has written direct mail pieces for more than 200 advertisers, including AT&T, Hewlett–Packard, IBM, Transamerica, Sears, Ward’s, UAL and Sunbeam, as well as many banks, publishers and insurance companies. He has earned the Direct Marketing Association’s highest awards for both direct mail and direct response print ads. Holden also writes and publishes how–to guides. For more information, email [email protected]

 

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