Links to the resources mentioned in the podcast.
On today’s podcast, I discuss this year’s National Postal Forum, USPS market competitive price increases, and we now have a fully seated USPS Board of Governors.
Welcome to the podcast everyone!
After three long years, we are finally able to gather together in person at the National Postal Forum in Phoenix, Arizona. I am super thrilled to be going to this year’s NPF and I hope many of you will be there as well.
The theme for this year’s NPF is Facing the Future Together, and I think that underscores something very important for us to remember. The USPS on its own cannot effectively bind the nation; it requires a public, private, partnership that includes mail owners, mail service providers, equipment manufacturers, software providers, data service providers, and logistic and transportation companies. It is an ecosystem of millions of people working together. And thus, I think the theme of the Forum is appropriate as we need to continue to work together if we are going to have a stable Postal Service capable of providing the universal service we pay for and expect.
The NPF is well-known for its excellent workshops and USPS executive led sessions, and this year’s NPF looks to continue that with presentations focused on innovative technology, eCommerce, leadership development, operational efficiencies, and ways to enhance the value of mail. For myself, I am particularly interested in attending sessions that discuss how to leverage Informed Visibility for enhanced mail tracking and strategically timing multichannel marketing campaigns, plans for the local, regional, and national USPS Connect initiatives, continued enhancements with Informed Delivery, and of course best practices in address quality. CASS Cycle O is well underway and if you want to make sure you have timely, predictable, and ultimate delivery of your mail pieces, you will want to stay on top of what CASS Cycle O certified technology can provide to help reduce undeliverable as addressed mail.
In addition to attending workshop sessions, I myself will also be presenting two workshops at NPF. On Sunday, I will be presenting Mitigating the Great Resignation with Automated Workflows. In this session, I will be sharing what our customers have told us about the challenges they are having in attracting and retaining people to prepare mailings using the various software and data services necessary to achieve postage discounts. Mail preparation continues to be complex and not only do you need a subject matter expert to presort the mail, you need someone to actively monitor the USPS Business Customer Gateway in order to prevent or mitigate mailer scorecard errors. Emerging technology and software can help automate some of these processing and monitoring responsibilities, which can in turn help mailers to repurpose resources for other growth areas.
On Monday afternoon, I am also teaching a class on address quality entitled Where Did My Customers Go Now. Keeping up with customers on the move is a continual challenge and it seems that fewer people are filing a change-of-address with the USPS. In this session, I am going to share best practices in how you can strategically leverage USPS and industry sourced data in order to further reduce UAA mail and reconnect with customers that moved but may not have filed a change-of-address with the USPS. In addition to the workshops, I am also planning to spend as much time as I can in the exhibit hall. This is often where I can get the best pulse of the industry by hearing directly from customers and partners about their business, what is working or not working, and of course ways to enhance the software and services they rely upon to presort the tens of billions of pieces of mail BlueCrest and BCC Software help to enhance.
If you do come to the exhibit hall, please make sure to make your way to the front right corner where you will find BlueCrest, BCC Software, and our newest acquisition Window Book all in a row. I am very pleased that we were able to get all three booths together like this as I am hoping it opens a dialog in how we can collectively enhance an entire end-to-end workflow for our customers and partners to enhance the overall value of mail. This includes the exciting innovative services Window Book is providing for mailer scorecard monitoring. Mailer Scorecard errors can be costly, sometimes exceeding thousands of dollars, so this is something I think all mail service providers should consider.
While I am looking forward to a great NPF, I have to admit I am not looking forward to the extreme heat of Phoenix! The forecast is showing temperatures in excess of 100 degrees each day, and for a guy coming from Minnesota where the ice just recently melted from the lakes, that is going to be like walking into a sauna don’t-cha-know. Seriously though, please do stop by booths 701, 801, and 901 if you do go to NPF as I’d love to say hi and ask how we can help enhance your mailing operations.
Now, turning to postage price increases, the USPS recently filed for increases to market competitive products including new prices for certain International Special Services and product enhancements for Priority Mail and Parcel Select. The price increases, if approved by the Board of Governors, would take effect on July 10 to coincide with the market dominant price increase I discussed in a prior podcast.
Additional changes for this filing include extend cubic rates to Priority Commercial Base and introduce cubic rates for Parcel Select Ground packages up to 1 cubic foot. And separate from the filing, the Postal Service is also planning to update the way the distance between origin and destination ZIP Codes is calculated to determine zone assignment. Rather than using the distance between origin and destination plant, the Postal Service will use the distance between 3-digit ZIP Codes to determine zone on July 10, 2022. This change is something I plan to research a bit more as the USPS published zone chart is used by many non-mail companies and it will be interesting to see what impact it may have on them as well.
Since I am discussing pricing, I think it is important to note that PMG DeJoy recently stated during the May 5 Board of Governors meeting that the industry should prepare themselves for uncomfortable increases for quite some time. He stated that the USPS finances have been severely damaged by ten years of too constrained increases. While he didn’t say how often the USPS would increase prices, we should be prepared for the USPS to consider increases twice annually in July and January as they had previously noted.
If you look at the year-to-date fiscal results for the USPS as posted on their webpage, you will see that while revenue is up as expected due to the successive and substantial price increases, operating costs are also up due to inflation and in fact outpaced the increase in revenue. Thus, when compared to same period last year, the USPS is in the red by over $2 billion compared for the first half of this fiscal year. So, my advice to our listeners is to take the PMG at his word that there will continue to be uncomfortable price increases until the USPS can project a self-sustained financial position.
Finally, I am happy to share that we now have a fully constituted USPS Board of Governors! The Senate confirmed President Biden’s two recent nominations of Dan Tangherlini who replaced former Governor Ron Bloom, and Derek Kan. This means we now have nine Governors, four of whom are politically aligned as Democrat, four that are politically aligned as Republican, and one that is Independent. It also means that the majority of the currently seated Governors was appointed by President Biden, a minor footnote as I personally do not believe that the President, whomever it is, directly controls the affairs of the USPS. Moreover, based on prior Board of Governor calls, it sounds as if PMG DeJoy has strong support from the entire Board of Governors as he continued to implement the Delivering for America Plan. In short, PMG DeJoy is here to stay for quite some time, or at least until he is able to put the USPS on a financial stable path.
As I wrap up the podcast, I did want to remind our customers that are listening to consider attending our annual Information Exchange User Conference this August. It will be held in Rochester, NY from August 9 to the 10th, and as in former years, this is a venue to openly and candidly discuss how to further enhance our solutions, share best practices, and get the latest insight into the current product roadmap. With the recent acquisition of Window Book, I think this year’s Information Exchange will be particularly beneficial to mail service providers who are looking for enhanced automated workflows and ways to minimize and mitigate Mailer Scorecard errors, especially undocumented pieces. To learn more about Information Exchange, visit the www.ieuserconference.com website and I hope to see you there.
Folks, I want to thank you for listening to today’s podcast, and if you’d like to learn more about mail tracking, or how to better automate your mailing workflows, please visit us at BCC Software.com or give us a call. As always, we’d like to know “How can we help?” Thank you for listening to the podcast, and have a great day!