
The USPS postal increase in May 2007 raised distribution costs by as much as 40% for mail
order catalogers in the “Standard A Flats” category.
Paper price increases of 20-25% on coated stocks from June
through December ‘07 only made the situation worse. Another
postal rate hike mid year 2008 and further paper price increases
of 20-25% through the end of the year will leave many mail
order catalogers with spiraling costs that are, to say the
least, difficult to bring under control.
The combination of
above circumstances has changed the typical 500,000 copy 48-page,
45# gloss coated consumer mail order catalog cost structure...
While
there are many ways to make slight improvements in press efficiencies
and paper selections, there remains only one way to improve
the cost structure dramatically without curtailing prospecting – changing
postal classifications. Postal rates were increased sharply
in May for lightweight flats pieces, but the USPS did remain
consistent with its long term philosophy of enhanced automation.
Much lower rates were offered to mailpieces that are able to
be machine sorted on current and future USPS automated sorting
equipment. The new “letter rate” allows
a properly prepared catalog to mail for as little as $0.199
each. See what our customers say about letter-rate:
After the postal rate increase hit our postal budget by more than 30% in May of 2007 we were hard pressed to continue to grow the catalog and to hit our circulation numbers. While working with Catalogs America, we were able to develop two specific offerings that sharply reduced our overall postal cost. By using two different catalog sizes–one standard and one letter rate–we have been able to reduce our postage to prospects and reallocate that money to our customer books. Which, in turn, has allowed us to increase page count and circulation.Jamie Conetta
We switched to the new format for our first drop of 2007, and used the opportunity to introduce a new style to the catalog overall that helped to refresh the brand. We’ve continued to see our business expand over the past year, giving us every indication that our new format, look, and feel are all positive factors for us.Sally Partridge
We produce a high-end organic bedding and apparel catalog. Switching to slim-jim with Catalogs America was a great move for us. We took the savings in postage and upgraded our paper, and still had money left over to increase our print run! It is the best-looking catalog we have had so far, with more square-inches than our previous size, and our sales ratios are consistent with last year’s full-sized piece. We have committed to producing the next three titles in this format.Cheryl Hahn
We produce a monthly catalog that is primarily a house list, and the switch to slim-jim allowed us to print and mail 20% more books per month than before for the same price.Cindy Larcombe
We like the new slim-jim format and feel that the one-time effort to change trim-size was worth the postal savings realized. It has allowed us to continue to offer a 68-page catalog without increasing our costs. We don't feel tabbing the catalog has discouraged customers from opening the book.Pam Thompson
With first-class mail slowly eroding away, the time is now to implement five-day delivery, according to Sam Pulcrano, vice president of sustainability for the U.S. Postal Service. “The dilemma we have is it’s growing and growing exponentially,” Pulcrano said during a March 29 conference call. “We really can’t do anything without legislative changes.”
The Postal Service has seen its mail volume fall 20% since 2006, and it’s expected to drop another 20 billion pieces in the next 10 years. First-class mail is expected to fall by 30 billion pieces, while modest growth is anticipated for advertising mail.
Multichannel MerchantAmerican Press in Gordonsville, Virginia has had several crews qualify for the Pacesetter Club in past years with its Pacesetter 1000 stitcher. This year, crews on all three shifts did the same with a new Pacesetter 2200 system, averaging as high as 20,875 books per hour.