Postal Customers Fighting Proposed Postage Rate Increase

It appears that postal customers and some members of congress Congress are ready for a fight on the US Postal Service’s proposed rate increase set for January, 2011. Not only is the rate increase considered by many to be a bad business decision, the legality is also in question.

According to the 2006 Postal Accountability and Enforcement Act (called Postal Reform) the Postal Service can not increase postage rates by more than the rate of inflation, as measured by the Consumer Price Index.  The current proposed rate increase was filed under the “extraordinary and exceptional circumstances” (exigency) clause of the act. As a result, even though the Postal Service has less than a 1% rate authority under the cap, they are requesting a rate increase averaging 5.6%.

Not everyone agrees that the Postal Service’s current situation constitutes an exigency clause. In fact, the Senator Susan Collins of Maine, who authored Postal Reform, recently released a statement saying, “The authority to increase rates under an exigent case can only be used in extreme and unforeseen instances – such as terrorist attacks, natural disasters, and other events that would cause significant and substantial disruptive service. The law was not meant to be used to remedy poor economic performance or to offset an ongoing marketplace trend, such as increased use of electronic over traditional mail.”

Senator Collins is backing the Affordable Mail Alliance, an alliance of nearly 1,000 associations, companies, and, not-for-profits. The group formed specifically to fight the proposed increase and has recently filed a motion to dismiss the increase with the Postal Regulatory Commission. As of this writing the Commission has postponed making a decision on the motion until the ‘appropriate time’.

DW will continue to keep you up to date on the industries efforts to dismiss the proposed rate increase. To learn more about the Affordable Mail Alliance you can visit their website at www.affordablemailalliance.org

Spread the Warmth Campaign 2nd in MFSA Award

DW’s Spread the Warmth campaign has been awarded second place in the John Howie Wright Cup by the Mailing and Fulfillment Service Association (MFSA). The John Howie Wright Cup is given in recognition of a self-promotional marketing campaign with at least two direct mail components.

We mailed companies across Denver a pair of gloves and asked the recipient to Spread the Warmth by giving the gloves to someone who needed them. We also setup a landing page and asked recipients to go online and share their Glove Story.

The Spread the Warmth campaign resulted in a 17% response rate and is rapidly approaching positive return on investment. The campaign also achieved our goals of making a positive difference in the community and developing an example of excellent campaign design.

Earlier this year DW was also awarded a Gold Marketing Plus award for Lead Generation by the National Association for Print Leadership (NAPL) and we have been honored by the recognition.

Download a copy of the heartwarming Glove Stories here.

Welcome Jerry Poulin

DW welcomed Jerry Poulin to our sales team in April. Jerry’s background in marketing and business is priceless. He is committed to working with you to grow your businesses and eliminate your biggest frustrations.

Jerry is also committed to spending as much time as possible out on the golf course this summer. We hear he is pretty good, but the rest of us only know how to play putt-putt, so we need your help. If you are interested in beating Jerry in a round of golf and getting some free marketing advice along the way, give us a call.

Put Social Media to Work for Your Organization

The way the world communicates is changing. Get ready at our free one-hour seminar on May 7th at 9:00 a.m. and you could win 4 hours consulting with guest speaker Georgia Brown.

Georgia, of Sweet Georgia Brown Consulting, specializes in working with organizations to develop a customized social media presence.

Join us and Georgia will show you how to:

• Reach new customers
• Benefit from referrals
• Interact with customers in new ways

Seating is limited so register today. Call 303-858-1025 or email info@dwmailllc.com to register.

Don’t Mail that Light Bulb!

Last year a customer asked us to mail out Compact Florescent light bulbs (CFL’s). We thought it was a great idea and after preparing the mailing our driver delivered it to the Post Office. And then the phone rang. It was the Postal Service calling. “This mailing contains hazardous material”. But it’s a light bulb, we tried to explain.

In fact, CFL’s do contain a small amount of mercury, a substance that the Postal Service prohibits from the mail stream in most circumstances. There is no doubt that mercury is prohibited for a good reason. It is incredibly harmful, especially for children. But we were not trying to mail a gallon of mercury; it was just a light bulb.

After much negotiation and documentation that we obtained from the light bulb manufacture, the CFL’s were on their way. But the incident taught us a couple of important lessons:

1) If you are going to mail a CFL, use UPS or FedEx

2) Recycle your CFL’s.

CFL’s are great. They reduce your energy bills and cut emissions of greenhouse gases. But when we throw CFL’s in the trash, they break and mercury is released into our environment. Recycling them is easy:

• In the Denver Metro area you can recycle your CFL’s at any Ace Hardware store
• Home Depot stores nationwide also collect CFL’s for recycle
• Most hazardous waste collection sites will accept your CFL’s

If none of these are options for you, contact your local energy or waste disposal company to find out how to recycle CFL’s in your area

2010 Postage Rate Increase Still Possible

In February, the Postal Regulatory Commission (PRC), which has regulatory oversight over the Postal Service, questioned the Postal Service’s decision not to increase postage rates this year. The PRC is essentially arguing that the current postage rates are illegal because they are not sufficient to cover operating costs.

The PRC commented that if the Postal Service fails to file for higher rates, “Congress will be required again to bail out the Postal Service to avert insolvency by increasing the amount of taxpayer support through increased borrowing or subsidies.”

The Mailing & Fulfillment Service Association (MFSA), for which we are members, responded as follows:

“First, Congress’ action…is a forbearance of a debt, not a loan or grant of money as a “bail out” would be. Moreover, the debt itself is a unique mandate to prefund an expense that is yet to be incurred contrary to the practices of other agencies and most accounting rules.

Second, the Postal Service receives no taxpayer support or subsidies; the only funds it gets from the US Treasury are those payments promised it by past Congresses for required services, like free postage for the blind or reduced rates for authorized nonprofits. (Ironically, Congress regularly short-changes what it owes the Postal Service.)

Finally, it would only be appropriate that Congress remedy the Postal Service’s financial woes: Congress has prescribed the agency’s obligations and revenue sources, limited its ability to manage costs, and constrained its opportunities to enter new business lines…”

So what does this mean for you? In simple terms, mailers are facing two successive rate increases. Of course, nothing is set in stone yet and many organizations including MFSA and the Postal Service are working diligently to support the interests of those who use direct mail.

Denver Community Warms Hearts with their Glove Stories

In December, DW distributed more than 300 pairs of gloves to companies throughout the Denver community. We asked recipients to give the pair of gloves to someone who needed them. We also setup a website where people could go to share their Glove Story. The response was astounding and the stories have warmed our hearts. Here are just a few of the stories we have received…

Virgil Gooselaw of Retired United Pilots Association wrote: “The gloves were given to our next door neighbor. She is a mother of 3 small children and the husband is a painter and does not work consistently since the weather has gotten colder. She was very appreciative of the gloves and said she could use them.”

An Anonymous Contributor wrote: “I think the spread the warmth idea with gloves for those who need them is wonderful. I left the decision of giving the gloves up to my four-year old son. He kept them in his jacket pocket for several days. On New Year’s Eve night, during the celebrations in the street, my son decided to give the gloves to a little girl his age, a complete stranger, who didn’t have gloves and not enough warm layers on her. I remember my son saying, ‘you must be cold … here.’ It was a great, proud moment for me as a dad.”

Georgia Brown of American Water Works Association wrote: “At first, I didn’t know what to do with the gloves. They sat in the box on my desk for a couple days. Then it hit me! I put them in my purse and carried them with me for about a week. Admittedly, I used them a couple times, but on a cold day, I pulled up to a stoplight and there was a woman panhandling for money. I asked if she wanted them and sure enough, she did. I smiled the whole way home.”

Download a PDF of all the Glove Stories here or visit our website to learn more about our Spread the Warmth campaign at www.DWMailLLC.com.

Tax on Postage Update

The Colorado legislature has passed a package of tax changes in an effort to close a $1.5 billion budget shortfall. This includes a tax on cooperative direct mail advertising, which goes into affect March 1, 2010. Cooperative direct mail advertisements are advertisements that are bundled together for mailing, such as Money Mailer or Valpak. The bill does not place a tax solo mail such as self-mailers, postcards, brochures, etc… While the bill has no affect on DW Mail or the services that we provide for our customers, we continue to work with local and national associations to protect the tax-free status of direct mail and to educate lawmakers about the benefits of direct mail.

DW Welcomes Steven Kern

We excitedly welcomed Steven Kern to our sales team on January 18th. With Steven’s background in selling both print and campaign management, we continue to expand our expertise. We are not just a letter shop anymore, check out our website to learn more about how we can help you grow your business.

USPS Ends FY 2009 with a $3.8 Billion Loss

While $3.8 billion sounds bad, it could have been a lot worse if Congress had not make a last minute decision to defer a $4 billion payment to prefund future retiree health care costs.

Both the USPS and the Mailing & Fulfillment Service Association (MFSA) have concluded that the recession took a severe toll on the USPS in FY 2009.

In fact, mail volume plunged by 12.7% or 25.6 billion pieces in FY 2009. Declining mail volume is not the only cause for the USPS’s struggles.

The Congressional requirement that the USPS deposit $55.8billion to prefund retiree health care costs by FY 2016has significantly worsened the USPS’s financial situation.