Head It and Weep; Post Office Delivers Crushing Blow to Direct Mail Industry

The U.S. Postal Service raised the price of a firstclass stamp from 25 to 29 cents on Sunday, February 3, an increase of 16 percent. Lost in the shuffle, however, was the fact that the increases for second- and thirdclass mail, rates of particular interest to business, are in actuality, subsidizing the first class rates, because they increased at a steeper rate The average price of second-class mail went up 22 percent, and the price of third-class mail increased 25 percent. Area mailers were somej, what alarmed by the rate in' creases. "This one's a little scary, only because it's so high," Economy Mailing Service president Don Addison said. "It's going to have a negative impact on volumes," P. J. Green president Jerry Farnsworth added. What are the mailing options for local companies? Some area mailers recommend using new equipment to better presort mail. David Osborne, president of Lettergraphics, said he readied for the rate increases by acquiring new machinery. "We are prepared for them. We have the equipment to enable us to take advantage" of the situation. The new equipment, Osborne said, will be able .to read previously "unreadable addresses," assign carrier routes and add zip + four codes for barcoding. Tom Delias, president of Delias Graphics, said that the latest in technical advances would facilitate processing mailing lists. "With large mailings, many companies give a (computer) disk or tape to a mailing service, where they'll put carrier routes, barcodes, walk sequences for carriers, and zip + four codes. The more businesses presort, the more they'll save." Taking advantage of postal discounts through thorough planning, is what area mailers, almost to a
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^continued from PAGE 1 _ man, advise businesses. Bill Keyes, production superintendent at Scotsman Press and secretary of the Greater Syracuse Postal Customers Council, said that groups which do their own mailing should contact the Post Office and professional mailing services to learn about discounts. "Discounts are available, but they need to work at it," Keyes said. "Discounts are definitely geared towards presorting. The more work you do, the moro dwconnt.H you get."
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see who bought dresses last year, and just send those mailings out to them." Delias said, "With the new regulations we'll be sorting finer. The smart mailer won't see an increase in postal rates.. .With a recession, people are going to direct mail to a target market much better. They'll reach fewer people, the ones more likely to buy, instead of doing blitzes on radio and TV." Farnsworth said the trend is towards "mailing smarter, not less necessarily. There's going to be more targeted promotions, as companies learn how to use the system." Politically, local mailers
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beyond me how a business can raise its prices by (25 percent). But that's what we've got here, with a monopoly. They should be locked in, so that they can't raise prices faster than inflation. What justifies a (25 percent) increase?" In its January 1991 "Memo to Mailers," the Postal Service told the public that it remains committed "to keeping future postal rate increases below the rise in the rate of general inflation," and reminded the reader that during 1990 it kept costs at a level two percent below the rise in the rate

of inflation
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' ing lists even further, in order to get as much bang for the ever precious buck. Mike Faber, credit manager at Chappell's, said, "We can control who we mail to. If we used to send out 40,000 mailings on dresses, we can now check the records and

Addison, who said that whenever he raises his prices by as little as five percent, his customers gripe, was angered at the cavalier way the U.S. Postal Service raised the rates. "They've been slow in notifying companies on what's going on.. .It's just

creases are excessive I hope that there will be a rollback to saner and more effective rates. "As a professional mailing concern, all we can do is offer discounts to our customers to mitigate the exorbitant, unjustified rate increases." 4