August 28 price increase for First Class Parcels – announced with USPS 2017 Promotions

05/18/2016

The Postal Service has filed a request with the Postal Regulatory Commission for a First Class Parcel rate hike effective August 28, 2016 along with the 2017 Promotion Program.

http://www.prc.gov/docs/95/95896/Combined%20Notice_FINAL.pdf

The USPS had previously stated in public meetings that they did not plan to file any rate adjustments that would be implemented prior to January 2017. When discussing price matters such as Move Update assessments or any changes to FSS pricing, they again implied no price adjustments until January 2018.

The proposal is to move the rate for First from $2.60 to $2.62.

While limited to First Class Parcels, the break in the usual cycle should be noted and watched – a few questions come to mind:

  • Could it be an indicator of the approach in the future?
  • If the approach is replicated, what is the impact to the budget process for mailers?
  • If out of the typical cycle, how do software providers plan?

It is also important to note the verbiage regarding the Unused Price Adjustment Authority throughout the filing:

“The existing unused rate adjustment authority for the First-Class Mail class is 0.074 percent.3 The existing unused rate adjustment authority for the Standard Mail class is 0.104 percent.4 The Postal Service will not utilize any of its unused price adjustment authority in this docket.”

Below is the public announcement distributed by the Postal Services Industry Alert process.

Industry Alert

 

USPS Notice of PRC filing – 2017 Promotions and First-Class Mail Parcels

The Postal Service filed a request with the Postal Regulatory Commission to establish the 2017 Promotional Program in addition to adjusting certain prices in the First-Class Mail Parcels product.  The proposed price adjustment does not constitute the Postal Service’s annual, general Market-Dominant price adjustment, which is typically filed in the fall of the year.

If approved by the Commission, the revised First-Class Mail Parcels prices will take effect on Aug. 28, 2016.  The first of the 2017 promotions will begin Jan. 1, 2017.

2017 Promotional Program

The promotions are designed to encourage all marketers, printers, and mailers to utilize new technology and tools that leverage and increase the value of a physical mailpiece.

  • The proposed 2017 promotional offerings are:
    • Emerging and Advanced Technology
    • Mobile Shopping
    • Tactile, Sensory & Interactive Mailpiece Engagement
    • Earned Value Reply Mail
    • Personalized Color Transpromo
    • Direct Mail Starter (New) – This offering will give a temporary postage discount on mailpieces that contain print-mobile technology that, when scanned, leads the recipient to a mobile-optimized website.

First-Class Mail Parcels and Inbound International First-Class Mail Letter Post

This filing will correct the price imbalance between First-Class Package Service and First-Class Mail parcels by slightly increasing prices for all pieces that weigh up to three-ounces to $2.62.

Prices for Inbound International First-Class Mail Letter Post (Inbound Letter Post) are set by the Universal Postal Union (UPU) and are implemented every January, and went into effect Jan. 2016.

Note: All new prices will be posted on the Postal Explorer website: http://pe.usps.com . The complete Postal Service price filing, including the new prices, can also be found on the PRC website under the Daily Listings section:  http://www.prc.gov/dockets/daily. The Postal Service receives no tax dollars for operating expenses and relies on the sale of postage, products, and services to fund its operations.