Sticker Shock

Dead Tree Edition


Thursday, March 5, 2015

Sticker Shock: Size of Postal Increase Stuns Publishers

March 6 update: The PRC sent the proposed Standard, Periodicals, and Package Services rates back to the Postal Service for revisions and clarifications. Here’s the PRC press release.Although the April postage hike for Periodicals will supposedly average only 1.4%, some publishers are learning that their increases will be 10 times that amount.The biggest rate increases will probably hit relatively lightweight publications that contain little or no advertising, such as weekly magazines and association newsletters. Some other publishers, however, will probably see lower postage bills.Projections for nine leading nonprofit publications show increases ranging from 3.4% to 16.2%, with all but three above 8%, The Alliance of Nonprofit Mailers wrote this week in an alert sent to its members. Although the U.S. Postal Service announced the new rates nearly two months ago, the alliance noted that publishers could not calculate how the rates would affect them until recently, when USPS spelled out some new mailing rules changes that will accompany the new rates.

Such large postage hikes are “likely to force many of these newsletters and magazines to discontinue mailing, or reduce the frequency of their publications, and look elsewhere to achieve their very important mission,” the alliance wrote.

“We believe that the Postal Service did not intend to impose such large increases on important nonprofit publications, and that the increases are unintended collateral effects of a larger, complex pricing strategy for Periodicals,” the alert said. It added that the alliance is trying to get USPS to amend its rate proposal.

For Periodicals and several other types of mail, the new rates place less emphasis on weight-based charges and more on other factors that have a more direct impact on USPS costs. That’s good news for hefty fashion magazines and some types of letter mail, but not so good for mailers that aren’t paying much for weight to begin with.

The Postal Service itself has been thrown off by the complexity of its own changes in rates and rules for the Periodicals class. It intended for the average Periodicals increase to be nearly 2%, but has adjusted the calculation to 1.4% after acknowledging calculation errors pointed out by the Postal Regulatory Commission.

And recent questioning from the PRC indicates it may still not be satisfied with the Postal Service’s calculations.