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A Time to Innovate

January 18, 2006

The Byrds sang a song in 1966, with verses borrowed from the Book of Ecclesiastes, which talked about a time and season for everything. After four years of stable postal rates, it now appears a new verse is in order for the mailing industry – a time to innovate.

It’s been pretty easy to forget that it has indeed been four years since our last major rate case. However, here we are with a 5.4 percent increase effective January 8 and a new rate increase looming for 2007. The next question is: are you ready to innovate again?

I’m not talking about creating new sortation levels, negotiated service agreements, or niche classifications. Let’s face it, few of us have the millions of dollars it takes to litigate an NSA. However, we can all take a fresh new look at our current processes and find ways to shave a few fractions of a cent here and there and those fractions can all add up.

Here are a couple of ideas to share.

  • Strive to improve address assignment by reviewing the error/status codes from your CASS Certified™ software. Often, it may just be a few pieces of information missing or an obviously misspelled word that is preventing the address from getting assigned. Consider splitting the output of your list into categories for further steps to increase address assignment. Also, look into services like Address Element Correction or Advanced Address Correction. These are services provided by the USPS® and service bureaus.
  • Consider adding more value added services to your customer. Many software products now have integrated services such as NCOALink™ and LACSLink™ (911 Address Conversion Matching Tool) that can improve your overall mail deliverability. By offering these services, you create a more streamlined solution to your customer and can provide a more just-in-time solution.
  • Review your production methods. I’ve heard of printers and mailers who were able to improve production rates simply by changing their package and container mail flow.
  • Is it time to consider expanding your business? Comailing and copalletization are hot topics right now and there are a lot of savings to be had if done properly. Maybe now is the time to start looking into consolidated drop shipping and earn additional postage discounts. Many of these questions can be answered again by running scenarios often using the same software you have now.
Again, these are just some sample ideas. I would really like to hear your ideas, too.
Posted by Chris Lien - Wednesday, January 18, 2006 at 12:03PM | Comments7 Comments

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Reader Comments (7)

Chris - I apologize for this personal comment, but as President of Firstlogic, I wanted to extend my thanks to you and the entire Firstlogic Commercial Mail Team for investing the time and effort into this excellent Blog. It once again demonstrates your passion and devotion to keeping our customers well informed and maintain your position as mailing industry thought leaders. Great job and thanks!

Eric Lieberman, President, Firstlogic, Inc.
January 18, 2006 | Eric Lieberman
I applaud you for providing a forum for idea exchanging on topics other than software.

To your point on address quality, one of the most under used services available is the Address Change Service. Too many people will run NCOA once a year (maybe) and than not keep their addresses current. ACS is a great service to take advantage of. And with the current rates the price difference in $0.54 per correction between an electronic vs. manual correction.

If a 100,000 pc. mailing has 3% with moves that's 3,000 names.

3,000 names at $0.54/ea. is $1,620.00!!! That doesn't even factor in lost sales or life time value of a customer.

ACS is easy and best of all a free service. What's not to like.

Todd
January 18, 2006 | Todd Kintopf, Royle Printing
Is anyone using the mail tracking service using PLANET codes on a regular basis? This seems like a great value-added service at an affordable price. Customers are always asking us "when did it get there?"
January 18, 2006 | Teri Rye, Consolidated Mailing Corp
UAA Mail… what a waste.

The Postal Service has been working on this problem since FirstLogic released its first CASS software in 1988, without success. The time and money spent on UAA mail by the USPS can certainly be put to better use. Unfortunately the postal bureaucracy always seeks out solutions that are the most difficult and expensive to implement, maintain and manage.

Address quality is no exception. The concept of mandating and then testing to insure compliance is the most costly and ineffective means of improving address quality. It requires expensive programs, hardware and software purchases to verify compliance and massive training budgets for postal employees. The simple cost effective solution for the Postal Service to resolve the UAA problem will not be found in prevention, it will be found in rule changes. To eliminate the costs associated with UAA mail the Postal Service only needs to eliminate the forwarding of First Class reduced rate mail. Most NSA’s include this no-forwarding feature. In fact this aspect of most agreements is where the Postal Service is able to show a cost savings justifying the NSA. The Postal Service is preparing a new rate case as we speak. All they have to do is extend the cost savings achieved in NSA’s to all mail. If a customer wants their mail forwarded or returned, the USPS would charge a fee that covers the cost of these services. All mail claiming discounts should be one-way mail. It would either be delivered to a mailbox or postal dumpster. UAA mail could be eliminated from processing as soon as the Postal Service realized that it couldn’t be delivered, saving transportation costs and further processing.

Customers that continued to send UAA mail would and should bear the total cost of the extra handling needed to deal with this problem. How many pieces of UAA mail would a corporation be willing to enter into the mail stream if the cost of forwarding was $2.00 each? How hard would they work at verifying address information if the Postal Service was unwilling to deal with the fruits of their ineptitude. What if the new forwarding systems generated reports for customers and mailed the report to the return address on the envelope? How many weeks do you think it would take to clean up this problem if the people causing it had to pay for it.

The Postal Service would still need to assist customers with CASS information, NCOA information and many of the other data services their customers need to correct address information but the Postal Service would no longer care if people used them.

Todd Butler
Butler Mailing Services, Inc.
January 18, 2006 | Todd Butler
Chris,

Congrats. on your new blog. Hope it provokes good commentary. In regard to the list hygiene side, we are having great luck selling expanded list cleaning services, including deceased file and "Do Not Mail" file matching. These 2 attributes can contribute 10% to 20% matches. Most customers are totally unaware of the waste to be found in these categories.

There are some very good service providers who bundle these services along with NCOA and it is worthwhile to consider offering these valuable add on's to NCOA. Your customer will thank you and pay you handsomely.

Tom Bush
Accurate Response.
January 18, 2006 | Tom Bush, Accurate Response
Teri,

In regards to PLANET codes...we have just started using them for one of our customers. I guess I was just naive about the fact that the USPS strives to get the mail delivered in a timely manner. I have one job that dropped on 11/29/05 that received scans 29 days after the mail was entered into the mail stream. I think PLANET codes are great and we need to hold the USPS's feet to the fire for delivery times.
January 19, 2006 | Ray Briggs - BZ Mailing Services
We just began testing the use of PLANET codes and have had our eyes opened as well. Our first test was a Standard Flat mailing. The first scans came 5 days after the mail was inducted into the mail stream. Today is the 6th business day and the scans are slowly trickling in. The pieces from 5 digit bags are being delivered today, while other less specific bags have not received their first scan. This will provide valuable information to take to our customers as well as information to discuss with our postal reps.
January 23, 2006 | Teri Rye, Consolidated Mailing Corp

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