First-Class and Standard Mail Down in Q1 2008
Monday, February 04, 2008; Posted: 05:47 PM

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Feb 04, 2008 (min's b2b/Access Intelligence via COMTEX) -- ARBU | news | PowerRating

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| PR Charts -- Pieces of first-class mail serviced by the United States Postal Service declined by 3.9% in the first quarter of 2008 v. the first quarter of 2007; standard mail decreased by 2.6%. So, what does this have to do with you, the B2B publisher? As opposed to periodicals, first-class and standard mail cost less to serve for the USPS than the price the USPS charges the consumer. Essentially, the less revenue the USPS takes in from first-class and standard, the smaller the shortfall from servicing periodicals needs to be. And, since the USPS has to be solvent, periodical rates are liable to go up when that happens.

Most disturbing, according to David Straus, counsel to American Business Media and postal affairs guru, is that both standard and first-class declined. First-class has been experiencing a prolonged decline, but it had been bolstered by increases in direct mail. Not so this time around.

So, what happens if first- class and standard volumes continue to decline?

"I think that use of 'if' is unduly optimistic," Straus says. "Standard mail may fluctuate with the economy, but I think that the overall trend will not be upward, and everyone knows that first-class will continue to decline. Two things will happen: Other classes will be required to pay more of the overhead costs now paid by first and standard, but remember the price cap, the application of which will not permit this to happen to any great extent; and the Postal Service will have to figure out how to downsize or otherwise cut costs. This will prove difficult, since Congress seems to jump in whenever the Postal Service tries to do anything about its network or its labor costs."

min's b2b, Vol. 11, No. 5

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