The U.S. Postal Service filed notice with the Postal Regulatory Commission (PRC) of their intent to raise market dominant postage rates by 1.5%. The PRC will review to validate the proposed changes are equitable. If they approve, new rates would be effective January 24, 2021. It is likely the new rates will be accepted, and we should know the verdict by Thanksgiving. There is good news for direct mail letter mailers, including non-profit letter mailers.
Snapshot and notes of rate filing for mail services
Mailing Services prices increases are commensurate with the Consumer Price Index.
General increase
1.5%; excludes package services
First-Class Stamp
Will remain unchanged at $0.55; postcard stamps go up one cent from $0.35 to $0.36.
First-Class Automation Letter rates
Will increase 1.55%
First-Class Automation Post Card rates
Will increase 3.35%
First-Class Automation Flat rates
The first two ounces will see a dramatic increase of 12.9%, while the overall average across all weight limits is 3.07%. Although the lower overall average is substantially less, it provides little relief as most flat-size mailers fall in the much higher-cost lighter weights.
Standard Mail Automation Letter rates
Modest average increase coming in at 1.17%
This is good news as this is a widely used rate category for direct mail.
Standard Mail Carrier Route Letter rates
Will see a slightly higher than the 1.5% overall general increase, with the average at 1.69%.
The finest depth of presort categories, Saturation and High Density Plus rates will not see an increase.
Mailers who can considerably increase volume per mailing will benefit.
Non-Profit Automation Letter rates
A slight break here, as the overall average increase comes in at 1.41%
Non-Profit Carrier Route Letter rates
Good news for do-good mailers! Postage increase for high volume non-profit letters will be less than 1%, coming in at an average of .85%.
Proposed Flat Rate price changes
Standard Mail Automation Flat rates
This comes in way above the 1.5% with the overall average in this category, at 5.45%.
The higher percentage increase signals that the USPS is still struggling to cover processing and delivery costs associated with flat-size pieces, as mandated by law.
Standard Mail Carrier Route Flat rates
This category will see an average increase of 2.19%. Like its letter-size counterpart, flats in the Saturation, High Density rates do not get an increase. Companies mailing flats will benefit from producing larger individual mailings.
Non-Profit Automation Flat rates
Like with the other flat-size classifications, non-profit flats will see a 3.38%, average increase.
Non-Profit Carrier Route Flat rates
Good news here as high volume/high density mailings will see an average increase of 1.44%.
Marketing Parcels rates
Marketing parcels are generally used for advertisements, flyers, catalogs, and product samples. As the USPS manages greater volumes of all parcel mail, there will be a huge increase here. Albeit, much lower than any other available parcel rates. The increase averages 16.91%.
Package Services
Considered competitive products, package services prices are adjusted according to market conditions and will see steeper increases.
*There is currently a temporary rate change is in effect until the December 31, 2020.
2021 Promotions are looking similar to last year, and we will update as we learn more.
