24-hour earlier receipt of payments will increase a company's annual net income by 1%, according to Gallup/Pitney Bowes study of financial executives; Classification reform provides opportunity for business to increase cash flow and net income.

STAMFORD, Conn.--(BUSINESS WIRE)--June 11, 1996--Vice presidents and directors of finance at large and mid-sized U.S. companies said that if they receive receipts or payments one day earlier their company's annual net income or operating profit would increase by an average of 1%.

Furthermore, over 11% of these executives said net income would jump 5% if payments could be received a day sooner in a given year. This is a major finding of the Gallup/Pitney Bowes Billing and Payment Study.

The study was commissioned by Pitney Bowes Mailing Systems, the word leader in mailing technology and processing.

The Gallup/Pitney Bowes Study also found that at least 88% of U.S. companies polled currently use the mail to deliver their bills, invoices and statements, as well as collect their receivables/cash receipts. The average large to mid-sized U.S. company reported that it receives 4.6 million cash receipts through the mail each year.

"Mail is U.S. business' most critical cash flow delivery system," said Tom Shimko, vice president, Marketing, Pitney Bowes Mailing Systems. "However, most companies don't realize that they can improve their cash flow by just improving the way they prepare the mail. In fact, Classification Reform, the most massive changes ever to business mail will be implemented on July 1, 1996, and actually reward mailers with faster delivery and postage discounts up to 18% for automating the preparation of mail. Even more important, speeding up the delivery of mail can have a profound effect on net income and profits."

The USPS Classification Reform will affect First-Class, Second-Class, Third-Class and Fourth-Class mail and reward mailers who prepare mail for automated processing. Mailers now paying 32 cents for a First-Class letter can reduce their postage to 26.1 cents or less by conforming with USPS address quality standards, printing the delivery point barcode, mailing in quantities of 500 or more pieces in trays, and by performing minimal pre-sorting.

The U.S. Postal Service has reported that mail is properly addressed with delivery point barcodes and pre-sorted can bypass many of the post office handling steps and be delivered up to 24 hours sooner, compared to mail lacking automated preparation.

According to Shimko, "the first step to automate the mail center is to invest in PC-based software and addressing hardware that verifies and cleanses mailing lists, applies the delivery point barcode, and automatically pre-sorts mailings. Companies should also provide a business reply envelope with a delivery point barcode to ensure that payment is delivered in the fastest possible manner." Shimko also said, "tremendous time and postage savings are just some of the benefits that can be gained by also investing in mail preparation and finishing systems that fold, insert, meter, and, then finish the mail in the quickest possible manner."

The study also revealed that while other billing (EDI and E-mail) and payment (EFT and direct deposit) channels have and will continue to grow, mail will continue to be the mainstay for carrying cash flow (83% - billing; 55% - payment three years from now) and it will continue to be a major part of the communications or messaging mix.

The Gallup Organization conducted the Billing and Payment Study in December, 1995 through random telephone interview sampling of 113 Dun & Bradstreet mid-sized companies (100-499 employees), and 137 Dun & Bradstreet large companies (500+ employees) in the U.S. Data was weighted to represent the correct proportion of mid-sized and large company populations.

The average annual sales of the companies polled was $60 million.

Additional information about Pitney Bowes products and services is available through its local district offices or its home page on the Internet: http://www.pitneybowes.com.

Pitney Bowes is a premier provider of products, services and technologies that enable customers worldwide to efficiently manage the exchange and distribution of information and packages.

For more information concerning the Gallup/Pitney Bowes Corporate Billing and Payment Study, please call Scott Tangney at 212/684-6300, ext. 313.

CONTACT: Scott Tangney

212/684-6300, ext. 313