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Sorting through mail costs.

In the first phase of its classification reform, which went into effect July 1, the U.S. Postal Service made sweeping changes that affect every business mailer in the country. The most important difference for first-class and standard mail (previously called third-class) is the increased discount for using delivery point barcodes, but there are other dollarwise strategies businesses should know about. While some of the new automation discounts will benefit enterprises frequently mailing 500 pieces of mail, there are ways for smaller businesses to save money and expedite delivery.


Here are some of the ways to take advantage of automation discounts, plus other cost-saving suggestions.

* Meter and barcode your mail. Automation is the underlying theme at the USPS. Mail that's been metered and barcoded will reach its destination sooner because it will bypass several steps within the post office. Depending on the number of pieces being mailed, there's also a tremendous opportunity to reduce postage costs because of lower rates available to barcoded mail.

* Consolidate materials into one envelope. Mailing several different pieces to one client isn't the most cost-effective approach. Consolidating mail cuts costs because it's cheaper to pay $0.23 per extra ounce in a heavier package than to send an additional envelope at $0.32.

* Redesign mail to conform to letter size. Many businesses rely on promotional mailings to distinguish themselves from the competition. CPA firms often send these items plus tax returns, periodic newsletters and monthly billing statements in larger envelopes called fiats (the technical term is "nonletters"). To save money, consider folding this material instead to fit into "letter" envelopes that meet USPS automation size requirements (minimum 3" X 5"; maximum 6 1/8" X 11 1/2" and a maximum thickness of 1/4"). For example, 6" X 9" envelopes have become very popular for business mailers. Letters can be less expensive than fiats and may qualify for automation discounts. To learn how to qualify for discounts, contact your local U.S. postal service account representative.

* Use postcards when possible. Instead of paying $0.32 for a regular envelope, is it possible to put your message on a postcard and pay $0.20? Besides saving $0.12 per piece, postcards offer these benefits:

1. Low related expenses. There are no envelopes, no enclosures to insert and less staff time is needed to prepare a mailing.

2. Immediate impact. If the graphics are good and the message is appropriate, the recipient gets the idea without having to open an envelope.

3. Portability. Others beyond the addressee can easily see and read your message.

The proper dimensions for postcards are a minimum of 3 1/2" X 5" and a maximum of 4 1/4" X 6", plus a maximum thickness of .016".

* Eliminate return receipts. This is one of the best cost-saving tips, because return receipts often aren't necessary. Many mailers believe that certified/return receipt is one service. In fact, certified mail and a return receipt are separate services. The certified letter and return receipt cost $2.52 together, but a certified letter alone is $1.10. Many return receipts either aren't returned or come back without any signature, so this service may not really be needed. Certified mail provides optional proof of mailing and a record of delivery at the delivering post office. The USPS maintains a record of delivery at the delivering post office for two years. When it's really necessary to establish that something was delivered, it costs $6.60 to receive a return receipt after mailing. Using this option only occasionally rather than paying for return receipts all the time can save lots of money.


In order to cut expenses, it's important to understand what cheaper options work best. When CPA firms and their clients make use of the ideas discussed in this article, they can trim postage costs and help speed delivery.


* NEW AUTOMATION efforts at the U.S. Postal Service mean potential discounts for business mailers. Other cost-saving strategies can lower postage outlays and help speed delivery. Tips include

1. Meter and barcode mail to take advantage of automation-related reduced rates.

2. Consolidate materials into one envelope.

3. Redesign mail to conform to letter size.

4. Use postcards when possible because the postcard rate is cheaper.

5. Eliminate return receipts, which often are used out of habit rather than real need. Other less costly options can serve the same purpose. DAVID A. PINA is national postal education instructor at Pitney Bowes, Peachtree City, Georgia.
COPYRIGHT 1996 American Institute of CPA's
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1996, Gale Group. All rights reserved. Gale Group is a Thomson Corporation Company.

Article Details
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Author:Pina, David A.
Publication:Journal of Accountancy
Date:Nov 1, 1996
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