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The DMA Applauds the USPS Decision to Examine Facility Consolidation.

The DMA Urges USPS to Examine All Options To Contain Costs;

Focus Attention on Legislative Reform

NEW YORK, July 10 /PRNewswire/ --

The Direct Marketing Association (The DMA) today applauded the United States Postal Service (USPS) Board of Governors (BOG) for agreeing to review consolidation of postal facilities in a move to contain costs. The DMA reiterated its support for the USPS to review all cost containment proposals, including legislative reform.

The DMA urged the BOG to critically examine all of its operations and expenditures immediately to avoid the acceleration of the downward death spiral of the USPS.

"There is no doubt that the Postal Service is facing a crisis that will significantly impact the economy as well as the future of the direct and interactive marketing industry, as well as the Postal Service itself," said H. Robert Wientzen, president & CEO, The DMA. "While elimination of Saturday delivery service has been a headline grabber, the truth is that for the Postal Service to remain viable, it must look at all areas of its business to find ways to continue to provide universal service in a more economical and efficient manner."

"In looking to stem the $.9 billion to $1.5 billion anticipated loss for this year, the USPS has to examine its budget, line-by-line, for all potential savings," said Edward Gleiman, former Chairman of the Postal Rate Commission, who is spearheading The DMA's campaign to enact postal reform legislation. "The Postal Service must redouble its cost-containment efforts and place all of its operating procedures and expenditures under the microscope. It is the only way the USPS can help curb future rate increases, as it waits for Congress to take action on this paramount issue."

MUCH-NEEDED POSTAL REFORM

The USPS is facing financial woes because it is operating under a set of laws passed in 1970 that charges it with acting in a business-like manner, but severely inhibit its ability to do so. In addition, the agency has suffered major fiscal setbacks due to fierce competition, recent technological communication advancements such as the increasing popularity of e-mail, as well as from the recent economic downturn.

As the postal reform leader, The DMA has formed an historic coalition, which includes labor groups and commercial mailers, which has presented an outline for sensible postal reform to Congress.

The DMA and its coalition partners have presented to Congress a legislative outline that creates incentives for USPS managers to contain costs. It will also allow the USPS to compete fairly with the technological changes and private carriers that are steadily gulping much of the USPS's customer base.

The DMA, which represents about 5,000 direct and interactive marketers worldwide, said the USPS's back-to-back postage rate increases this year have been devastating for many Internet and catalog-based companies who rely on the USPS to conduct business. A third rate increase, now in the works, could drive many companies out of business.

The DMA is the leading and largest trade association for businesses interested in interactive and database marketing, with almost 5,000 member companies from the United States and 53 other nations. Founded in 1917, its members include direct marketers from every business segment as well as the nonprofit and electronic marketing sectors. Included are catalogers, Internet retailers and service providers, financial services providers, book and magazine publishers, book and music clubs, retail stores, industrial manufacturers and a host of other vertical segments, including the service industries that support them. According to a DMA-commissioned study, direct and interactive marketing sales in the United States exceeded $1.7 trillion in 2000, including $110 billion in catalog sales and $24 billion in sales generated by the Internet. The DMA's Web Site is http://www.the-dma.org and its consumer Web site is http://www.shopthenet.org.

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Publication:PR Newswire
Date:Jul 10, 2001
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