USPS: No Rate Hike in 2010

Catalogers planning their 2010 budgets received a big boost of good news Thursday as Postmaster General John E. Potter declared there would be no increase in prices for “market dominant products” during calendar year 2010.

Potter’s announcement came via a Domestic Mail Manual (DMM) advisory. “Many of you have expressed concerns regarding mailing costs for 2010,” he said. “The tough economic climate has presented significant challenges to all of us and pessimistic speculation has suggested that postal prices could increase by as much as 10%.”

“As we begin a new fiscal year and as many of you, our business clients, are preparing your 2010 operating budgets, we want to end all speculation. The Postal Service will not increase prices for market dominant products in calendar year 2010.”

Market dominant products include First-Class Mail, Standard Mail, periodicals, and single-piece Parcel Post. “There will be no exigent price increase for these products,” Potter said in the
advisory. “This is the right decision at the right time for the right reason. Promoting the value of mail and encouraging its continued use is essential for jobs, the economy, and the future of both the Postal Service and the mailing industry.”

While increasing prices might have generated revenue for the Postal Service in the short term, Potter noted that the long-term effect could stand to drive more mail out of the system. “We want mailers to continue to invest in mail to grow their business, communicate with valued customers, and maintain a strong presence in the marketplace.”

Mail volume declined by more than 28 billion pieces in fiscal 2009.

That’s not to say that U.S. won’t be hiking rates on any products, however. “Changes in pricing for our competitive products–Priority Mail, Express Mail, Parcel Select, and most international products–are under consideration,” Potter said. “We expect to announce a decision in November.”

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