USPS Proposes Flexible Pricing Tests

The U.S. Postal Service Board of Governors (BOG) on Sept. 6 put its money where its mouth has been. The BOG said it had approved the filing with the Postal Rate Commission (PRC) for two flexible pricing initiatives designed to enable the USPS to alter its pricing structure under existing law. Both were extracted from the Transformation Plan that the BOG endorsed earlier this year.

The USPS wants to test a negotiated service agreement (NSA) with its largest producer of first class mail, Capital One Services bank. The agency also seeks PRC approval to test a classification for co-palletized periodicals. Although neither proposed test involves catalogers, both could affect mailers down the road.

NSAs would enable the Postal Service to adjust what it charges commercial mailers based on such factors as volume and weight. Not only can NSAs potentially lower some bulk mailers’ rates, but they can also improve efficiency and increase revenue for the USPS. As for the other proposal, which would grant postal discounts to magazine publishers that co-palletize their books, success of such a test could lead to it being applied to catalogers.

Although the proposals drew kudos from postal watchdogs contacted, Association for Postal Commerce president Gene Del Polito tempers his enthusiasm. “We’re treading on untested ground here,” he says. “Everybody’s talked about these things, their conceptual appeal and practicalities, but they could all of a sudden turn out not to work from day-to-day operational experience. It could be discovered that there is an unanticipated change in postal operations that causes complications or some other wrinkles could get in the way.”

Despite his caution, Del Polito praises the USPS for its choice of a bank for its test subject. In recent years, banks have led the charge out of the mailbox and onto the Internet, stripping the Postal Service of first class mail volume in the process. Based on the success of the test with Capital One, “other banks may feel they can qualify under other circumstances and conditions, and that may be good for the Postal Service,” Del Polito says.

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USPS proposes flexible-pricing tests

The U.S. Postal Service Board of Governors (BOG) on Sept. 6 put its money where its mouth has been. The BOG said it had approved the filing with the Postal Rate Commission (PRC) for two flexible pricing initiatives designed to enable the USPS to alter its pricing structure under existing law. Both were extracted from the Transformation Plan that the BOG endorsed earlier this year.

The USPS wants to test a negotiated service agreement (NSA) with its largest producer of first class mail, Capital One Services bank. The agency also seeks PRC approval to test a classification for co-palletized periodicals. Although neither proposed test involves catalogers, both could affect catalogers down the road.

NSAs would enable the Postal Service to adjust what it charges commercial mailers based on such factors as volume and weight. Not only can NSAs potentially lower some bulk mailers’ rates, but they can also improve efficiency and increase revenue for the USPS. As for the other proposal, which would grant postal discounts to magazine publishers that co-palletize their books, success of such a test could lead to it being applied to catalogers.

Although the proposals drew kudos from postal watchdogs contacted, Association for Postal Commerce president Gene Del Polito tempers his enthusiasm. “We’re treading on untested ground here,” he says. “Everybody’s talked about these things, their conceptual appeal and practicalities, but they could all of a sudden turn out not to work from day-to-day operational experience. It could be discovered that there is an unanticipated change in postal operations that causes complications or some other wrinkles could get in the way.”

Despite his caution, Del Polito praises the USPS for its choice of a bank for its test subject. In recent years, banks have led the charge out of the mailbox and onto the Internet, stripping the Postal Service of first class mail volume in the process. Based on the success of the test with Capital One, “other banks may feel they can qualify under other circumstances and conditions, and that may be good for the Postal Service,” Del Polito says.

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Being prepared for the holiday rush used to mean stocking shelves and making sure your associates were ready for the long hours. But the digital revolution has changed everything, most importantly, customer expectations. Retailers with a physical store presence should be asking themselves—what am I doing to wow the customer?
3 Critical Components to Achieving the Perfect Order - NetSuite
Explore the 3 critical components to delivering the perfect order.
Streamlining Unified Commerce Complexity - NetSuite
Explore how consolidating multiple systems through a cloud-based commerce platform provides a seamless experience for both you, and your customer.
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