On May 14, the U.S. Postal Service enacted shape-based postage. For the first time, postage rates reflect the fact that certain types of mail require higher processing costs. First-class mail will see an average increase of 7% across the board, but postage rates for certain classes of mail, flats and parcels, will rise sharply—as much as 40% to 60%.

Yes, the impending rate change will carry a certain degree of sticker shock. At the same time, the new system includes pricing incentives to encourage mailing efficiency. Businesses thus have unprecedented opportunity to reduce the impact of the new pricing system.

Educate executives on shape-based pricing.

Under the new system, several variables determine mail piece classification—and postage rate. Deciding whether or not to fold a document changes a mail piece from a letter to a flat—a choice that can increase postage by 39 cents, or 67.2%, for a two-ounce piece.

Executives need to understand the basic changes of the new system, such as:

• Weight limits by class
• Thickness limits by class
• New rule on uniform thickness
• New rule on flexibility

This briefing should compare current rates to the proposed rates, using examples relevant to the organization to show how small changes in packaging add up to big savings.

Consider total impact of the revised pricing.

Companies need to consider every aspect of a mailing for an accurate cost comparison. For instance, an envelope that downsizes a parcel into a flat may cost five cents more, but save up to 39 cents on postage.

Businesses should also consider the inventory costs of mailing supplies. For example, new envelope technology gives a single envelope size versatility to hold a wider range of content. This packaging may cost more than conventional envelopes, but enable firms to purchase fewer envelope sizes.

Companies increase storage efficiency by decreasing the number of different envelopes maintained in inventory. At the same time, businesses qualify for deeper volume discounts by buying larger quantities.

Research packaging supplies and current usage.

In addition to analyzing the present mailer inventory, companies should monitor how supplies are used. Some departments use 9x12" envelopes to mail statements and brochures because of the aesthetic appeal. Now, however, that preference costs 39 cents more per piece than it did before the change.