How Postal Rates are Charged
In the ever-evolving world of postal optimization, the United States Postal Service (USPS) has continued to make changes and updates to its pricing, distribution, and promotional offerings. Let's explore the latest updates from USPS and gain a high-level understanding of postal rates and the structure of how they are charged.
Requirements for Postal Sortation Qualification
The USPS offers customers the opportunity to sort their mail at discounted rates instead of relying on USPS to manage the sorting process. The extent of the sorting achieved by a customer directly influences the overall postage costs incurred. The higher the level of sortation accomplished, the lower the postage charges. The effectiveness of achieving sortation levels that minimize postage costs is contingent upon the destination of the mail pieces and the volumes being sent to those specific destinations.
Letter mail is categorized into the 5-Digit scheme, bypassing the Basic Carrier Route level. This approach is dictated by USPS's automated equipment, which efficiently sorts mail at the 5-Digit level while avoiding mail bundling at the carrier-route level. Elevated postage costs associated with Carrier-Route Letters discourage the use of such mail. Opting to sort letter mail to HD, HD Plus, or Saturation levels offers advantages; however, this accomplishment is challenging without significant mail volumes. Enhanced sortation levels are the driving force behind cooperative mailing initiatives such as co-mail (for flats and periodicals) or commingle (for letters), making them integral components of any mailing strategy.
The USPS extends discounts from base rates when mailers coordinate the delivery of mail directly to USPS facilities at the destination, as opposed to dispatching it from their own locations. This practice is referred to as destination or drop ship entry. To determine its viability, the mailer assesses the mail's destinations and calculates whether the USPS postal discounts outweigh the added freight expenses associated with transporting and depositing the mail at USPS facilities at the intended destination.
Starting from the highest to the lowest entry levels, originating mail is straightforward but does not entail any discounts, as USPS assumes responsibility for shipping the mail pieces to their destinations. Gradually escalating discounts are provided for entry levels such as NDC, CSF, and DDU. However, achieving DDU entry can be challenging unless there's a significant volume of mail destined for a specific regional area. Most larger mailers typically opt for SCF-level entry.
Enru’s Postal Optimization experts can show you how to take advantage of USPS discounts and co-mail opportunities to see greater postage savings! We are offering, for a limited time, a FREE postal check-up on your mailing list to see if you are maximizing your savings. Contact us today to get started!