The U.S. Postal Service has reduced postage rates for regular mail for the first time in almost a century. First-class letters have dropped from 49 cents to 47 cents, postcards went down a penny to 34 cents and certified mail has decreased from $3.45 to $3.30. The reduction stems from the Postal Regulatory Commission (PRC) lifting the “exigent surcharge,” a temporary price hike implemented in 2014 to help with the Great Recession.
Postal Service managers have already asked Congress to cancel the mandated reduction, arguing it will add $2 billion in annual losses. “Given our precarious financial condition and ongoing business needs, the price reduction required by the PRC exacerbates our losses,” Postmaster General and CEO Megan J. Brennan said in a statement.
Without funding from taxpayers, the Postal Service must generate its own revenue. This reduction may require recalibration of office postage machines. For people who purchased Forever Stamps at 49 cents, they’re losing 2 cents of value for each one they own.
For companies in the promotional products industry, however, the postage rate reduction could add up to significant savings. “On smaller orders, in particular, we can see where the Postal Service would be a good option,” says Jim Franklyn, vice president of sales and marketing at InkHead Promotional Products (asi/231159). “We also send hundreds of samples a year via the post office and ship the majority of the international, military and government orders through the U.S. Postal Service.”
Another distributor, Children’s World Uniform Supply (asi/161711), has a contract with the U.S. Postal Service allowing for a post office inside the company’s retail store. Owner Tim Holliday says the post office provides solid foot traffic because people who wouldn’t normally enter the store now have a reason. The prices for stamps or shipping packages are the same as all of the other post offices – it’s just more convenient for customers and business. “It’s surprising that they took away the price hike already, but it won’t change anything for us,” Holliday says.
After shipping rates were increased in January, shipping rates for packages and priority mail are not being reduced at this time.