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New Prices New Flexibility New Opportunities May 12, 2008

New Prices New Flexibility New Opportunities May 12, 2008. Postal Act of 2006 Mailing Services Shipping Services Resources. Agenda. New Prices – May 12, 2008. Two categories: Mailing Services with a cap Shipping Services with a floor Flexibility Predictability Choices

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New Prices New Flexibility New Opportunities May 12, 2008

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  1. New Prices New Flexibility New Opportunities May 12, 2008

  2. Postal Act of 2006 Mailing Services Shipping Services Resources Agenda New Prices – May 12, 2008

  3. Two categories: Mailing Services with a cap Shipping Services with a floor Flexibility Predictability Choices Speed-to-market Postal Act of 2006 New Prices – May 12, 2008

  4. First-Class Mail (includes First-Class Mail International) Standard Mail Special Services Periodicals Package Services Mailing Services New Prices – Mailing Services – May 12, 2008

  5. Consumer Price Index (CPI) cap 2.9% average increase by class Annual, predictable price changes 45-day notice required 90-day commitment Mailing Services New Prices – Mailing Services – May 12, 2008

  6. $38 billion revenue Average +2.89% First-Class Mail New Prices – Mailing Services – May 12, 2008

  7. Letter: 42¢ (+1¢) Forever Stamp Plenty of stamps on hand No more nondenominated transition stamps First-Class Mail – Single-Piece New Prices – Mailing Services – May 12, 2008

  8. Additional ounce: 17¢ (unchanged) Nonmachinable surcharge: 20¢ (+3¢) New 62¢ stamp for 1-ounce square envelopes such as greeting cards Postcard: 27¢ (+1¢) First-Class Mail – Single-Piece New Prices – Mailing Services – May 12, 2008

  9. Promote efficient preparation Maintain strong 2.2¢ incentive for 5-digit Presort letters additional ounce same price as for auto: 12.5¢ (- 4.5¢) First-Class Mail – Automation & Presort Letters New Prices – Mailing Services – May 12, 2008

  10. Align with domestic Shape-based pricing First-Class Mail International • Nonmachinable letter surcharge: 20¢ • Align country grouping with other international products New Prices – Mailing Services – May 12, 2008

  11. $21 billion revenue Average +2.84% Standard Mail New Prices – Mailing Services – May 12, 2008

  12. Price increase well below average Standard Mail Flats (catalogs) New Prices – Mailing Services – May 12, 2008

  13. Lower pound prices for saturation and high-density flats Standard Mail Flats New Prices – Mailing Services – May 12, 2008

  14. $2.2 billion revenue Average +2.72% Periodicals • Allow recent changes to settle in and work on efficiency • New, limited-circulation pricing New Prices – Mailing Services – May 12, 2008

  15. $1.8 billion revenue Average +2.88% Package Services New Prices – Mailing Services – May 12, 2008

  16. $2.7 billion revenue Average +2.85% Special Services • Certified Mail: $2.70 (+5¢) • Return Receipt: $2.20 (+5¢) • Annual Mailing Fees: $180 (+$5) • Delivery Confirmation: no change New Prices – Mailing Services – May 12, 2008

  17. Shipping Services • Greater pricing freedom and flexibility • No price cap • Each product and contract must cover cost • Must cover 5.5% of Postal Service overhead • 30-day notice required • 60-day commitment New Prices – Shipping Services – May 12, 2008

  18. Shipping Services • Priority Mail • International • Express Mail • Parcel Select • Parcel Return Service New Prices – Shipping Services – May 12, 2008

  19. New Price Structures and Incentives Price Lists • Retail prices • Commercial base prices • Commercial volume prices Negotiated pricing • Commercial contract prices New Prices – Shipping Services – May 12, 2008

  20. Express Mail • Average +3% • Sunday and holiday premium: $12.50 (introduced March 3) • Zoned pricing with competitive local pricing • Rename Post Office-to-Post Office as “Hold For Pickup” New Prices – Shipping Services – May 12, 2008

  21. Express Mail Commercial base prices • 3% lower than Retail for Express Mail Corporate Accounts (EMCA), Click-N-Ship, and PC Postage New Prices – Shipping Services – May 12, 2008

  22. Express Mail Commercial volume prices • EMCA and PC Postage New Prices – Shipping Services – May 12, 2008

  23. Priority Mail • Average +6% • New large Flat-Rate box(introduced March 3) • Lower price for APO/FPO addresses New Prices – Shipping Services – May 12, 2008

  24. Priority Mail Commercial base prices • Lower than retail for Click-N-Ship, PC Postage, and permit imprint New Prices – Shipping Services – May 12, 2008

  25. Priority Mail Price examples New Prices – Shipping Services – May 12, 2008

  26. Parcel Select • Last-mile commercial service • Average +5.7% • Promote destination delivery unit (DDU) • Commercial volume prices for DDU • Based on new growth above a threshold • Annual rebates New Prices – Shipping Services – May 12, 2008

  27. Parcel Return Service • First-mile commercial service • Average +2% • Align pricing with outbound DDU • Weight-based pricing New Prices – Shipping Services – May 12, 2008

  28. Global Express Guaranteed • Average +5.2% Retail price examples • Expedited date-certain delivery with money-back guarantee to over 190 countries • Commercial base prices • 10% lower than retail for Click-N-Ship and PC Postage New Prices – Shipping Services – May 12, 2008

  29. Express Mail International • Average +6% Retail price examples • Date-certain delivery with money-back guarantee for packages sent to Pacific Rim countries New Prices – Shipping Services – May 12, 2008

  30. Express Mail International • Commercial base prices • 8% lower than retail for Click-N-Ship, PC Postage, Global Shipping Software (GSS), and Express Mail Corporate Account (EMCA) New Prices – Shipping Services – May 12, 2008

  31. Express Mail International • Commercial volume prices • Express Mail Corporate Account New Prices – Shipping Services – May 12, 2008

  32. Priority Mail International • Average +6.1% Retail price examples • New large Flat-Rate box (introduced March 3) New Prices – Shipping Services – May 12, 2008

  33. Priority Mail International • Commercial base prices • 5% lower than retail for Click-N-Ship, PC Postage, and permit imprint New Prices – Shipping Services – May 12, 2008

  34. International Priority Airmail (IPA) and International Surface Airlift (ISAL) • Average price increase • IPA: 12.5% • ISAL: 21.3% • Continue published prices for full-service and drop ship • Eliminate published ISAL prices for Direct Shipment • Now, available through customized agreement New Prices – Shipping Services – May 12, 2008

  35. Resources • USPS.com/prices • Mailing Services and Shipping Services highlights • New price lists • Downloadable price files • New Postage Statements • Federal Register notices New Prices – May 12, 2008

  36. Resources • Postal Explorer(pe.usps.com) • PCC Insider – PCC e-newsletter (pccinsider@usps.gov) • DMM Advisory – customer e-newsletter (dmmadvisory@usps.com) • P&C Weekly– employee e-newsletter (PandCWeekly@usps.gov) • MailPro – late April (usps.com/mailpro) New Prices – May 12, 2008

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