USPS Ups Competition in the Shipping Market

Up to now shippers have paid the same price per piece no matter the number of packages in a shipment or the method of payment. That will change with the new incentives permitted USPS under the Postal Accountability and Enhancement Act of 2006.

The USPS explains changes will be in the form of commercial volume pricing, minimum volume rebates, on line price breaks and other pricing incentives. It provides these examples:

• Express Mail, premium overnight delivery, is switching to an industry standard, zone-based pricing system, resulting in lower prices for closer destinations. Customers will enjoy a 3% price reduction by purchasing Express Mail on line or through corporate accounts. Up to an additional 7% price reduction is available for those who meet quarterly volume minimums.

• Priority Mail, expedited delivery at economical prices, will be available at an average 3.5% savings to customers who use electronic postage or meet other requirements.

• Parcel Select, the Postal Service “last mile” advantage of delivery to every door, will feature pricing and volume incentives for large- and medium-sized shippers.

• Parcel Return Service, an easy and convenient way for customers to return items to businesses, will move entirely to a weight-based pricing system, resulting in significant price reductions for lighter packages.”

Postmaster General John Potter observes, “These innovative published pricing incentives will make our products more attractive to all shippers, especially small businesses. We’re pricing our products to sell in today’s competitive shipping market. In the near future, the Postal Service plans to explore contract pricing for larger customers similar to others in the market. To see the new pricing, visit www.usps.com/prices.

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