Kirsten Staples | for editor and editor
Today, the cost of each resource seems to be increasing in the newspaper industry. Now more than ever, it’s essential that the industry come together to create unique solutions.
One of these rising costs comes from the United States Postal Service (USPS), which on August 29, 2021 increased its rates for periodicals to 9%. Although newspapers have evolved over the years to offer electronic subscriptions, this is not always an option, especially for consumers who do not have access to the Internet or computers. The USPS is an essential service for the newspaper industry and its customers.
According to a statement released by the USPS in September, an increase in market-dominant products, including periodicals, will again occur in July 2022. The report also indicates that beginning in January 2023, price adjustments will have held twice a year – once in January and again in July.
Brad Hill, CEO, Interlink
“Rate increases are not applied uniformly to all rate factors for a given class of mail. Often they are used to discourage certain mail preparations that are more costly to USPS. For example, most newspapers enter the nearby mail or post office that delivers to the subscriber and in separate foot-sequenced bundles by postal carrier. This is optimal for USPS and generally takes less of an impact when rates increase,” says Brad Hill, CEO of Interlink, a widely used newspaper delivery system.
Although USPS rate increases usually earn a collective eye roll, they are a necessary evil. For many years, the USPS operated under extreme deficit. In many ways, USPS faces issues familiar to the newspaper industry. With the growing popularity of online resources, the need for newspapers, as well as mail, is diminishing. Therefore, both industries must adapt to survive.
Published prices and conversion rates for mail delivery as of May 17, 2021 (Credit: USPS website)
“The rate change request is part of a balanced approach as part of ‘Delivering for America,’ the Postal Service’s 10-year plan to achieve financial sustainability and service excellence. With full implementation, the plan reverses projected losses of $160 billion over the next ten years Proposed rate changes are expected to generate $44 billion over the next ten years,” USPS explained on its website regarding the 2021 price changes.
USPS says even with the rate changes, it will remain “one of the most affordable carriers in the world.” USPS continues to adapt to the country’s changing needs, so the question now becomes, how can the newspaper industry do the same?
USPS annual cost coverage for periodicals from 1960 to 2009. (USPS website)
“DDU is postal jargon for Destination Delivery Unit, which is like entering mail at the post office that directly serves the subscriber’s address. DDU entry is essential for same-day delivery and saves between two and four cents per copy on a quarter pound newspaper Papers entered by DDU also do not need (should not) be left at the post office in bags or bins, which means that this fee is also eliminated for out-of-county mail,” according to Hill. “It seems like every couple of weeks I hear from a newspaper that isn’t taking the barcode automation discount because their local post office said they can’t or don’t use the codes barcode anyway.doesn’t depend on whether the USPS uses the barcode, just whether the barcode was printed correctly with the shipping address.Most software and printers can generate the good barcode now, so why leave it out when everyone can save 3.5 cents or more? Barcode every piece, every time, and save.”
While other carriers are post office alternatives, they come with their own set of issues. Hill explained the benefits newspapers receive by using USPS over other mail carriers:
- Access to other carriers is increasingly difficult.
- The use of the post office reduces delivery costs.
- USPS delivery tends to be more consistent (time of day).
- The way the paper is routed increases the value of the product — that it’s protected in the mailbox, not on the floor, subject to rain and other elements.
- More energy is available to spend on publishing when less energy is spent on delivery.
USPS number of periodicals mailed annually from 1960 to 2009 in thousands. (Credit: USPS website)
“Carrier rates vary a lot these days, but I rarely see carriers paying less than 20 cents per copy and almost never less than 15 cents. Most newspapers can pay the post office about 12 cents to deliver each local with the right setup and input – sometimes even less. Saving 10 cents or more per copy when going to the mail is common and a huge savings. Let’s do this math: save a penny on 4,000 copies delivered six times a week represents a total savings of $125,000 per year. That’s before we factor in management and overhead costs,” Hill said.
Newspapers with a strong interest in rate increases can offer assistance to organizations such as the News Media Alliance. News Media Alliance lobbies for the protection and rights of the news industry, including fighting tariff increases.
“The News Media Alliance, the National Newspaper Association (NNA), and others are fighting postal rate increases that allow the USPS to raise rates as mail volumes decline and service declines. More there’s mail leaving the system due to service outages, plus the cost of The Postal Regulatory Commission (PRC) now allows the USPS to charge extra for shrinkage Potomac Law attorney Ayesha Khan Group argued for mailer coalitions that the PRC violated the Postal Accountability and Improvement Act by allowing the postage price cap that was in effect from 2007 to 2021 to be replaced. is only part of the postal rate calculation now, allowing the USPS to start by charging for inflation and then add charges for other cost drivers.The USPS also sued the PRC , arguing that he has should have been allowed to perform a one-time rate “reset” to recover money lost during the price cap. The Court is expected to rule this fall,” said Tonda Rush, NAA ge General Counsel, in an article about the rate increases titled “USPS Awarded for Poor Service as Rates Rise, Mail Volumes Fall and Service decreases”.
Despite the negative attention, the partnership between newspapers and the post goes back many years. Recent statistics from the USPS show that 84.3% of periodicals were delivered on time between October 1 and October 15 of this year. Hill says relationship building is key to receiving reliable service. Generally, USPS can provide the most consistent service compared to other courier carriers.
“The Postal Service considers recurring mail ‘submarine’, which means they’re losing money on that delivery, so I don’t see much room for additional large-scale discounts. But, at the same time he also called periodicals “the anchor of the mailbox” so clearly there is value appreciation beyond direct revenue I see this playing out best when newspapers entering the courier as the primary delivery mechanism are working with local and even district postal staff during the transition, and a good relationship goes a long way in ensuring consistent and reliable delivery,” Hill said.
Overall, the USPS and the news industry face challenges from the rise of online services, which has only gotten worse during the pandemic. Both industries must work to find unique solutions, and time will tell how future increases will affect their partnership.
Kirsten Staples is a writer for Editor & Publisher. She can be reached at [email protected].