A Weekend in October

This past weekend was beautiful in Dallas, Texas, where I office.  The temperature was in the low 80’s, the humidity was non-existent, and football fans descended on Dallas for the Red River Shootout weekend.  The entire North Texas area looks forward to this legendary meeting of the University of Texas and Oklahoma University at the Cotton Bowl, and it’s the talk of the town.  But there are more important things to talk about this week (sorry football fans) then who won the game.

On Thursday, September 30th, the Postal Regulatory Commission (PRC) rejected the United States Post Office (USPS) request for a rate increase averaging 5.6%. For our industry, this decision allowed us a momentary sigh of relief.  Like it or not, we rely on the USPS as a key partner, and keeping transportation costs in line is crucial to our industry’s long-term success.

When this announcement was made on Thursday, I shared the information with our Association’s board of directors.  The responses were predominantly kudos to our Washington D.C. legislative team led by Lisbeth Lyons, who is our industry’s voice on Capitol Hill.  I had one insightful response I’d like to share.  It came from Gary Newman, our board representative from Amarillo, Texas.  Gary married into the family business years ago and now plays a key role in managing Whitney-Russell, one of West Texas’ best known and highly successful companies.

Here are Gary’s insights, which he agreed to share:  “Not to be a skeptic, but, Government always gets its way.  The price increase in real terms is delayed rather than canceled.  Eventually, the bureaucrats at USPS will get their way, one way or another. We, the people, will prop up the USPS either in direct price increases or in tax supported subsidies.  The good part of this rejection by the Postal Rates Commission is that the hand of the USPS was slapped trying to play the “exigent circumstances” card. Had this not happened, every subsequent increase would have been due to “exigent circumstances” and the brakes would have been off. USPS is going to have to fix their financial woes another way – this time.

Perhaps this will cause the USPS to look at running more like a business than a federal agency; though probably not. There are some good, customer-oriented people in USPS and their ranks are growing slowly. Some are in middle management positions and can affect some positive change in their particular area of influence.  Those efforts are often short-circuited by the “old guard”; union & bureaucrat dominated culture of longstanding. The best way to tell when one of the old guard is in charge is the use of the phrase “You have to…” when they are dealing with customers. These are the people who pick apart a mailing and reject it rather than send it through and go to the next thing.

The dirty little secret is that we (printers) need the services the USPS provides. With all of their shortcomings, the USPS is still the cost/benefit leader for delivering many types of items, particularly lightweight printed pieces (postcards, brochures, etc.). In the case of our company, the cost for shipping personal check packages would more than triple were we to have to use UPS or FedEx Ground instead of USPS Standard Mail. Standard Mail is not trackable as are the other options. So far, personal check customers are generally unwilling to pay the difference for the ability to track their check order in transit. With correct delivery rates around 99%, the USPS is reliable and the most cost effective.  Now I will get off of my soapbox.”

As Gary so eloquently stated, we need to live with the USPS – but our industry needs to be more vocal in how it is run.  When the USPS was created by our forefathers, no one saw the advent of the Internet and or FedEx and UPS.  Yet, we still operate under many of the archaic rules developed over two centuries.  Today, if one is to truly look at the role of the USPS, it’s no longer about linking individuals.  It’s about transporting business communications.  It could be a magazine, catalog, invoice, or a sales brochure.  Oh, and all of that is printed.

One of the main reasons that the PRC rejected the rate increase was because of the pressure which was brought to bear by our industry and many others who create the pieces which travel through the mail.  For the first time in my memory (which goes back about 20+ years), EVERYONE was singing from the same page – and we need to continue do so.

Yet, we also need to find ways to develop relationships at the local level which too many in our community ignore.  Are you involved with your local mailer’s association?  Are you a member of the local Postal Customer Council (PCC)?  Like it or not, print’s success in the future will be closely tied to the USPS.  Thus, we have to act a bit schizophrenic – at the local level we partner, while at the national level we act a bit more confrontational.  At the national level we need Congress to get involved. Much of what the USPS will need to do in “right-sizing” is going to get messy.  Mail centers will have to be closed. There will need to be reductions in force and a restructuring of how pensions are funded and calculated.  Although the USPS does not operate on tax dollars – Congress does have a say — and so do we.

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