Three Things that Impact Postage Costs

Find savings for your clients by focusing on these areas

There’s a fine line when it comes to maximizing savings oPostage Costsn postage costs.

For example, did you know that the thickness of your mailing is measured down to hundredths of an ounce, and that a mailing that weighs .001 ounces over or under the USPS’s standards can result in upcharges on postage? Or that 45%-50% of the cost of mailing is due to postage (pass through cost), and that significant savings can be uncovered by carefully analyzing your practices in this area?

Read up on the three things that impact postage costs below, and let’s get to work on finding better deals for you and your clients now!

1. The List

It’s easy to see why keeping your list clean is important. Outdated lists cost money, and they also cost you in reduced response rates. Aside from having a fresh, updated list it also helps a lot if that list is catered to reach recipients who have a lot in common with your existing sales base. Targeting using demographics is a highly effective practice that will save you money by mailing things to people who are more likely to say “yes.”

Another thing to keep in mind with lists is how to get the best results from saturation list mailings. Saturation lists can be delivered just by zip code, or they can be executed in more calculated fashion. Determining which method is most effective for your campaign can unlock savings.

2. Size/Preparation

There’s more to take into consideration when designing and constructing your mailpiece than its thickness. Size, fold location, and even the amount of glue spots or tabs must be determined beforehand to make sure that the mailpiece can be shipped using the most efficient, cost effective method.

Click the links within this bulleted list to learn more about how to design and prepare your mailings in a way that make it possible to save the most.

Mailpieces which require hands-on, human processing costs a few cents more to process. Whatever the size of your campaign is, designing it to ship more inexpensively is a wise plan. View the table below to see just how quickly the savings unlocked through machine-ready mail add up.

Quantity Machine Ready Not Machine Ready Do the Math
1  23 cents 53.2 cents 30.2 cents cheaper
1,000  $230 $532 $302
2,000  $460 $1064 $604
5,000  $1150 $2660 $1,510

 3. Entry

After you’ve got a great list and a mailpiece designed to fit your needs, it’s time to hone in on entry…i.e. figure out how to get it there. Before you can maximize entry discounts, you must first understand how mail gets delivered.

There are three basic entry points for direct mail:

  • DDU – Destination Delivery Unit
  • SCF – Sectional Center Facility
  • NDC – National Disbursement Center

The different sizes, shapes and weights of different mailing types means that different entry points are most suitable for different campaigns. One of these options might be the least expensive for Campaign A and the most expensive for Campaign B. It depends on what you send.

For example, the least expensive (& fastest) way to get mail into homes is to drop ship to the DDU because it saves the time and expense of moving the mail through the national and regional units, however, mail has to be considered a “FLAT” for shipping to the DDU to be allowed. Understanding the science of drop shippingwill also go a long way to helping you and your partners save money.

In a nutshell, drop shipping works as such: Rather than sending their mailpieces individually from their point of origin to destination, the pieces are shipped in bulk to the post office center that is closest to the recipient and then sent from there.

For example, a direct mail provider in California that drop ships the mailpieces from out west to a post office near their out-of-state clients’ targets can do so more quickly and cost effectively (provided that the mail piece is the correct size, weight, etc.) than when employing the traditional Point A to Point B method.

Wrap Up

The more you do for the post office, the more savings the post office will pass on to you. Now that we’ve identified these bottom-line boosting ideas, it’s up to you to decide if you know your DDU from your SCF…or if partnering with an agency who does makes more sense.

Allegiant Marketing Group ensures that construction and design of all mailpieces meets USPS regulations, and we consistently analyze and choose the best way to deliver mail to get the best shipping postage costs. We can help you by functioning as your outsourced direct mail provider, or by acting as consultants ready to guide your campaign to success.

Either way, there is a lot to keep in mind when it comes to scouring the market for the best deals available. Leave it to us. We’ve been finding savings for our partners for over fifteen years. Contact us and we’ll do the same for you.

 

BE ON THE LOOKOUT NEXT WEEK!
For the kickoff of our next blog series, “How to Save Money on Printing”

Eric Weisgarber

Eric Weisgarber is the founder and President of Allegiant Marketing Group, Inc. His calling is helping business professionals grow their gross profits, net profits, and cash-flow through through marketing services, systems implementation and consulting. His business calling is aligned with his life\’s purpose – developing people and serving the community through discipleship.

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