A. The dollar impact is easy: 5.5%, because the increase is truly across the board, affecting every rate element. The postage bill for every individual publication will increase by that amount on Jan. 8. The "impact" of a rate increase of that magnitude, which ought to be in the neighborhood of two cents for a typical copy, on individual publications depends upon their financial health.
Q. What can b-to-b publishers do right off the bat to contain what might be a serious blow to their bottom lines?
A. An increase of 5.5% after 3? years of rate stability ought not to be an unexpected blow, even if in some cases it is serious. Assuming that your question is limited to postal steps, the first is to be certain that mailing practices are now taking advantage of whatever discounts might be available, such as for bar code use, maximum presorting and, if possible, having the printer place the mail on pallets, not in sacks.
Q. Is the real test for b-to-b publishers in 2007, when double-digit rate increases are supposed to kick in?
A. Yes, but it's not so much the average increase, which I expect might fall short of double digits that should be the greatest concern. Because the Postal Service is almost certainly going to propose significant changes in rate design as well as rate level, such as, perhaps, by implementing per-bundle and per-container charges to go along with piece and pound charges, most publications with circulations below 200,000 could face very large, double-digit increases if they continue to mail the way they do today. That's why American Business Media and I have been urging members to begin to investigate and move to co-mailing and co-palletizing, which will blunt those large increases.