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DMA WARNS THAT NEEDED POSTAL REFORM LEGISLATION IS THREATENED BY WELL-FINANCED LOBBYING MUSCLE: UPS Should Consider the Survival of Its Own Customers
NEW YORK – June 12, 2002 – The Direct Marketing Association (The DMA) today again urged Congress and the Administration to give the United States Postal Service (USPS) the mechanisms it needs to compete and remain viable in the 21st century.
The DMA believes, as it had indicated publicly in a recent Roll Call ad, that these goals can best be achieved by moving the legislative process forward and taking committee action on a draft bill circulated by Rep. John McHugh (R-NY) in the fall of 2001. The draft, which has support on both sides of the aisle, is the result of industry and labor efforts to reform the 32-year-old law that hampers the Postal Service from competing in today's communications and delivery marketplace.
While language in a more recent draft that incorporates changes proposed by Chairman Dan Burton (R-IN), Rep. Henry Waxman (D-CA) and Rep. Danny Davis (D-IL) has raised some concerns, it also warrants consideration. The deliberative process should be allowed to run its course and not be short-circuited by well-financed opponents of the Postal Service who prefer the status quo.
It has been reported that United Parcel Service (UPS) has marshaled its lobbying muscle to deny the bill a House floor vote – thereby stifling debate on this critical issue. According to The DMA, UPS's reported efforts to thwart postal reform raise grave concerns about the future of postal reform and the apparent lack of representation given to the nine million Americans who count on an effective Postal Service for their livelihoods.
"UPS appears not to have the best interest of its customers at heart," said H. Robert Wientzen, president & CEO, The DMA. "It seems clear that they seek to ensure the further decline of the Postal Service."
Wientzen noted that the current broken Postal Service pricing system allows UPS the advantage of having direct input on what the Postal Service, one of its major competitors, can charge for delivery.
"What other American company has the advantage of being able to set the prices of its competitors," asked Wientzen.
"It is up to Congress to ensure that there is competition in the parcel delivery industry," he said.
For example, earlier this year, UPS announced that it would double its $5 penalty for customers who forget to put their account number on delivery slips and will tack a 25-cent handling fee for certain specially-printed return labels.
"Worst hit by these extra fees will be Internet retailers and catalog companies, who continue to establish themselves as a backbone of the recovering American economy," Wientzen said. "Such reckless fees are a direct hit on the consumer, who must bear the brunt of these higher shipping costs as a last resort for remote retailers trying to remain profitable."
"An efficient and effective Postal Service would be a boon to UPS's own bottom line," said Wientzen.
"If Congress established a more viable Postal Service by re-examining the Postal Service's antiquated laws, UPS would stand to benefit because it delivers 80 percent of goods sold at a distance," Wientzen said.
"After all, the more cost effective it is for companies to find customers by direct mail, the more sales volume UPS will see in its package delivery business. We wish UPS would consider this point of view," Wientzen concluded.
Mr. Wientzen is available for print and broadcast interviews.
The DMA is the leading and largest trade association for businesses interested in interactive and database marketing, with nearly 5,000 member companies from the United States and 53 other nations. Founded in 1917, its members include direct marketers from every business segment as well as the nonprofit and electronic marketing sectors. Included are catalogers, Internet retailers and service providers, financial services providers, book and magazine publishers, book and music clubs, retail stores, industrial manufacturers and a host of other vertical segments, including the service industries that support them. According to a DMA-commissioned study, direct and interactive marketing sales in the United States will exceed $1.7 trillion in 2000, including $110 billion in catalog sales and $24 billion in sales generated by the Internet. The DMA's Web Site iswww.the-dma.org and its consumer Web site is www.shopthenet.org.