THE USPS SUMMER SALE

PRC Approves USPS Summer Sale

DMA STATEMENT ON USPS 'SUMMER SALE' APPROVAL

Washington, DC, June 4, 2009 – The Direct Marketing Association (DMA) today applauds the initiative and creativity of the United States Postal Service (USPS) and commends the diligent and expeditious endorsement of the USPS Summer Sale by the Postal Regulatory Commission (PRC).

"The Summer Sale provides an opportunity for marketers and the USPS to create an independent and much needed stimulus to their businesses and the nation's economy," said John Greco, DMA President & CEO.

The potential benefits from the program will accrue to the entire supply chain from creative entities to paper suppliers, printers and private sector common carriers.

The Postal Service estimates that they will realize between $38 million and $95 million in additional net revenue from the expected increase in mail volume.

Direct mail and catalog remain significant contributors to the US economy, accounting for over $56 billion of advertising spending last year and sales of more than $702 billion – including nearly $155 billion in catalog sales. The Summer Sale program will buttress this important segment of the economy.

By endorsing the Summer Sale, the PRC is allowing the USPS to take advantage of the pricing flexibility that DMA worked so hard for in the passage of the Postal Accountability and Enhancement Act. DMA has long advocated seasonal pricing. At the Postal Regulatory Commission/Postal Service Summit in 2007, then DMA Chairman Markus Wilhelm urged the Postal Service to offer seasonal rates and even daily rates to grow mail volume during slower times. DMA endorsed cooperation between the USPS and mailers then, and will continue to do so in the future.

The basic outline of the sale is that any mailer with over 1 million pieces of annual volume is entitled to a 30 percent rebate on the incremental increase in volume mailed between July 1 and September 30, 2009, over previous years. These numbers are subject to a series of calculations that adjust for current mailing trends and any shift in October 2009 volume. You can learn more about the details of the sale here http://www.the-dma.org/postal/.

To inquire about your company's eligibility email summersale@usps.gov. Please click here to view the PRC Summer Sale approval.

DMA looks forward to a successful execution of this initiative and encourages the USPS to continue the use of flex pricing in 2010 with the ability of a broader base of mailers to qualify.

The full decision is available here.

The Postal Service Summer Sale has been approved by the Board of Governors and was submitted on May 1st to the Postal Regulatory Commission for its review. Details of the plan are as follows:

The sale will run from July 1, 2009 through September 30, 2009.
Mailers who mailed over 1 million Standard letters and/or flats from October 1, 2007 through March 31, 2008 are eligible to participate in the sale (about 3,250 mailers accounting for 75% of Standard Mail volume).
Mailers will receive a rebate of 30% on any mail volume in that period which is over the past threshold.
Mailers’ rebates will be adjusted if their October 2009 volume is less than their October 2008 mail volume, adjusted to their mailing trend.

Mailers will pay full postage during the summer. After October 31, 2009, USPS will determine the rebate which each mailer is due. Rebates will be credited to the mailer’s permit account before December 31, 2009.

USPS will be sending eligible mailers letters that will provide the threshold as determined by USPS data systems. Mailers who believe they are eligible but did not receive a letter or mailers who do not agree with the USPS determined threshold may appeal to USPS. USPS, shortly, will provide DMA with the contact for any appeals. We expect mailers to receive these letters by May 4, 2009.

Mailers may enroll in the program on the web on or before July 1, 2009 (URL will be provided once available) after they receive their eligibility letter. NOTE: Enrolling on the web means that the mailer accepts the threshold as determined by USPS or as determined via appeal, whichever is applicable.

In determining the threshold, USPS will aggregate a mailer’s mail from all its permits, ghost permits and subsidiaries and business names. If a mailer has entered its mail or portion thereof using another’s permit (such as a mail service provider), the burden is upon the mailer to provide documentation indicating its volume of mail entered under that permit.

Details of the USPS plan may be viewed at http://prc.gov/Docs/63/63005/Notice%20of%20Price%20Adj.SummerSale.pdf

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