Understanding the January 2016 U.S. Postal Service Price Change Each year – at least once per year – the U.S. Postal Service® (USPS®) changes rates across their various mail classes and extra services. Often concurrent with these rate changes, the USPS may introduce or eliminate products, such as a Flat Rate Box, or regulations, such as presorted mail requirements. These events are referred to as the USPS Price Change. On January 17, 2016 there will be a price change for shipping mail classes. Both primary competitors of the USPS, UPS and FedEx, will increase their rates in late December 2015 and early January 2016, respectively. Contents Overview Brief Description . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 Key Highlights or Changes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 Background Market Dominant vs. Competitive . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 USPS Pricing Tiers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 Additional Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 Relevant Changes for Competitive Classes – “Shipping” First Class Package Service (FCPS) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 Retail Ground (previously Standard Post) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 Parcel Select Ground (previously Parcel Select Non-presort) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 Priority Mail . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 Priority Mail Express (PME) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 First-Class Package International Service (FCPIS) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10 Priority Mail International (PMI) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10 Priority Mail Express International (PMEI) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11 Global Express Guaranteed (GXG) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12 Comparing Prices: Retail, Commercial Base and Commercial Plus Commercial Rate Changes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13 USPS Price Tier Comparison . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 Private Carrier Comparison . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15 Additional Changes Integrated Customs Form . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18 USPS Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19 Package Intercept Service . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19 Adult Signature . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19 PG 2 Overview Brief Description Key Highlights or Changes: Each year – at least once per year – the U.S. Postal Service Starting at 12:01 a.m. Sunday, January 17, 2016: (USPS) changes rates across their various mail classes and extra services. Often concurrent with these rate changes, the • Commercial Base Pricing (CBP) are being greatly USPS may introduce or eliminate products, such as a Flat Rate Box, or regulations, such as presorted mail requirements. These events are referred to as USPS Price Changes. On January 17, reduced or in some cases eliminated. • loading, domestic and international) Both primary competitors of the USPS, UPS and FedEx, will -- Priority Mail® Regional Rate C Box (domestic and increase their rates in late December 2015 and early January international) 2016, respectively. -- Critical Mail and Critical Mail with Signature Effective Date: U.S. Postal Service: Sunday, January 17, 2016 • FedEx: Monday, January 4, 2016 • UPS: Monday, December 28, 2015 The following product offerings will be eliminated: -- Priority Mail Express® Flat Rate Box (side loading and top 2016 there will be a price change for the shipping mail classes. • Commercial Plus Pricing (CPP) discounts over (letters and flats) -- Parcel Select Origin Network Distribution Center (ONDC) Presort and Network Distribution Center (NDC) Presort -- Parcel Return Service Return Network Distribution Center (RNDC) The January 2016 USPS price change includes a competitive products filing, which the Postal Regulatory Commission (PRC) approved in November 2015. Endicia will update all service offerings with the new prices and • Parcel Select Non-presort will be rebranded as Parcel Select Ground. • Standard Post will be renamed Retail Ground. • The 14, 15, and 15.999 ounce First-Class Package applicable regulations to ensure our customers are compliant Service (FCPS) offerings previously only available with and print postage correctly. We are committed to providing our Commercial Plus will be consolidated into the Commercial customers with all USPS options as soon as they are available, Base price category. This pricing will be available to all and we make it a priority to educate our customers and commercial mailers. No additional minimums will apply partners about the changes and how they will be affected. and an agreement will not be required. International Changes: • A new label layout will be implemented for both domestic and international labels that require an integrated customs form. • Up to $200 of merchandise insurance will be offered for Priority Mail International® with the exception of Priority Mail International Flat Rate® Envelopes and Small Flat Rate Boxes. There are no price changes to Market Dominant mail classes. PG 3 Background Market Dominant vs. Competitive USPS Pricing Tiers Market Dominant mail classes are services for which the USPS The USPS offers discounted pricing options to certain types effectively has a monopoly in the market. of customers for specific types of mail classes. They are also Because there are not equivalent services offered by other carriers, the government restricts the maximum rate at which the Postal Service™ can raise or change these prices. This restriction able to negotiate prices for domestic and international shippers. These negotiated rates are not “published” rates and therefore not covered in our Price Change information. means the average percent increase for each Market Dominant Published pricing tiers include the following: mail class cannot exceed the current year’s Consumer Price Index. • Retail Price: Retail pricing refers to the standard Competitive mail classes are USPS services that are similar to counter price for postage at the Post Office™ or other services offered by private carriers such as FedEx and UPS. physical retail locations. The presence of marketplace competition increases the Postal • Commercial Base Pricing (CBP): Commercial Base Service’s flexibility when pricing these classes, including the ability Pricing refers to the discounted postage price for certain to offer volume or negotiated discounts. There is no maximum rate mail classes available to electronic postage users. The cap for any increase in price for these mail classes. vast majority of Endicia customers automatically receive Below is a table of each mail class by category: CBP for applicable Competitive mail classes. • Commercial Plus Pricing (CPP): Commercial Market Dominant Mail Classes Competitive Mail Classes First-Class Mail First-Class Package Service Standard Mail Retail Ground (formerly Standard Post) Media Mail Parcel Select Ground (formerly Parcel Select) Library Mail Priority Mail With the January 2016 Price Change, CPP rates will either be Bound Printed Matter Priority Mail Express brought within 3% of CBP rates or raised to match CBP rates, First-Class Mail International First-Class Package International Service Plus Pricing refers to deeply discounted postage prices for certain mail classes available to qualified high- Priority Mail International Priority Mail Express International Global Express Guaranteed volume shippers. Endicia customers who qualify for CPP discounts automatically receive them through their software or application. Additional Information depending on mail class. In addition, the Postal Service is restructuring Click-N-Ship® to offer only Retail prices. Click-NShip will no longer be an authorized payment method for Priority Mail Express and Priority Mail Commercial Base Pricing. The Postal Service’s long-term goal is to eliminate the Commercial Plus Pricing category at some point in 2017 to match up with the industry standards of publishing only one set of commercial rate tables and offering negotiated service agreements to discount rates for high-volume shippers. However, since CPP is not going away completely in 2016, the CPP thresholds are not changing. So if a shipper qualifies for CPP in 2015, they will remain on CPP. The USPS will also determine whether certain customers will be eligible for negotiated rates, but will do so on a customer-by-customer basis. PG 4 Relevant Changes for Competitive Classes – “Shipping” First-Class Package Service (FCPS) Retail Ground (Previously Standard Post) • • What do shippers use this service for? • • Retail Ground (previously Standard Post™) is geared toward a lightweight (less than 1 pound) offering used by businesses heavier or larger packages that don’t require expedited delivery. for fulfillment purposes. FCPS is used for items that weigh Retail Ground is designed to compete with UPS or FedEx 1 pound or less and 108” or less in length + height + width. Ground services, with the real benefit to shippers being that, It’s great for small, low-value items like product samples or unlike the private carriers, the USPS does not add surcharges swatches, single t-shirts, or small stuffed animals. for things like fuel, Saturday delivery or rural delivery. What is the delivery standard for FCPS? Retail Ground is ONLY available at the retail counter. The delivery standard for FCPS is 2-3 days (not guaranteed). The comparable mail class available to Endicia customers is This is comparable to FedEx or UPS 2-3 day service for Parcel Select® Ground, which features the same delivery time and packages weighing less than 1 pound. is less expensive than Retail Ground for all weights and zones. Key changes for FCPS: There are no flat rate or regional rate options for Retail Commercial Plus pricing for FCPS will be eliminated, and Ground, nor are there any Commercial Base or Commercial the 14, 15, and 15.999 ounce offerings previously only Plus discounts for this mail class. available with Commercial Plus will be consolidated into the Commercial Base price category. In addition, 14-15.999 • guaranteed) in the continental United States. This is ounce from 14-16 ounces will be given an individual rate. Additional changes: comparable to FedEx or UPS Ground service. • -- The flat rate for 1-3 ounce weights has changed and will Key changes for Retail Ground: The product previously called Standard Post will be renamed now apply to packages weighing 1-8 ounces. Retail Ground in 2016. -- FCPS will only support single-piece pricing and the pricing Pricing for Retail Ground shipments going to Zones 1-4 will categories for 3-digit, 5-digit, and ADC presort levels will remain exactly the same as that of Priority Mail Retail. These be eliminated. packages will automatically be processed as Priority Mail Average overall increase: service, unless Ground service is required. Ground service is -- Retail required when the item being mailed cannot travel by air, as in the case of hazardous materials. There is no Retail price tier for FCPS. Shippers going to the retail counter to purchase this type of postage will use • First-Class Mail Parcel service instead. Average overall increase: There is only one price tier for Retail Ground. Retail Ground pricing will increase on average by 4.4% versus 2015. This -- Commercial Base Pricing FCPS Commercial Base Pricing is increasing by an increase equates to an average of an additional $1.01 per average of 7.6%, which equates to approximately $0.13 package. more per package. • What is the delivery standard for Retail Ground? The delivery standard for Retail Ground is 2-9 days (not ounce offerings previously shared one flat rate—in 2016 each • What do shippers use this service for? First-Class Package Service continues to be positioned as ® Tracking: • Tracking: USPS Tracking is FREE for Retail Ground. USPS Tracking is FREE for FCPS, with no change to this structure YOY. PG 5 Parcel Select Ground (previously Parcel Select Non-presort) • Priority Mail • What do shippers use this service for? Priority Mail is an excellent and economical option for Parcel Select Ground is geared toward items that don’t have businesses shipping packages to residential addresses that want quick delivery with free tracking, while remaining a requirement for expedited delivery. It is similar in delivery cost-conscious. It offers many options, including regular standard to Retail Ground, but more economical in all cases zone-based pricing, flat rate envelopes and boxes, regional and is the USPS Ground delivery option for electronic postage users. rate packaging, and cubic pricing. The Postal Service also There are no Commercial Base or Commercial Plus which can save businesses even more money. In addition, offers a variety of free packaging for Priority Mail shipments, discounts for Parcel Select Ground. For packages going Priority Mail includes free tracking and $50 of free USPS to Zones 1-4, Priority Mail Commercial Base prices are insurance coverage. actually less expensive or equal. For packages going Priority Mail includes three price tiers: Retail, Commercial to Zones 5-8, the rates for Priority Mail are generally just a few cents more than Parcel Select Ground, with faster delivery times that will create a positive consumer Base, and Commercial Plus. • (not guaranteed). This is comparable to FedEx or UPS 2-3 Priority Mail is less expensive to all Zones. There are no flat rate or regional rate options for Parcel Select. What is the delivery standard for Parcel Select Ground? The delivery standard for Parcel Select is 2-9 days (not guaranteed). This is comparable to FedEx or UPS Ground service. • Key changes for Parcel Select: Outside of pricing and the name change for Parcel Select Ground, there are two key changes shippers should be aware of with regard to the overall Parcel Select group of mail classes. First, Parcel Select Lightweight® machinable What is the delivery standard for Priority Mail? The delivery standard for Priority Mail is 2-3 days experience. In fact, for packages weighing 2 or 3 pounds, • What do shippers use this service for? day service. • Key changes for Priority Mail: Outside of pricing, there are three key changes shippers should be aware of with regard to Priority Mail: -- Commercial Plus Pricing for Priority Mail will be brought within 3% of Commercial Base Pricing. -- The Regional Rate Box C will be eliminated due to low customer usage. -- Critical Mail will also be eliminated due to low customer usage. and irregular price tables will be combined, but the operational requirements will remain the same. Second, Parcel Select ONDC Presort and NDC Presort price categories will be eliminated, while the DDU, DSCF and DNDC price categories remain. • Average overall increase: There is only one price tier for Parcel Select Ground. Pricing will decrease on average by 7.7%, which equates to an approximate $2.85 less in cost per package versus 2015 prices. • Tracking: USPS Tracking is FREE for Parcel Select Ground. PG 6 • Average overall increase: -- Commercial Plus Pricing -- Retail Category Average Increase Average Change Per Package Category Average Increase Average Change Per Package Zones 1-8 4.3% +$2.08 Zones 1-8 19.1% +$5.13 Zone 9 20.0% +$20.06 Zone 9 33.0% +$24.43 Flat Rate Envelope 12.2% +$0.70 Flat Rate Envelope 13.1% +$0.65 Legal Flat Rate Envelope 9.3% +$0.55 Legal Flat Rate Envelope 12.2% +$0.61 Padded Flat Rate Envelope 11.5% +$0.70 Padded Flat Rate Envelope 10.3% +$0.55 Small Flat Rate Box 14.3% +$0.85 Small Flat Rate Box 13.5% +$0.70 Medium Flat Rate Box 6.3% +$0.80 Medium Flat Rate Box 8.9% +$0.95 Large Flat Rate Box 4.7% +$0.85 Large Flat Rate Box 7.1% +$1.05 APO/FPO Large Flat Rate Box 5.3% +$0.85 APO/FPO Large Flat Rate Box 8.2% +$1.05 -- Commercial Base Pricing -- Regional Rate options Category Average Increase Average Change Per Package Zones 1-8 2.4% +$1.01 Zone 9 25.0% Flat Rate Envelope Box Type Zones 1-8 Average Increase Zones 1-8 Average Change per Package Zone 9 Average Increase Zone 9 Average Change per Package +21.84 Box A 10.1% +$0.71 25.0% +$2.99 13.9% +$0.70 Box B 5.1% +$0.48 25.0% +$4.88 Legal Flat Rate Envelope 9.5% +$0.50 Padded Flat Rate Envelope 7.0% +$0.40 Small Flat Rate Box 16.2% +$0.85 Medium Flat Rate Box 5.8% +$0.65 Regional Rate box is deposited at Retail. Large Flat Rate Box 3.5% +$0.55 Regional Rate Box C will be eliminated in 2016. Current APO/FPO Large Flat Rate Box 4.0% +$0.55 users may want to consider trying Priority Mail Flat Rate Rates for Regional Rate boxes are the same for Commercial Base and Commercial Plus customers. There is an additional fee of $0.75 per package if a boxes or Regional Rate Box A or Box B for smaller items. Priority Mail and Parcel Select Ground zone-based options are available for larger items. -- Critical Mail Critical Mail will be eliminated in 2016. Priority Mail Flat Rate Envelopes with or without Signature Confirmation may be used as an alternative. PG 7 -- Flat Rate and Regional Rate Pricing Tables -- Cubic Endicia customers have enthusiastically adopted the Priority Mail Cubic, though a Commercial Plus mail class, Priority Mail Flat Rate and Regional Rate options. will remain in 2016. It is available to shippers who meet Recognizing the importance of these packaging types or commit to a volume requirement of 50,000 Cubic- and their actual prices, below is the Flat Rate pricing priced pieces in a calendar year. There are no additions table for Retail, Commercial Base and Commercial Plus to the Priority Mail Cubic mail class options or package tiers, as well as the Zone prices for Regional Rate (Retail sizes. Increase information is below: add $0.75/package). Commercial Base is the pricing for the majority of Endicia users. Note: No Monthly Fee customers pay the Retail price. Flat Rate Package Type Retail Commercial Base Commercial Plus Flat Rate Envelope $6.45 $5.75 $5.60 Legal Flat Rate Envelope $6.45 $5.75 $5.60 Padded Flat Rate Envelope $6.80 $6.10 $5.90 Small Flat Rate Box $6.80 $6.10 $5.90 Medium Flat Rate Box $13.45 $11.95 $11.60 Large Flat Rate Box $18.75 $16.35 $15.85 APO/FPO Large Flat Rate Box $16.75 $14.35 $13.85 Cubic Foot Range Up To Zones 1-8 Average Increase Zones 1-8 Average Change per Package Zone 9 Average Increase Zone 9 Average Change per Package 0.10 20.8% +$1.04 35.7% +$2.49 0.20 12.5% +$0.69 27.8% +$2.10 0.30 9.9% +$0.72 28.5% +$3.40 0.40 7.4% +$0.61 24.6% +$3.91 0.50 1.5% +$0.05 18.6% +$3.78 • Regional Zone Zone Rate L, 1&2 3 Zone 4 Zone 5 Zone 6 Zone 7 Zone 8 Zone 9 Tracking: USPS Tracking is FREE for Priority Mail. -- Box A $6.01 $6.15 $6.60 $8.15 $8.92 $9.70 $10.77 $14.95 Box B $6.71 $7.90 $8.75 $10.66 $13.37 $15.14 $17.09 $24.41 PG 8 Priority Mail Express (PME) • • Average overall increase: -- Retail What do shippers use this service for? Priority Mail Express is perfect for packages that need to be delivered very quickly, with overnight delivery to most locations and second-day delivery in outlying areas. Priority Mail Express includes free tracking and up to $100 of free USPS insurance coverage. As with Priority Mail, Priority Mail Express users can leverage regular zone-based pricing, as well as flat rate envelopes. Category Average Increase Average Change Per Package Zones 1-8 0.2% +$0.04 Zone 9 0% $0 Flat Rate Envelope 14.8% +$2.96 -- Commercial Base Pricing The Postal Service also offers a variety of free packaging for Priority Mail Express shipments, which can save businesses even more money. Category Average Increase Average Change Per Package Priority Mail Express includes three price tiers: Retail, Zones 1-8 42.1% +$38.36 Zone 9 7.0% +$9.02 Flat Rate Envelope 0.14% +$2.55 Commercial Base, and Commercial Plus. • What is the delivery standard for PME? The delivery standard for Priority Mail Express is 1-2 days • (guaranteed). This is comparable to FedEx or UPS Overnight For packages weighing 5 pounds or less, Commercial service in most locations and 2-day service in remote Base rates (Zones 1-8) are increasing an average of locations. 20.9% or $5.31 per piece. Key changes for PME: -- Commercial Plus Pricing Outside of pricing, there are two key changes shippers should be aware of with regard to Priority Mail Express: Category Average Increase Average Change Per Package Zones 1-8 48.2% +$42.52 Zone 9 12.2% +$17.15 Flat Rate Envelope 39.1% +$5.81 -- Commercial Plus pricing as a whole will be increased to match Commercial Base pricing. -- The Priority Mail Express Flat Rate Box (both side loading and top loading) will be eliminated due to insufficient volumes. For packages weighing 5 pounds or less, Commercial Plus rates (Zones 1-8) are increasing an average of 40.8% or $8.72 per piece. • Tracking: USPS Tracking is FREE for Priority Mail Express. PG 9 First-Class Package International Service (FCPIS) • • The delivery standard for PMI is 6-10 business days (to most destinations). What do shippers use this service for? First-Class Package International Service® is the most • thick and weigh less than 4 pounds that do not require time- $100 for documents with the exception of PMI Flat Rate sensitive delivery. Envelopes and Small Flat Rate Boxes. -- Prices for PMI flat rate envelopes and boxes will be Commercial Plus prices for First-Class Package International further separated into additional country groups. Service will be matched to Commercial Base Pricing. is often dependent on the quality of each country’s local Post. Average overall increase (excluding Canada): -- Retail The Retail price for PMI is increasing by an average of -- Retail 3.3% per package, which equates to an increase in the 21.5% per package, which equates to an increase in the average price per package of $4.11. -- Commercial Base Pricing Commercial Base pricing for FCPIS is increasing by an average of 28.2% per package, which equates to an increase in the average price per package of $4.98. -- Commercial Plus Pricing Commercial Plus pricing for FCPIS is increasing by an average of 37.6% per package, which equates to an increase in the average price per package of $6.29. Tracking: Electronic USPS Tracking International is FREE on FCPIS packages going to select destinations. Priority Mail International (PMI) • • Average overall increase: The Retail price for FCPIS is increasing by an average of • -- The PMI Regional Rate Box C will no longer be available. What is the delivery standard for FCPIS? The delivery standard for FCPIS varies widely by country and • Key changes for PMI: -- Insurance will be offered up to $200 for merchandise and economical way to ship packages that are more than 0.75” • What is the delivery standard for PMI? average price per package of $5.21. For packages weighing 5 pounds or less, Retail rates are increasing an average of 3.3% or $1.68 per piece. Flat Rate packaging Retail prices are increasing an average of 14.1% or $4.99 per package. -- Commercial Base Pricing The Commercial Base price for PMI is increasing by an average of 12.8% per package, which equates to an increase in the average price per package of $17.05. For packages weighing 5 pounds or less, Commercial Base rates are increasing an average of 12.8% or $5.63 per piece. Flat Rate packaging Commercial Base prices are increasing an average of 13.9% or $4.69 per package. -- Commercial Plus Pricing What do shippers use this service for? The Commercial Plus price for PMI is increasing by an Priority Mail International® is a reliable and affordable way average of 24.2% per package, which equates to an to ship non-time sensitive packages up to 70 pounds to increase in the average price per package of $29.29. international locations. PMI includes delivery status with the For packages weighing 5 pounds or less, Commercial USPS Track & Confirm tool on all package types except the Plus rates are increasing an average of 24.2% or $9.69 Flat Rate Envelopes and Small Flat Rate Box, which instead per piece. include free USPS Tracking to select countries. Flat Rate packaging Commercial Plus prices are increasing an average of 13.9% or $4.69 per package. PG 10 • Average overall increase (Canada only): -- Retail The Retail price for PMI to Canada is increasing by an Priority Mail Express International (PMEI) • Priority Mail Express International® offers shippers average of 3.9%, which equates to an increase in the economical expedited international delivery to most average price per package of $5.42. countries, with date-specific service to select major market For PMI to Canada packages weighing 5 pounds or less, countries (i.e. Australia, China, Great Britain). PMEI includes Retail rates are increasing an average of 2.4% or $0.95 $200 insurance coverage, free tracking and a money-back per piece. guarantee in certain countries. For PMI to Canada, Flat Rate packaging Retail prices are • increasing an average of 8.0% or $2.23 per package. The Commercial Base price for PMI to Canada is specific delivery available to certain markets). • increasing by an average of 12.0% per package, which Commercial Base pricing. of $13.17. -- PMEI Flat Rate Envelopes will be further separated into additional country groups. For packages weighing 5 pounds or less, Commercial -- The PMEI Flat Rate Box will be eliminated due to low Base rates to Canada are increasing an average of customer usage. 11.5% or $4.02 per piece. Canada are increasing an average of 6.2% or $1.41 per package. -- Commercial Plus Pricing The Commercial Plus price for PMI to Canada is increasing by an average of 25.0% per package, which • Average overall increase: -- Retail The Retail price for PMEI is increasing by an average of 6.9% per package, which equates to an increase in the average price per package of $13.21. For packages weighing 5 pounds or less, Retail rates are equates to an increase in the average price per package increasing an average of 7.3% or $4.65 per piece. of $24.78. Flat Rate envelope Retail prices are increasing an For packages weighing 5 pounds or less, Commercial average of 20.2% or $9.98 per package. Plus rates to Canada are increasing an average of 23.1% • Key changes for PMEI: -- Commercial Plus prices for PMEI will be matched to equates to an increase in the average price per package For Flat Rate packaging, Commercial Base prices to What is the delivery standard for PMEI? The delivery standard for PMEI is 3-5 business days (date- -- Commercial Base Pricing • What do shippers use this service for? -- Commercial Base Pricing or $7.36 per piece. The Commercial Base price for PMEI is increasing by Flat Rate packaging Commercial Plus prices to Canada an average of 15.9% per package, which equates to an are increasing an average of 6.2% or $1.41 per package. increase in the average price per package of $27.29. Flat Rate options: For packages weighing 5 pounds or less, Commercial PMI offers five Flat Rate options: a standard envelope and a Base rates are increasing an average of 11.1% or $6.54 legal envelope, which are priced the same, as well as small, per piece. medium and large boxes. Flat Rate envelope Commercial Base prices are Tracking: increasing an average of 33.5% or $14.07 per package. USPS Tracking is FREE for PMI, but NOT available with Flat Rate Envelopes, and is only available with the Small Flat Rate Box to select countries. PG 11 -- Commercial Plus Pricing The Commercial Plus price for PMEI is increasing an average of 34.5% per package, which equates to an Global Express Guaranteed (GXG) • Global Express Guaranteed® is perfect for the international increase in the average price per package of $50.44. shipment of items or documents that require fast, For packages weighing 5 pounds or less, Commercial guaranteed delivery with advanced end-to-end tracking. Plus rates are increasing an average of 35.7% or $13.04 Final delivery for GXG® is made by FedEx, allowing shippers per piece. to have full shipment visibility. GXG also includes $100 in Flat Rate packaging Commercial Plus prices are USPS insurance coverage. increasing an average of 33.5% or $14.07 per package. • • What is the delivery standard for GXG? Flat Rate options: The delivery standard for GXG is 1-3 days (guaranteed, date- PMEI offers two Flat Rate options, a standard envelope and certain delivery). a legal envelope (priced the same). The PMEI Flat Rate Box • will be eliminated in 2016. • What do shippers use this service for? Average overall increase: -- Retail Tracking: The Retail price for GXG is increasing by an average of USPS Tracking is FREE for PMEI. 6.7% per package, which equates to an increase in the average price per package of $20.60. For packages weighing 5 pounds or less, Retail rates are increasing an average of 7.1% or $7.17 per piece. -- Commercial Base Pricing The Commercial Base price for GXG is increasing by an average of 20.6% per package, which equates to a decrease in the average price per package of $53.40. For packages weighing 5 pounds or less, Commercial Base rates are increasing an average of 21.2% or $17.91 per piece. -- Commercial Plus Pricing The Commercial Plus price for GXG is increasing by an average of 33.3% per package, which equates to an increase in the average price per package of $78.01. For packages weighing 5 pounds or less, Commercial Plus rates are increasing an average of 33.9% or $25.98 per piece. • Tracking: USPS Tracking is FREE for GXG, with no change to this structure YOY. PG 12 Comparing Prices: Retail, Commercial Base and Commercial Plus Commercial Rate Changes Commercial Plus Pricing (CPP) previously provided highly discounted postage rates to qualified high-volume shippers. For Qualification thresholds for Priority Mail Commercial Plus Pricing remain unchanged in 2016. The minimum volume thresholds are shown below. 2016, Commercial Plus Pricing discounts will either be brought within 3% of Commercial Base rates or eliminated. In addition, the Postal Service is restructuring Click-N-Ship® to offer only retail prices. Click-N-Ship will no longer be an authorized payment method for Priority Mail Express and Priority Mail Commercial Base Pricing. The Postal Service’s long-term goal is to eliminate the Commercial Plus category at some point in 2017 to match Mail Class Type of Packages Included Qualification Threshold Priority Mail Express All domestic Priority Mail Express shipments 5,000 pieces Priority Mail Letters, Flats and Critical Mail 5,000 pieces Priority Mail Letters, Flats, Packages (including Flat Rate), Critical Mail, and Padded Flat Rate Envelope 50,000 pieces Priority Mail Cubic 50,000 pieces International All First-Class Package International Service, Priority Mail International, Priority Mail Express International, and Global Express Guaranteed packages/shipments $100,000 in postage value up with the industry standards of publishing only one set of commercial rate tables. However, since CPP is not going away completely in 2016, the CPP thresholds are not changing. So if a shipper qualifies for CPP in 2015, they will remain on CPP. Deeper discounting may still be made available to customers through negotiated service agreements, however the USPS will be determining who qualifies on a case-by-case basis. All thresholds are based on the annual (calendar year) quantity of pieces mailed using the listed mail class or combination of mail classes, with the exception of Priority Mail Express. Priority Mail Express qualification is based on the quantity of Priority Mail Express sent in the previous four quarters. PG 13 USPS Price Tier Comparison Shippers are often curious about what these discount tiers really mean in terms of savings. Below is detail around the savings between Retail and Commercial Base Pricing, illustrating the benefits for any shipper using an online postage provider like Endicia. Priority Mail Express Average CBP and CPP Savings vs. Retail Priority Mail Express International Average CBP and CPP Savings vs. Retail 1-70 lbs., Zones 1-8 10.0% Overall 5.0% Packages 5 lbs. and under 10.0% Packages 5 lbs. and under 5.0% Priority Mail International Canada and All Other Average CBP and CPP Savings vs. Retail Overall 5.0% Packages 5 lbs. and under 5.0% FCPIS Average CBP and CPP Savings vs. Retail Priority Mail Average CBP Savings vs. Retail Average CPP Savings vs. Retail Average CPP Savings vs. CBP Overall 18.4% 20.8% 3.0% Packages 5 lbs. and under 16.6% 19.1% 3.0% Global Express Guaranteed Average CBP and CPP Savings vs. Retail Overall 5.0% Overall 5.0% Packages 1 lb. and under 5.0% Packages 5 lbs. and under 5.0% PG 14 Private Carrier Comparison UPS and FedEx will both be raising shipping rates as well as numerous surcharges in 2016. Here is a summary of the key product changes: • • Ground and Home Delivery FedEx Weights • UPS Average % Increase Average $ Increase Average % Increase 1-70 lbs. $1.06 4.7% $1.06 4.7% 1-5 lbs. $0.51 5.8% $0.51 6-10 lbs. $0.59 5.5% $0.59 Weights UPS Average $ Increase Average % Increase Average $ Increase Average % Increase 1-70 lbs. $6.13 7.5% $5.01 7.0% 5.8% 1-5 lbs. $1.37 7.5% $1.23 7.6% 5.5% 6-10 lbs. $2.10 7.4% $1.88 7.5% 2-Day • FedEx • FedEx Average $ Increase Weights 3-Day Next Day UPS FedEx Average $ Increase Average % Increase Average $ Increase Average % Increase Weights 1-70 lbs. $9.00 7.5% $10.13 8.2% 1-5 lbs. $2.24 7.8% $2.35 6-10 lbs. $3.34 7.8% $3.55 UPS Average $ Increase Average % Increase Average $ Increase Average % Increase 1-70 lbs. $11.14 6.3% $12.91 6.1% 8.1% 1-5 lbs. $3.26 6.3% $4.06 6.3% 8.2% 6-10 lbs. $4.79 6.4% $5.65 6.2% Surcharges Surcharge FedEx UPS Average $ Increase Average % Increase Average $ Increase Average % Increase Residential Ground $3.65 4.3% $3.25 4.8% Residential Home Delivery $3.25 4.8% N/A N/A Residential Air $3.65 4.3% $3.65 4.3% Address Correction $13.00 4.0% $13.00 4.0% DAS/EDAS Commercial Ground/Home $2.30 4.5% $2.30 4.5% DAS/EDAS Commercial Air $2.45 4.3% $2.45 4.3% DAS Residential Ground $3.70 4.2% $3.10 5.1% DAS Residential Home $3.15 5.0% N/A N/A DAS Residential Air $3.70 4.2% $3.80 4.1% EDAS Residential Ground/Home $4.00 5.3% $4.00 5.3% EDAS Residential Air $4.00 5.3% $4.00 5.3% PG 15 Private Carrier Comparison (continued) The following charts compare USPS and private carrier rates. What’s important to note here is that the fields depicting a percentage are where USPS wins over private carriers. • Priority Mail vs. Ground/Home Delivery (includes $3.25 Residential surcharges) USPS SAVINGS: Ground vs. Priority Mail Commercial Base Pricing (includes UPS Ground/FedEx Home Delivery Residential Surcharge of $3.25) USPS SAVINGS: Ground vs. Priority Mail Commercial Plus Pricing (includes UPS Ground/FedEx Home Delivery Residential Surcharge of $3.25) Weight Zone 2 Zone 3 Zone 4 Zone 5 Zone 6 Zone 7 Zone 8 Weight Zone 2 Zone 3 Zone 4 Zone 5 Zone 6 Zone 7 Zone 8 1 43.6% 45.1% 45.2% 45.5% 45.8% 43.8% 39.9% 1 45.0% 46.7% 46.8% 47.2% 47.4% 45.5% 41.7% 2 44.9% 46.5% 45.7% 34.0% 30.0% 25.1% 18.5% 2 46.6% 48.1% 47.4% 36.0% 32.1% 27.3% 20.9% 3 44.8% 40.1% 35.4% 24.6% 14.0% 9.3% N/A 3 46.4% 41.9% 37.4% 26.9% 16.5% 12.0% 1.6% 4 40.5% 34.5% 33.2% 21.3% 3.4% N/A N/A 4 42.3% 36.4% 35.2% 23.6% 6.3% N/A N/A 5 34.7% 34.1% 33.1% 19.2% N/A N/A N/A 5 36.7% 36.1% 35.1% 21.6% N/A N/A N/A 6 35.0% 34.6% 33.3% 14.4% N/A N/A N/A 6 36.9% 36.5% 35.3% 16.9% N/A N/A N/A 7 36.7% 35.5% 31.0% 9.7% N/A N/A N/A 7 38.6% 37.4% 33.1% 12.4% N/A N/A N/A 8 35.2% 32.5% 30.1% 6.5% N/A N/A N/A 8 37.2% 34.6% 32.2% 9.3% N/A N/A N/A 9 32.5% 32.1% 29.8% 1.8% N/A N/A N/A 9 34.5% 34.2% 31.9% 4.7% N/A N/A N/A 10 31.5% 30.8% 29.6% N/A N/A N/A N/A 10 33.5% 32.9% 31.7% 1.3% N/A N/A N/A 11 31.3% 31.3% 29.4% N/A N/A N/A N/A 11 33.4% 33.4% 31.6% N/A N/A N/A N/A 12 30.5% 30.9% 29.2% N/A N/A N/A N/A 12 32.6% 32.9% 31.3% N/A N/A N/A N/A 13 30.1% 30.4% 29.1% N/A N/A N/A N/A 13 32.2% 32.5% 31.2% N/A N/A N/A N/A 14 30.3% 30.1% 28.9% N/A N/A N/A N/A 14 32.3% 32.2% 31.0% N/A N/A N/A N/A 15 29.6% 29.1% 28.9% N/A N/A N/A N/A 15 31.7% 31.2% 31.0% N/A N/A N/A N/A 16 26.4% 26.0% 26.3% N/A N/A N/A N/A 16 28.6% 28.2% 28.5% N/A N/A N/A N/A 17 26.8% 26.0% 26.0% N/A N/A N/A N/A 17 29.0% 28.2% 28.2% N/A N/A N/A N/A 18 26.1% 25.8% 25.5% N/A N/A N/A N/A 18 28.3% 28.0% 27.8% N/A N/A N/A N/A 19 25.5% 24.3% 23.1% N/A N/A N/A N/A 19 27.7% 26.6% 25.4% N/A N/A N/A N/A 20 24.9% 23.0% 22.6% N/A N/A N/A N/A 20 27.2% 25.3% 24.9% N/A N/A N/A N/A 21 19.9% 19.7% 19.7% N/A N/A N/A N/A 21 22.3% 22.1% 22.1% N/A N/A N/A N/A 22 11.2% 11.8% 11.8% N/A N/A N/A N/A 22 13.9% 14.4% 14.5% N/A N/A N/A N/A 23 2.1% 4.7% 2.6% N/A N/A N/A N/A 23 5.0% 7.6% 5.5% N/A N/A N/A N/A 24 N/A N/A N/A N/A N/A N/A N/A 24 N/A N/A N/A N/A N/A N/A N/A 25 N/A N/A N/A N/A N/A N/A N/A 25 N/A N/A N/A N/A N/A N/A N/A PG 16 Private Carrier Comparison (continued) • Priority Mail vs. UPS 3-Day (includes Residential surcharge of $3.65) USPS SAVINGS: UPS 3-DAY vs. Priority Mail Commercial Base Pricing (includes UPS Ground/FedEx Home Delivery Residential Surcharge of $3.65) USPS SAVINGS: UPS 3-DAY vs. Priority Mail Commercial Plus Pricing (includes UPS Ground/FedEx Home Delivery Residential Surcharge of $3.65) Weight Zone 2 Zone 3 Zone 4 Zone 5 Zone 6 Zone 7 Zone 8 Weight Zone 2 Zone 3 Zone 4 Zone 5 Zone 6 Zone 7 Zone 8 1 55.4% 58.5% 60.1% 63.4% 68.7% 69.2% 69.0% 1 56.6% 59.8% 61.3% 64.5% 69.6% 70.1% 69.9% 2 53.8% 59.0% 59.0% 55.4% 59.4% 58.8% 59.4% 2 55.1% 60.2% 60.2% 56.8% 60.6% 60.1% 60.6% 3 56.8% 54.5% 52.8% 51.1% 53.9% 52.1% 51.3% 3 58.1% 55.9% 54.2% 52.6% 55.3% 53.6% 52.8% 4 55.8% 53.1% 51.1% 51.5% 50.8% 47.9% 47.4% 4 57.2% 54.5% 52.6% 53.0% 52.3% 49.4% 49.0% 5 53.5% 55.1% 53.1% 52.4% 49.9% 45.1% 44.2% 5 54.9% 56.5% 54.5% 53.8% 51.4% 46.7% 45.9% 6 54.5% 57.5% 56.5% 52.7% 47.8% 43.0% 41.1% 6 55.9% 58.8% 57.8% 54.1% 49.3% 44.7% 42.8% 7 55.4% 59.8% 57.3% 51.8% 46.1% 42.5% 39.3% 7 56.7% 61.0% 58.6% 53.2% 47.7% 44.2% 41.1% 8 55.5% 60.0% 59.0% 52.6% 44.9% 41.2% 37.0% 8 56.9% 61.2% 60.2% 54.0% 46.5% 43.0% 38.9% 9 54.8% 60.6% 60.8% 52.3% 43.8% 39.8% 34.6% 9 56.2% 61.7% 61.9% 53.7% 45.4% 41.6% 36.6% 10 55.2% 60.7% 61.7% 52.1% 42.0% 38.2% 33.3% 10 56.5% 61.9% 62.8% 53.5% 43.7% 40.0% 35.3% 11 55.7% 61.6% 63.2% 52.1% 41.2% 35.7% 31.6% 11 57.0% 62.8% 64.3% 53.5% 43.0% 37.6% 33.6% 12 56.4% 62.7% 64.2% 52.0% 39.5% 33.7% 30.6% 12 57.7% 63.9% 65.3% 53.5% 41.3% 35.7% 32.7% 13 57.5% 63.3% 65.1% 51.6% 38.2% 34.5% 32.1% 13 58.8% 64.4% 66.2% 53.0% 40.0% 36.5% 34.1% 14 57.6% 64.2% 66.0% 51.7% 37.6% 34.2% 32.0% 14 58.9% 65.3% 67.1% 53.1% 39.4% 36.2% 34.0% 15 58.8% 63.3% 66.9% 51.6% 38.3% 35.7% 33.8% 15 60.1% 64.4% 67.8% 53.1% 40.1% 37.6% 35.7% 16 57.1% 62.6% 66.5% 51.7% 37.3% 35.2% 32.7% 16 58.4% 63.7% 67.5% 53.2% 39.1% 37.2% 34.8% 17 57.5% 61.5% 66.9% 52.6% 36.4% 34.4% 32.2% 17 58.8% 62.7% 67.9% 54.0% 38.3% 36.3% 34.2% 18 58.0% 61.6% 67.0% 53.3% 35.2% 34.0% 31.0% 18 59.3% 62.8% 68.0% 54.7% 37.2% 36.0% 33.1% 19 58.5% 61.3% 67.0% 53.7% 34.5% 33.4% 30.1% 19 59.7% 62.5% 68.0% 55.1% 36.4% 35.4% 32.2% 20 58.8% 61.8% 67.3% 54.4% 35.0% 33.3% 29.4% 20 60.0% 62.9% 68.3% 55.8% 36.9% 35.3% 31.6% 21 56.5% 60.9% 65.2% 52.6% 35.7% 35.0% 30.6% 21 57.8% 62.0% 66.3% 54.1% 37.7% 36.9% 32.7% 22 52.2% 57.9% 62.5% 50.4% 38.0% 36.5% 32.2% 22 53.6% 59.2% 63.6% 51.9% 39.8% 38.4% 34.2% 23 48.2% 54.6% 58.9% 47.9% 39.3% 38.0% 33.9% 23 49.8% 56.0% 60.1% 49.5% 41.1% 39.8% 35.9% 24 44.2% 49.1% 52.7% 43.9% 40.0% 38.4% 34.5% 24 45.9% 50.6% 54.1% 45.6% 41.8% 40.3% 36.4% 25 41.1% 45.5% 45.0% 40.1% 40.6% 38.9% 35.4% 25 42.9% 47.1% 46.7% 41.9% 42.4% 40.7% 37.3% PG 17 Additional changes Integrated Customs Form In 2016, Endicia will implement new label layouts for both domestic and international labels that require an integrated customs form (e.g. APO/FPO and U.S. Territories). The changes come after new guidelines for customs declarations forms were Endicia is currently submitting new layout designs for labels that include Forms 2976, 2976-A or 2976-B to the USPS for approval. The following are strictly mockups of the proposed label layouts and are not the final label layout versions: PS Form 2976 published by the USPS in March 2015. The new guidelines affect any label layouts that feature an integrated customs form 2976, 2976-A, or 2976-B. Key changes occurring to these layouts include: • Picking the customs form type is no longer required. Your Endicia software will select the correct form type based on shipment parameters entered. • Some destinations that previously required a multi-page customs form now require only one page. More countries may be added in the future and your Endicia software will update automatically to remain compliant. • Date of mailing will be used in place of the round date stamp. • The comments section has been removed (please note PS Form 2976-A that any comments entered will not print on the labels). • Dimensions will now print on the label. • New icons have been added for weight, signature, and acceptance scan requirements. PG 18 USPS Insurance Package Intercept Service There are no changes to USPS regular insurance rates for Package Intercept Service is used to redirect domestic 2016. Priority Mail continues to include the first $50 of USPS shipments that have not yet been delivered or released for insurance for free and Express Mail the first $100 of insurance delivery. It is available for packages, letters, and flats with a for free. New for 2016, the USPS will now offer up to $200 in tracking or extra services barcode and all mail classes, except merchandise insurance and $100 of document insurance for Standard Mail® and Periodicals. Package Intercept Service is Priority Mail International and Priority Mail Express International, increasing $0.40 (3.3%) to $12.55. with the exception of Flat Rate Envelopes and Small Flat Rate Boxes, at no charge. There are no changes to Endicia Parcel Insurance. This option is available to Endicia customers subscribed to a paid service plan or using an integrated partner supporting Endicia Parcel Insurance. Adult Signature Rates are changing for both the basic service as well as for the person-specific service. Adult Signature Required and Adult Signature Restricted Delivery are available for Express Mail, Priority Mail, and Parcel Select Ground. Adult Signature Required is increasing by $0.20 (3.6%) to $5.70. Adult Signature Restricted Delivery is increasing by $0.20 (3.5%) to $5.95. PG 19 Endicia and USPS: The Right Choice for Your Package Shipments Why Endicia? No Hidden Fees—Private carriers regularly tack on • surcharges for residential, Saturday and rural deliveries, address validation and so much more. It’s all included at no postage printed. • extra cost with the USPS. The cost you see in the Endicia software is the price you pay. APO/FPO, PO Box Delivery—USPS is the only carrier that can deliver to military and diplomatic addresses, as well customs forms. • • Pay-on-Use Returns™- With Endicia’s Pay-on-Use Returns you only pay for postage on the return shipping label if and when it is used. • Auto-Refund Service™ (ARS) - ARS automates the process of requesting refunds for unused postage by identifying potentially unused shipping labels and delivers every day of the year to residential addresses, submitting a refund request to the U.S. Postal Service on mailboxes, mail slots and PO Boxes. The Endicia software packages whenever it is convenient for you. Intuitive, easy-to-use tools to print labels and track your packages. Delivery 365 days/year—USPS is the only carrier that is also available at any time so you can easily ship out your Close partnership with the USPS to help tailor the best solution for your business. as PO Boxes. Endicia software makes sending packages to APO/FPO addresses easy with integrated shipping and The leader in electronic postage with over $14 billion in your behalf. • Delivery Status Notification™ - With this simple, centralized way to identify packages, you can receive Tracking—With the introduction of the Intelligent Mail automated daily reports on packages with one of three Barcode (IMpb) the USPS typically has over 10 scan events Delivery Status types: Delivered, Delivery Failure or per package. Endicia supports IMpb and offers online tracking, making it easy to keep an eye on packages. Delivery Exception. • Endicia Global Service™ (EGS) - Endicia Global Service Flat Rate Options (domestic and international)—Priority eliminates many of the pain points associated with Mail flat rate boxes from USPS offer a quick, easy and shipping to Latin America, such as customs delays, theft convenient way to ship packages, at the most affordable and costly shipping options. Reach key markets in Latin price. Endicia software can help you choose the package America thanks to quicker and more reliable customs option that is best for your business. clearance, package tracking and affordable rates. Negotiated Pricing—USPS and Endicia offer the most competitive pricing for your packages – don’t be fooled by private carrier rates that don’t reflect the true price once hidden surcharges are added. Visit our January 2016 USPS Price Change page at www.endicia.com/usps/postage-rate-change/2016 for information and resources. PG 20