US Postal Service Rate Increases: What That Means For You

Three things that are inevitable in life are death, taxes, and increases in postage rates – especially in an era of rising inflation, higher transportation costs, and moves to stabilize the financial viability of the US Postal Service. Against this backdrop, the USPS has recently announced new rates taking effect on July 18, 2022.

These increases are part of a trend that goes beyond simple responses to overall inflation. In this article, we will break down these new rate increases as well as their larger context for businesses and look at how to leverage automated tools such as ours to mitigate the impact of these rate increases.

A look at the new rates

The latest rate structure announced by USPS represents an overall 6.5% increase in postal rates, affecting both consumer and business postage charges across the board. For first-class letters, these range from a relatively modest two cents (3.4%) in the price of postage stamps for letters up to one ounce, rising from $0.58 to $0.60, to larger increases such as a 10% increase for one-ounce metered mail and a 20% hike for additional per-ounce letter charges.

Rates for typical business mailing applications have risen across the board as well. While overall postage increases for marketing mail also average 6.5%, specific rates such as flats (8.5%) and parcels (9.8%) have increased much more. Postage rates for packages have increased by 8.5% overall and 10.5% for packages of bound printed matter.

Perhaps most importantly, this is unlikely to be the end of further substantial postage increases. The USPS has now gone from annual rate increases to a schedule of twice per year, and its postmaster recently warned consumers to get used to “uncomfortable” future rate increases as the Post Office continues attempting to move towards self-sufficiency. The Delivering for America plan currently lays out a ten-year vision including a goal of breaking even by 2023 while investing over $40 billion in new infrastructure.

Combined with expected rate increases from other shippers such as UPS and FedEx, these rate increases are forcing businesses to keep their costs and revenues in line with inflation at a minimum, and in some cases re-examine their mix of physical mail and shipping for marketing and order fulfillment activities. Perhaps most importantly, they also make it more critical than ever to use automation to optimize their postage and shipping costs.

How we can help

These rate increases – and more importantly, the promise of continued rate increases over time, for all forms of shipping and delivery charges – underscore the importance of using automated tools for ensuring deliverability, avoiding excess charges, and optimizing postal rates for your shipments.

Service Objects address solutions, including its flagship DOTS Address Validation service as well as its DOTS NCOA Live service for address changes, can make a major difference in your postage costs. Address Validation not only ensures deliverability with its CASS-certified validation of USPS addresses but provides barcoding and presort data points that allow you to take advantage of substantial presort discounts. In addition, NCOA Live helps you meet the USPS’ Move Update standard for avoiding expenses due to forwarded or undeliverable mail from changes of address.

All Service Objects data quality products come bundled with the industry’s only financially backed guarantee of 99.999% uptime, as well as expert implementation assistance, available 24/7/365 technical support, and free trial licenses. Contact our friendly product experts for a free, no-pressure consultation and product demonstration to learn more about how to make the most of your postage expenditures.

New resources, straight to your inbox

Get updates on the latest industry trends, tips, and news.


You may also like: