Each fall users of the Canadian postal system have to wait patiently for Canada Post to announce their postage rate plans for the next year. This year is no exception. For casual users of postal delivery the issue is not major but for businesses and large postage users it can offer significant impact on business planning.
Their announcement of 2015 rates which will come effective on January 12 2015 includes a number of changes. For the average user who is most focused on letter mail rates the changes are not major. The per stamp price is still at $1 and the bulk stamp purchase price remains at $0.85. The major change affects those business users who use postage machines to print their own stamps as the rate for these now moves to $0.77 per letter (basic rate) an increase of two cents over the 2014 rate of $0.75.
Machined postage increase is a strange decision
In some ways the decision to increase the rate for the postage machine printed stamps is somewhat strange. Last year Canada Post introduced the lower rate for this class of postage presumably as an incentive for businesses to consider using a postage meter to generate their postage.
This made a lot of sense since it costs Canada Post significantly less for the stamps which are generated by a postage meter (they do have a cost for these as they have to audit and deal with the three companies in Canada that are licensed to build and manage postage meters), since there is a no printing costs and a lower distribution cost. To now partially reverse that decision by only raising the letter mail rate for this class of production is strange. That said, if you are a fairly heavy user of postage the savings of eight cents per stamp over the bulk purchase rate of paper stamps is one good reason for considering a postage machine. There are other reasons as well but that is not the purpose of this article.
Equipment updates to provide the new rate schedules for your brand of postage meter will be available through the manafacturer and each will have a procedure for you to follow. You can find the information here for the update of Francotyp-Postallia mailing systems that we support. Simply follow the steps for the free download. For NeoPost and Pitney Bowes postage meters please contact your vendor for update procedures. It is worth noting, that under most contracts both NeoPost and Pitney Bowes charge a rate change fee (to the tune of many hundreds of dollars) for these updates. The pending postage increase combined with the update fees may make it worthwhile to seriously consider reviewing your postage meter contract and vendor in the new year.
Some categories see a potential decrease
There is some good news for some categories of users in the new rates. In a recent blog it was identified that some of the admail rates that are commonly used by charities and others doing major campaigns can see the potential for savings with the new rates for 2015. It is interesting to see this and perhaps it reflects a desire of Canada Post to see the postal system taking back some market share from email and other forms of campaigns.
Who else is raising transportation rates?
If you are in the midst of your 2015 budgeting and mail and parcel transportation is an important cost for your business, taking a more detailed look at each of these rate changes is a key exercise.
Want to avoid postage rate increases altogether?
Many businesses are learning how to streamline their workflow and use new technologies to avoid having to physically send mail. If you want to learn more about how to be one of these business please contact us and click here for more info on Document Management Solutions.
Photo Credit: Canada Post Logo, Canada Post Corporation