Thursday, May 24, 2012

How High is Too High?

There has been a lot of debate recently on how to solve the financial situation of the Postal Service. One of many proposed suggestions includes increasing postage rates to more closely match the current costs of delivering mail. While the many alternatives are still being discussed, the Royal Mail of the United Kingdom has recently made a change to its postage rates that dwarf all previous increases.

On April 30th, 2012, Royal Mail increased their postage rate for first-class mail from 46 pence to 60 pence. In U.S. dollars, that’s the equivalent of going from about 75 cents to 97 cents per stamp. The cost of their second-class stamp also increased from 36 pence (58 cents) to 50 pence (81 cents).

Here’s a history of U.S. postage rates since 1991:

- February 3, 1991          29 cents
- January 1, 1995           32 cents
- January 10, 1999         33 cents
- January 7, 2001           34 cents
- June 30, 2002              37 cents
- January 8, 2006           39 cents
- May 14, 2007              41 cents
- May 12, 2008              42 cents
- May 11, 2009              44 cents
- January 22, 2012         45 cents

Do you think the Postal Service should increase the price of postage beyond 45 cents? Comment here.

19 comments:

Grannybunny said...

I think an increase to 50 cents would be totally acceptable to most people. It would still be one of the best bargains in the World!

Anonymous said...

Each stamp increase just causes more grumbling from our customers. I think we should look into more option sizes in the Flat rate priority products.

Anonymous said...

Increasing postage is not always the answer. Let's start with the future retiree health benefits prefunding...employees that aren't even born yet. Consumers are getting hit on everything from gas to coffee. Let's provide the best bargin for our SERVICE to the American people of this great nation.

Anonymous said...

Every one of us should print this article and tape it next to our customer service counters!! Show people how good they have it.

Anonymous said...

"increasing postage rates to more closely match the current costs of delivering mail"

Sounds like common cents. If you and I had a business and our product cost 50 dollars to make but sold it for 44 dollars...

Anonymous said...

It doesn't matter what the price of stamps are if the requirement to pre-fund future retiree health benefits doesn't change.

Anonymous said...

How can we let our PMG cut our service standards, and then turn around and ask for a rate increase with a straight face? Are you kidding? I can see the headlines now!

Anonymous said...

No brainer

Anonymous said...

No, cut the pre-retirement benefits and let the American people actually afford something.

postmaster 28 years said...

With the recent mandate to deliver everything that comes into our offices on a daily basis, I think we need to start looking at the price of presort standard mail. I realize there is testing for all classes of mail, but when we are forced to handle pieces of mail that cost 14 and 15 cents each the exact same way as mail that costs 45 cents per piece - that just doesn't seem to make sense.

Anonymous said...

No for increasing prices--there are alternatives out there that can and are being used, so we need to find other ways to contain costs and still remain an important viable source of communication for consumers. Are there travel costs for processes which can be automated? Are there people on detail accruing perdiem costs? are injury comp claims beings properly monitored?

Anonymous said...

Before we increase prices we need to get Congress to move and let us run the Postal Service like a business. No other firm in the country could lose what we lose every quarter and stay in business. Rase stamp prices so fewer people use the service. I agree with the person that said we need to look at the standard mail pricing. They may be our bread and butter but they are also raising our costs of doing business.

JoAnna said...

My husband and I were just talking about how much we've seen the price of stamps go up in our lifetime. I think it's a natural economic curve - the higher the price goes, the fewer stamps people will buy.

Anonymous said...

No! Let's right-size first, provide stellar service, improve our scanning and tracking, introduce useful products (digital). I also think there should be more encouragement to use first class mail through advertising or other means. By the way, the current denominations of domestic and international stamps are simply handy.

Anonymous said...

Most of the comments so far....well said. I totally agree with the 5/25, 6:58 posting. Details nationwide racking up costs of travel expense, apartment rentals, hotels, car rentals, milage payments and daily perdiems. Injury comp claims....another financial drain from scamming employees that want something for nothing. Every facet of this organization needs unbiased auditing. Don't put the burden of our financial crisis onto the American public. They have other options to choose from and they will utilize those choices costing us more lost revenue. Now is not the time to raise stamp prices as we cut service standards and customer service.

Anonymous said...

50 cents is acceptable if other
real cost savings actions are
taken. Maybe we should go back to
the old government run post
office. Use and help Amtrak which
is in the same boat.

Anonymous said...

An increase of $0.16 since 1991 (increase of 55%) may seem steep, but I did a quick check of new vehicles, as a comparison. In 1991, the average price for a new car was $16,000. Today, according to news reports, the average new car is $30,000, for an increase of 87.5%. To be fair, I checked the difference from 1975 to today (First Class Stamp was 0.10, new car was $4250). Mail increased 350% and vehicles increased 605%.

bharrelson said...

I think all of these points are valid. While I wish we could somehow force some of these issues, it just isn't going to happen.
On the other hand I agree that raising the cost of 1st class is the wrong way to go. Raise the price, people find other means. However, if the price IS raised again, it needs to be a significant amount. This penny at a time BS costs us more than the increase. The price should never go up less than 3 cents at a time.

Anonymous said...

End Saturday delivery. Why on earth was it ever started in the first place?