The USPS this week announced plans to lay off 28,000 workers by March as it closes 252 of its 461 mail processing centers across the country in a move that will save $3bn annually. The biggest impact will be felt in First Class Mail, where the USPS will no longer be able to deliver the next day. Instead First Class Mail will promise delivery in two to three days depending on location.

Since most direct mail is sent via Standard Mail (formerly known a Third Class Mail) Tom Foti, USPS Manager, Direct Mail & Periodicals, said there should be no cause for companies to accelerate their campaigns to get pieces into the system earlier. "In some instances, we may be asking customers to deliver mail to a different nearby processing facility, but that will not impact timely delivery of direct mail," he told PrintWeek.

Foti said the USPS has been talking with major direct mail customers on the latest changes, adding, "Certainly there has been some concern because things are changing, but the industry has been generally supportive of our efforts to ensure the long-term viability of the US Postal Service. At this point, I think there is a little bit of a ‘wait and see’ from customers, but I am confident, as we move through this process, they will gain confidence in the direction we are headed."

Foti also noted the proposed changes will not impact direct mail incentive programs like Reply Rides Free, which will be implemented in January. "We continue to explore other incentive opportunities to promote the use and value of direct mail and we don't expect any of these programs to be impacted by any efficiency initiatives we are implementing."

The USPS currently spends about 80% of its revenues on employee costs, including retiree benefits and health programs. That puts it at a disadvantage compared with FedEx, which spends only 23% of its costs on employees and UPS, which is about 50%. That combined with reports the service could lose as much as $14bn next year has once again triggered discussions in Washington about the eventual privatization of the service.

But for now, direct mail printers seem to be taking the changes in their stride. "We handle a significant amount of pre-sort standard mail, but we also handle a significant amount of first class mail, said David Fenske, partner with Rapid City, SD-based Fenske Media at a Kodak Media event this week (see related story). "But it will not affect us in terms of delivering products for customers."  

Fenske Media has a US Post Office on-site and other Fenske officials suggested the most recent changes could add about ½ cent per piece to its mailing costs, but noted that given there hasn’t been a postal increase in Standard Mail in two years, the latest move will have an minimal impact on theirs or their customers’ bottom line.