POSTAL RATE CASE UPDATE: Catalogers Must Take Immediate Action on USPS-PRC Rate Diferences, Vendors Say

The rates proposed by the PRC are more than five times the rate of inflation, about twice the rates proposed by the USPS, and are being proposed well after our budget has been set. They will make some of our planned circulation unprofitable, so we have no choice but to cut out those unprofitable catalogs. The net effect will be a loss of volume for the USPS, and the loss of volume will only grow worse as the full effects of the rates are felt in 2008 and beyond, along with any new rate increases. I expect the proposed rates to reduce mailing volume throughout the catalog industry, resulting in less prospecting names for 2008, and the risk of a downward spiral in Standard Mail volume for the USPS. In addition to negatively impacting our catalog circulation, this postal increase will significantly affect our company’s profitability and future employment levels.