Prepare for the Upcoming Postage Rate Increase

3. Switch to a lower-grade paper. Changing grades can have an effect similar to changing the basis weight (see No. 2 above). But be careful not to go too far. Test a #5 grade, for example, against a #4 or #3. A slight reduction in paper grade can reduce your direct selling expenses and ratio.

4. Tighten your circulation. Higher postage costs will increase your break-even point. Don’t over-circulate catalogs to your housefile and prospects against your adjusted break-even point. A 15 percent increase in Standard A postage costs will increase your incremental break-even point 6 percent to 10 percent, depending on your catalog costs and gross margin percentage.