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Posted by Mark Fallon on Sep 17, 2014 5:30:00 AM

“Cooperation gets teams pulling together. Staying focused on the organization's mission ensures they pull in the right direction.” – Eric Harvey
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Operations Management

2014 National Postal Customer Council Week

Posted by Mark Fallon on Sep 3, 2014 5:00:00 AM

In the springtime, many mailers attend the National Postal Forum to hear from United States Postal Service (“USPS”) officials and fellow industry professionals about the current state and future of our industry. In the fall, the focus shifts to National Postal Customer Council (“PCC”) Week, which takes place September 8 – 12 at multiple locations throughout the country.

In the past, this event was called “PCC Day” and was held on the third Wednesday in September. The Postmaster General would participate in a live simulcast from the city that had won the PCC of the Year award. PCCs needed to hold their events at a location that could broadcast a satellite feed of the speech. Usually after lunch for the East Coast, and breakfast for the West Coast.

A few years ago, “PCC Day” transformed into a week-long event. The Postmaster General pre-records his speech, and distributes it to the districts. This allows PCCs greater flexibility in selecting the location – and the day of the week – that works best for their organization. The result has been better turnouts across the country.

PCCs are an underutilized resource – by both the USPS and mailers. I know of no other industry where the customers volunteer to organize, and then pay for, educational events on how to use a vendor’s service better. USPS management needs to better use the PCCs as a two-way communication platform. The PCCs are a great way to distribute information to business customers, and educational seminars are needed.

But management needs to listen to the customers as well. Not just parry comments with prepared defenses of postal policy, but attentively listen and react to what the customers are saying. Large mailers may be represented by professional organizations, but the PCCs represent the small and mid-sized mailer as well. Business mailers – First Class, Standard, Package and Periodical mailers – represent the overwhelming majority of the USPS income. Their voice deserves to be heard, and their opinions matter.

Too many mailers don’t take advantage of the opportunities presented by their local PCC either. There are classes on postal regulations, USPS initiatives and industry trends. We’re in an era of transformative changes on how we create, print and prepare mailings. We owe it to our organizations to keep ourselves educated. And PCCs provide that educational opportunity.

To find more about your local PCC and their National PCC Week event, check out the PCC Locator on the USPS website. Or, call your local USPS District Business Service Network representative for more information. Most of the events are more than reasonably priced, so bring some of your co-workers with you. The benefits far outweigh the expense.

PS – I believe in practicing what I preach. I’ve been a member of the Greater Boston PCC for decades, and currently sit on their Executive Board. During National PCC Week, I’m presenting for 3 different PCCs – the Omaha PCC Advertising Expo on September 10, the Greater Kansas City PCC event on September 11, and the Carolinas (all 5 PCCs) Postal PCC Forum in Charlotte on September 12. As always, I’m waiving my speaking fees for these mailing organizations.

Hope to see you at a PCC event soon!


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United States Postal Service

Planning for the 2015 Postage Rates

Posted by Mark Fallon on Aug 27, 2014 4:30:00 AM

For most corporations, the budgeting process for 2015 has begun. Managers are calculating changes in volumes, adjustments to vendor contracts and requests for new equipment or software. One factor that’s difficult to estimate this year – postage rates.

Last December, the Postal Regulatory Commission (“PRC”) conditionally approved the US Postal Service’s (“USPS”) request for an exigent rate increase. That meant on January 26, 2014, postage rates increased an average of 6.0%.+ Read More

United States Postal Service

I Toured the Morgue, Not the Mail Center

Posted by Mark Fallon on Aug 20, 2014 5:00:00 AM

Last week, I was visiting with friends I hadn’t seen for a while. While catching up on each other’s lives, I shared some good news about my business. Recently, we’d been selected to design the mail center for a new hospital.

One of my friends, a nurse, asked, “Hospitals have mail centers?” Of course, how else do you think they handle all of the incoming and outgoing mail? I’m sure that they have a mail center at your hospital.

Her response – “I don’t know. When I started, we toured the morgue, but not the mail center.”

After I stopped laughing, I explained the different services the mail center at a hospital performs. Sorting and prepping inbound mail for delivery to the floors. Processing patient bills and other outgoing correspondence. Imaging documents for the hospital’s records department. My friend agreed all of this work had to get done, but she never thought of the hospital having a “mail center”.

Her attitude isn’t unique – and not just among people who work in hospitals. When we visit companies, many of the employees don’t realize that there’s a mail center for their organization. Even when their department receives or sends large volumes of mail. The mail arrives and the mail goes out. No one gives a second thought on how it happens.

Often the mail center is so physically removed from the rest of the company, that no one ever has a reason to go near the shop. In many cases, the operation is located in the basement, next to the loading dock or in a separate building (at one hospital we worked with, the mail center was next to the morgue). Out of sight, out of mind.

The mail center manager needs to accept some of the responsibility for this mindset. While we may not be able to change the physical location of the operation, we can work on changing the attitude of the people around us. We can promote the department through an internal customer communication plan. Using email, the company’s intranet and newsletters, we can inform them about the services we provide for the company.

We can make sure that the department’s space is kept tidy and neat. Even though large quantities of paper, packages and mail pass through the shop, the area can be organized. While employees are required to perform physical labor, they should be dressed neatly and professionally. Equipment, counters and shelving must be kept clean when not in use.

The department should offer regularly scheduled tours promoting its capabilities. Managers can volunteer to brief all new company employees during orientation. In addition to explaining how to use inbound and outbound addressing, the briefing could end with a tour of the mail center. Separate tours could be held for new officers or executives.

We live in a digital age, but physical mail is an integral part of any company’s communication plan. Make sure your fellow employees – your internal customers – understand how you contribute to the company’s success. And make sure they know where the mail center is located.


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Invest In Your Future

Posted by Mark Fallon on Aug 13, 2014 5:00:00 AM

"You can finish school, and even make it easy--but you never finish your education, and it's seldom easy." -  Zig Ziglar

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Operations Management

The Domestic Mail Manual: Good, Not Great

Posted by Mark Fallon on Aug 6, 2014 5:00:00 AM

When I started in the mailing industry (way back in the 20th century), the Domestic Mail Manual (“DMM”) was a bound, hard-copy reference book. Having the look and feel of a phonebook for a major metropolitan area, the DMM was regularly criticized for the small print, lightweight paper and dizzying cross-references. Updates and corrections had to be stored in a separate binder.

However, being a true “mail geek”, I looked forward to its annual publication. I would spend a weekend reading all the sections impacting First-Class Mail, adding tabs for key areas on mail preparation. I would carry the DMM with me when meeting with US Postal Service (“USPS”) representatives. This was very helpful if there were any disagreements on a particular mailing my company had submitted.

In 1994, the USPS announced it was streamlining the DMM, making it more accessible, easier to use and more convenient to update. The new format included the migration from bound book to a 3-ring binder, larger font sizes and heavier paper stock. Updates would be sent as shrink-wrapped packages to replace entire sections.

Unfortunately, this also meant increasing the physical size of the DMM. The hefty 3-inch binder wasn’t as easy to flip through, nor simple to put in a briefcase when going to a meeting. I created an “alternative DMM” binder, containing only the sections that impacted my mailings.

About this same time, the first digital copy of the DMM was produced by Window Book, Inc. Available as a package of 3.5-inch diskettes, the digital DMM could be loaded onto the hard drive of a computer, and then searched by key terms. Although basic by today’s standards, this was a significant leap forward for DMM users.

That lead to the current on-line DMM, available through the USPS Postal Explorer website. Now, when users search for a particular term, the website not only returns DMM citations, but also information from Quick Service Guides and Customer Support Rulings. And for people like me, you can download a complete DMM to your hard drive.

In addition to the improved search functionality, updates to the online DMM are seamless through the DMM Advisory system. Users can see the latest up dates by visiting the DMM Advisory website, or they can sign up for email alerts by sending a request to The alerts include proposed changes to the DMM, as well as price adjustments or USPS filings in the Federal Register.

Overall, the new DMM is much better than the hard copy “phonebook” we used 20 years ago. The USPS continues to streamline the manual by eliminating duplicate sections or conflicting regulations. The DMM Advisory alerts help conscientious mailers stay up to date with new and proposed changes.

But the system still needs improvement. Any search engine is only as good as the terms users enter. Mailers still need to read through not only the Quick Service Guides, but all the related DMM sections when preparing a mailing. And some requirements, like the Intelligent Mail Barcode and e-Doc specifications, aren’t in the DMM, but are separate publications on the National Customer Service or “RIBBS” website.

Individual interpretation of the DMM – by mailers and USPS acceptance clerks – can still differ. For example, I recently participated in a discussion about a multiple choice question. Here’s the question and responses:

Question: Effective January 28, 2013 mailpieces bearing a POSTNET barcode are eligible to claim the ________ discount.
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Managing Multiple Sites

Posted by Mark Fallon on Jul 30, 2014 9:43:47 AM

“Congratulations! Since you’ve done such a good job with the Boston operation, we’re now putting you in charge of the New York and New Jersey operations as well.”

Despite the positive tone in my boss’s voice, I wasn’t sure that was good news. Yes, we’d been able to make some positive changes in the Boston mail and distribution center. But could I effectively manage three operations in three different cities? Soon, I was going to find out. And the lessons I learned would come in handy when a similar opportunity arose at another company five years later.

Whether managing one site or five sites, continue to use the basic management techniques that have made you successful. Developing a solid business plan; communicating that plan to all involved; knowing your customers; and motivating employees remain the foundations upon which to build. The only change is the method you use to execute those practices.

Although you’ll probably modify it before everyone’s had a chance to read it, you need to develop a business plan for the short- and long-term. This is your opportunity to share your vision for the unit with management and employees. Use the plan to explain where you want the unit to be in six months, a year, even five years. Circumstances will dictate changes (some drastic) to your plan. But as the saying goes, failure to plan is a plan for failure.

The plan should represent your unit as a whole and not each site individually. Though the sites may serve different clients and have completely different functions, they must see themselves as part of a larger team. The business plan is the place to start building that sense of team. Everyone needs to know how they can contribute to the big picture.

How you communicate that plan is essential to its success. You can’t deliver every message personally, and you can’t be in two cities at the same time. Even with cities in relative proximity, you can’t be on the road all the time and remain effective. You must choose one site as your base of operations, spending most of your time there.

However, don’t let that base become an isolation booth. Make sure that you reach out to the remote sites at least once a day. Send a short email update. Make a quick phone call. Or hold a virtual meeting, using Web conferencing. Whatever the method, use these opportunities to disseminate important information and provide support. Don’t turn your communication into a daily “big brother” surveillance tool.

Plan onsite visits on a regular basis, at least once a month. Schedule one-on-one time with the site manager. Introduce yourself to new employees and welcome them to the team. Make sure you spend some time on the shop floor with the employees. Shake hands, ask how things are going, and take the pulse of the unit. Remember: there’s no such thing as a typical day. But if things don’t feel right, schedule a return visit soon.

Use these visits to meet with your major clients at that site. If possible, form a user group with open forums. Have your site manager sit next to you at these forums, reinforcing the concept of one team. Take notes on compliments and complaints. When you return to your office, prepare written minutes and responses to any questions and concerns. After reviewing this document with your site manager, distribute the information to the whole group.

Also, when onsite, schedule “face time” with the highest ranking manager of the business unit or their deputy. Don’t worry if you only get 10 or 15 minutes of their time. This is just another way to emphasize that you care about your internal customers and that you’re aware of what’s going on. Again, follow up on any concerns with an email or phone call as soon as possible.

When you’re back at your home office, be sure to respond quickly to any phone calls or emails from remote customers. In fact, you need to respond to these requests faster than those from people at the home office. Because these customers aren’t located close to you, they may feel isolated and less important. Go the extra mile to reassure that distance has no impact on service, and that your onsite manager is more than capable of meeting their needs.

Keeping your employees motivated from a distance will probably be your greatest challenge. You need to be proactive in this area to counter the perception of “out of sight - out of mind”. When an employee anywhere in your organization does something commendable, call them immediately and thank them. Don’t substitute an email for a phone call, and don’t just leave a voicemail. Take a minute to have a conversation with this person and reinforce how important their actions were.

Keep a list of these events, and make sure you recognize people in front of the entire group during your next onsite visit. And any team successes should be recognized at all locations. If your New York unit set a record on getting the monthly shipments out early, don’t just celebrate in New York. Have celebrations in every location, strengthening the concept of team.

The key to success in each of these areas is the site manager. They must be an independent person, and a strong supporter of the team concept. Your site manager needs to keep the lines of communication open; sharing ideas, news and events. Most importantly, they must be confident enough to get any bad news to you as soon as possible, especially if it involves customer service.

Similarly, you must trust that manager to make the right decision. With the exception of hiring and firing employees, you must empower the site managers to do what they think is best. Often important decisions will have to be made without consulting you first. Make sure they inform you of these decisions as soon as possible. When people make errors in judgment, be careful with your critique. You want your managers to make a better decision the next time; you don’t want them to freeze and take no action without your prior approval.

Managing operations in multiple locations is a challenge for any manager. Time and travel will force you to be a better planner, communicator, motivator and delegator. Stretching these basic skills will shorten the distance to success.



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Operations Management

Postal Reform: No Hope in Sight

Posted by Mark Fallon on Jul 23, 2014 5:00:00 AM

For several years, the leadership of the United States Postal Service (USPS), the postal employee unions, and the mailing industry have clamored for postal reform. Under the Postal Accountability and Enhancement Act (PAEA) of 2006, the USPS has had to pre-fund future retiree health benefits, creating a $5 billion annual liability. Adding to the problem, the USPS has overpaid billions into the Federal Employee Retirement System. And mail volumes have declined (but not as much as many people think).

Congress has responded quickly – by doing nothing. There are over 30 bills in the House and Senate dealing with different aspects of postal reform. Only two bills – H.2748 and S.1486 – have been approved by the respective oversight committees. That was months ago, and neither have been brought to the floor for a vote. Probably because there are competing bills in each chamber that have more supporters, including a lot of bipartisan agreement.

The USPS Board of Governors is the equivalent of a board of directors of a private corporation. The Board is composed of the Postmaster General and 9 members who are appointed by the President with Senate approval. Since President Obama has taken office, the terms of 5 Governors have ended, and he has submitted the names of Republicans and Democrats as nominees. And waited. And waited.

Last week, the Senate held a confirmation hearing for 4 of the nominees. The committee chairman, Senator Carper, began the hearing with a statement on the importance of the USPS to the nation’s economy and the millions of people who work in the print and mail industry. He was the only member of the committee present. His Republican co-chair’s plane was delayed, but there was no explanation for the absence of the rest of the committee. Nor has a date been set for a vote on the Senate floor to finalize their confirmation.

The passage of a postal reform bill will be a contentious issue. While everyone agrees change is needed, there’s little agreement on what those changes should look like. It will take tremendous effort and compromise by all parties to create a solution that will resolve at least some of the issues impacting the USPS. It will be hard work.

However, the Congress has allowed the USPS Board of Governors to dwindle to less than half of its required appointees. The confirmation process wasn’t held up by the filibuster or other procedural delays. It’s just that nothing happened. Two more Governors’ terms expire in December.

If the routine procedural confirmation of these nominees can’t be completed in a timely manner, if committee members can’t make the time for these hearings, is there any hope for comprehensive postal reform in the near future?


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United States Postal Service

First-Class Mail Volumes: Facts and Fiction

Posted by Mark Fallon on Jul 9, 2014 5:00:00 AM

News stories about the United States Postal Service (“USPS”) usually include a statement about declining mail volumes. Often prefaced with, “due to diversion to the electronic communication” or “because of the internet”, the reporter or columnist will paint a dreadful picture of the state of the USPS. Hard copy bills and statements are derided as “snail mail”.

If posted on a news website, the readers' comments that follow are even more derisive. “I receive and pay all of my bills online.” “Who needs mail delivered to their house?” “The USPS is like buggy-whip factories in the age of the automobile.” Of course, these commenters have an active online presence, so their view is slightly skewed.

Mail volumes have declined considerably over the last decade. First-Class Mail – bills, statements, letters and payments – has been significantly impacted by online options. The USPS delivered 35% less First-Class Mail in 2013 than they did in 2004. However, the types of mail that have declined, and the rate of decline tell an interesting story.

The largest components of First-Class Mail are “Single Piece”, “Workshare” and “Post Cards”. Single Piece mail is composed of mail being deposited with the USPS at the full postage rate, with either a stamp or meter imprint. Much of this mail are payments being sent from consumers to companies and banks. Workshare mail is when companies presort their mail by ZIP Codes, and then receive a discount from the USPS. This is mail sent by companies to their customers. Post Cards can be sent at full rate or at a discounted rate.

The biggest drop in mail volumes has been with Single Piece mail. In 2013, the USPS processed 23.6 billion fewer pieces of Single Piece mail than in 2004. This makes up more than 73% of the total decline in First-Class Mail volumes. Much of this decline is caused by more people paying bills either online or through automatic withdrawal from their bank accounts.

Workshare mail has also declined significantly, but not as much – only 18% over the last 10 years. Some people have elected to have their bills and statements delivered electronically, just not as many as reporters seem to think. And not as many customers as most companies would prefer.

But electronic diversion is only part of the reason for the decline in hard copy mail. The most significant drop in mail volumes occurred during the Great Recession (2009-2011). The USPS saw a loss of over 19 billion pieces of First-Class Mail during this time period, representing 60% of the decline for the entire decade.

As the chart below shows, mail volumes continue to fall. However, the rate of decline has slowed considerably. In 2012 and 2013, there was only a 5% and 4% drop in First-Class Mail volumes respectively. The first 2 quarters of 2014 shows the trend continuing, with only a 4% reduction in volume. Significantly, Workshare mail is down only 3%, with the 2nd quarter of 2014 having almost the same number of pieces as 2013.

What does this all mean for the USPS and its customers? The drop in First-Class Mail volume is significant, but the rate of decline has slowed considerably. People are paying more bills online, but prefer to receive paper copies of their bills and statements. Mail volumes being delivered to businesses and banks will fall quicker than mail being delivered to households.

Physical mail remains a critical link between businesses and their customers. Companies need to remain flexible, offering their customers the ability to receive communication in their preferred format – electronic and paper. The USPS must remain committed to accepting and delivering physical mail in a cost-effective, customer-centric and timely manner.

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United States Postal Service

Effective Material Handling: Part Two – Storage

Posted by Mark Fallon on Jun 25, 2014 5:00:00 AM

In our last blog post, we reviewed the 7 characteristics of paper that have a direct impact on the efficiency of your equipment. Quality materials will conform to vendor specifications and US Postal Service publications. Testing is an integral function to ensure that your materials meet industry standards.

Your quality paper and forms also need to be stored properly. If you use an offsite warehouse, ensure the warehouse has some type of climate control. If your operation is located in an area with extreme weather conditions (e.g., very cold or very hot), climate control is especially important.

Keep the storage area's climate consistent. The temperature should stay between 64 and 80 degrees Fahrenheit. Relative humidity should be maintained between 40 and 60 percent. Invest in a wall monitor that displays and records temperature and humidity readings. Report any significant fluctuations to facilities management, and schedule quarterly meetings to discuss any improvements.

Materials should be stored in their original packaging for as long as possible. The cardboard and shrink-wrap provide added protection from climate changes. Also, the covering will minimize any damage when moving paper from storage to the production area. You should also store material up and away from concrete floors and walls. Install shelving with at least a four-inch clearance from the walls. If shelving is not an option, use the pallets on which the papers and forms were delivered.

You'll need to recondition material after moving it from storage to the operations area, allowing the paper to sit in the same environment as the equipment to adjust to the climate change. The greater the temperature change, the more time the material will need for reconditioning. Vendors recommend at least four hours for every 10 degrees in temperature change. However, whenever possible, allow 24 hours of reconditioning for optimum performance.

Monitoring and metrics

It's important to establish a method of continuous monitoring of material quality. Set up a quality control station to test all new applications and forms. Train the receiving area to spot and report any damage as shipments arrive. Work with the U.S. Postal Service, consultants, paper suppliers and equipment vendors to set standards and testing procedures. Track and report the effects that poor quality materials have on production time.

And remember that paper suppliers use different mills and factories to produce your forms. While the bulk of the forms may come from one facility, the vendor may need to redirect work due to time constraints, capacity issues or disaster recovery. Require that testing be done at each mill/factory, using the same standards. Ensure the paper source is identified on all packaging and bills of lading.

Printer and inserter manufacturers are "pushing the envelope" on how fast their machines can process a piece of paper. New inks, glues and finishing elements create new opportunities for how companies can produce creative hardcopy messages. But that technology is dependent on using quality paper and forms.

For the immediate future, paper will retain its importance as the preferred method for receiving bills and statements. Physical mail is an essential component in integrated marketing campaigns. Start a quality program now for your paper and forms, and take advantage of new technology to produce superior documents for your customers and prospects.


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Operations Management

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The Berkshire Company improves business processes in your print & mail operations, helping you solve real problems.

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