When postal rates go up on May 14, many small business owners will be looking for ways to save on their mailing costs. Many will switch to e-mail and other high-tech methods, while others will opt for smaller envelopes or thinner packages.
And some will take more drastic steps – such as abandoning higher-cost, low-margin parts of their businesses.
Steve Weber, who sells books online, already stopped shipping some lower-priced books in recent years because he simply couldn’t make enough of a profit as mailing costs increased. When rates rise again, he expects to pare his inventory further, discarding or donating books that would sell for $5 or less.
“I’ll probably downsize quite a bit and focus in on the items that are worth more money,” said Weber, adding that he’ll also be shipping fewer books overseas.
“The key to making money is to specialize,” said Weber, who runs his business, Weber Books, from Falls Church, Va. “You’ve got to focus in on markets like collectible cookbooks or poetry.”
The postal rate change that will send the cost of a first-class stamp up 2 cents to 41 cents will also make it more expensive for businesses to send most of their letters and packages. Evan Bloom, who co-owns a Sir Speedy printing franchise in Westbury, N.Y., said that while in the past the U.S. Postal Service based its prices on weight and size, now thickness of a letter or package is being thrown into the mix.
He noted, for example, that a business sending out a letter with a complimentary pen to a prospective customer has only had to worry about the weight of the package. But as of May 14, the thickness of such an envelope will figure into the cost because the pen will make it harder for the package to be sorted.
Bloom said many companies will be able to save on postage costs by using different size envelopes or making smaller mailings. But, he said of the increase, “there’s no way to avoid it entirely.”
The postage rate hike follows by several months rate increases at package delivery services including FedEx Inc. and UPS Inc. And so the higher cost of mailing and shipping is likely to make many small businesses turn to e-mail and Web-based mail to send out letters, reports, presentations, projects and more.
Andy Abramson, chief executive of Comunicano Inc., a Del Mar, Calif.-based marketing firm, said his company uses e-mail and the Web to send and receive most of its documents, bills and letters. For larger mailings that are too big for some Internet service providers or servers to handle, Comunicano relies on companies that deliver PDF files.
Business owners wanting to learn about the various high-tech ways of mailing need only talk to other, more tech-savvy entrepreneurs, or to search the Web. While there are many sites run by companies wanting to sell you services, you can still learn about your options without signing up. You can also get some help from SCORE, the organization of retired executives who counsel small businesses for free; its Web site is www.score.org.
But Abramson, who noted that he is the son of a postal worker, said businesses shouldn’t expect to abandon regular mail altogether. Some pieces of mail can have an impact – especially an emotional impact – that e-mail and PDF files just can’t deliver.
“There is something special about receiving a card, or a calendar that goes on your wall,” he said.
Joyce Rosenberg writes about small business for the Associated Press.
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