Some local businesses are considering redesigning their mailings to avoid substantial increases in costs under new postal regulations.
On Monday, new postal rates that base charges on the shapes of pieces of mail went into effect. The new regulations mean larger envelopes and packages will cost more than smaller mail.
In the past, most postage was determined by weight.
The change will increase Xcel Energy’s mailing costs in its eight-state service territory by a minimum of $50,000 a year, said Xcel spokesman Tom Henley. The company will pass the increased cost along to customers at some point in the future, he said.
Denver-based Qwest sends out millions of pieces of mail each year, said company spokesman Bob Toevs. The company is working with the U.S. Postal Service to make sure its mailings are designed to avoid higher rates, he said.
“We will be designing pieces to meet their requirements,” Toevs said. “The Postal Service is helping our designers to work through their requirements.”
Some businesses could see mailing costs rise as much as 60 percent because of the changes, said Paul Del Toro, director of special programs for DMX Direct in Littleton, a full-service direct-response marketing company.
DMX, which provides services that range from designing packaging and printing mail to arranging bulk mailings, is helping some of the businesses that use its services redesign their mailings to minimize the effect of the changes, Del Toro said.
DMX handles mailings for businesses that include financial-services firms and biotechnology companies.
“We have a very diverse client base, and it is impacting everyone in one way or another. Obviously, the larger the mailer, the more it will hurt,” he said.
Greenwood Village-based eBags, which sells bags and accessories, is considering doing away with its print catalog, which it mails to consumers several times a year.
“Typically in the past, we produced over 4 million product catalogs,” said Peter Cobb, eBags co-founder and senior vice president. “The postal rates have caused the company to rethink its strategy in terms of reaching customers. That’s a huge challenge in reaching a segment of the population not familiar with online shopping.”
Metropolitan State College of Denver has cut down on mailings since it launched its website, Metro Connect, in 1994, said Metro State spokeswoman Kathy Lucas. The school is encouraging its departments to use e-mail and the website rather than regular mail.
Landscaping companies that rely on mail to advertise their services will see their costs grow thanks to the change, said Kristen Sirovatka Fefes, executive director of the Associated Landscape Contractors of Colorado.
Swingle Lawn, Tree & Landscape Care sends hundreds of thousands of pieces of direct mail each year, and some of those have been printed, said John Gibson, Swingle director of operations.
“There are some things we have already preprinted, and we are stuck with whatever the increase is going to be for them,” Gibson said.
Some of the mailings are large and oddly shaped to stand out from other mail and grab the attention of those who receive them, Gibson said.
The new rules are likely to boost Swingle’s costs, he said. So the company is considering how to change its mailings to keep the increase to a minimum.
Mail that has been sent as a flat sheet to display pictures could be folded in the future, Gibson said.
“This makes us step back and look at the shape, the weight of materials, the quality of printing” and other aspects of the mail, he said.
Shape-based pricing is standard throughout the shipping industry, said U.S. Postal Service spokesman Al DeSarro.
“We weren’t charging enough compared to other shipping companies,” he said.
The postage increase was needed to fund increased operating costs, DeSarro said.
Staff writer Tom McGhee can be reached at 303-954-1671 or tmcghee@denverpost.com.
Staff writer Kimberly S. Johnson can be reached at 303-954-1088 or kjohnson@denverpost.com.
