Looking to reduce your mailing costs?
According to National Federation of Independent Business, most small businesses spend approximately $338 per month on postage, or about $4,000 a year. This postage is used to send mailings such as invoices, billing statements, marketing pieces, or products that are being shipped to customers.
Regardless of what your business is sending, a postage meter may save you money.
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Research suggests that an average business will save 20% on their mailing costs once they start using a meter.
Why? The meter assures that the postage calculation will be accurate and overpayment will not be a problem. Also, nearly all metered mail qualifies for $0.01 savings per letter weighing up 3.5 ounces when compared to the use of traditional stamps.
With savings like that, it’s easy to see why there are currently over a million postage meters in use, accounting for over a third of all postage revenue.
Essentially, a postage meter will help you weigh, scan, print, and process all outgoing mail. This, in turn, will not only save you money but also time and hassle.
For smaller firms, a machine which manages the entire mail process frees up employees to carry out other duties. Likewise, for larger companies who deal with mass mailings, brand promotion, or B2B correspondence on a regular basis, having a fully-integrated postage meter can allow completion of projects on a much shorter timescale.
For those businesses who process large volumes of mail or are looking to make a professional impact on their mailpieces, it’s important to first understand the various types of postage as well as the types of mail that are recognized by The United States Postal Service (USPS).
Did you know that postage is considered a type of currency by the U.S. government? Stamps, which you are probably most familiar with, have their monetary value printed directly on them. Nowadays, however, you can also print your own postage with a PC/online postage service or a postage meter. Therefore, printing postage is essentially like printing money and is strictly regulated. While costs of postage meters are determined by the supplier, the cost of postage is determined by The United States Postal Service.
As of January 22nd, 2017, the cost of First-Class letter stamps for standard-sized, rectangular envelopes is $0.49. However, not all pieces of mail meet the requirements to be sent as a letter, nor will all pieces be sent via First-Class. Depending on the class of mail, the size and weight of the mailpiece, and whether you qualify for commercial bulk mail rate discounts, the type of postage you affix and how much you pay for it will vary greatly.
So, what are the various types of postage?
Traditional stamps are best for personal use and businesses that only send a handful of letters per day. They add a personal touch to your mailpiece and may give customers an added incentive to open and read your mail.
They are easy to use and since there are no additional costs (such as monthly payments, permit payments, or startup and maintenance costs), they are also the cheapest for relatively small amounts of mail. Although stamps never lose value, as postage prices increase, you may need to add additional postage to ensure your mailpiece is delivered.
That’s what make-up stamps are for. These are available in denominations of a few cents, and are most common around the time of postage price changes. You affix these to your mailpiece alongside a traditional stamp to make up for the difference.
You could ensure your stamps are always worth the correct amount by purchasing “Forever” stamps. The USPS first released these in 2007. With these, you buy stamps at the current price and can use them to mail First-Class letters, even if postal rates go up. They never expire or decline in value.
There are also semipostal stamps, which cost more than traditional stamps even though they have the same value. This is because they include a surcharge to raise money for a charitable cause. For example, as of May 2017, the Breast Cancer Research Stamp has raised over $84.4 million for breast cancer research and the Save Vanishing Species Stamp has raised over $4 million to help protect threatened and endangered species. Fittingly, semipostal stamps are also known as charity stamps or fundraising stamps.
Lastly, there are precanceled stamps. These are special stamps that come in small denominations and are specifically for Presorted First-Class Mail, USPS Marketing Mail, and Nonprofit USPS Marketing Mail. These are affixed to your mailpieces much like traditional stamps. However, with these, you affix a lower rate of postage and then pay the difference when you drop off your mailings with a check, meter strip, or through a postage account. Precanceled stamps can be purchased from the post office in coils of 500, 3,000, and 10,000. There are no savings for buying large quantities of precanceled stamps.
Although stamps don’t have any additional costs and are easy to use, if your business is spending more than $50 a month on postage, you will benefit most from a postage meter.
If your business only ships a few packages a month, using a permit imprint is another option to pay for postage. With this, you create an online postage account with USPS (called an “advance deposit account”) that you will deposit money into. This allows you to print postage information onto your mailpieces. When you bring your mail to your post office or Business Mail Entry Unit, the total postage is deducted from your account.
The key to permit imprint is identical weight pieces. Generally, all your mailpieces must weigh exactly the same since you won’t have pre-paid postage affixed and USPS will need to verify the weight and number of pieces in your mailing. Consequently, you may end up overpaying for postage since you’ll have to stick to Priority mail, which uses approved boxes and envelopes, paying a flat fee for each size.
Postage meters and PC postage products are collectively identified as “postage evidencing systems”. This type of postage allows you to prepay and print indicia stamps in red, fluorescent ink onto each mailpiece. Indicia refers to any marking on address labels or bulk mail that is used as a substitute for stamps to show that postage has been paid.
Similar to permit imprint postage, you fill your account with money in advance and replenish it as your balance runs out. The difference here is that your account will be deducted as the postage is printed rather than when your mailings are dropped off at the post office.
The actual “stamp” that is printed is an Information-Base Indicia (IBI), a data matrix in the form of a 2-D barcode which contains information about the mailed item; this includes how much postage was paid, the weight of the item, the class of the mail, the licensing post office, the zip code of the mailing company, as well as the device or meter ID number. Some may also contain information that can be used to track an item through the postage system.
This 2-D barcode was designed to give USPS greater visibility and security of mail. It also removes levels of sorting within the mailing process cycle, which ultimately speeds up delivery.
Furthermore, you can send out any class of mail, except for Periodicals, in any quantity at any price with your postage meter or PC postage. Considering only 4% of small businesses use Periodicals class mail, this most likely won’t be a deal-breaker.
The major difference between PC postage and postage meters lies in equipment and internet connectivity. Online/PC postage is simply USPS-approved third-party vendor software that you will use to pay for and print postage. Since PC postage then requires internet connection as well as a separately connected digital scale and printer, this increases the likelihood of one or more components malfunctioning.
With a postage meter, all the components you need to weigh your items and print postage are already integrated into one machine, and you will not necessarily need an internet connection to apply postage to your mailings. .
One advantage to PC postage is that you have the option to print addresses onto your mailpieces at the same time as the postage. However, if you pre-print addresses onto labels, either this feature or your labels will become unnecessary and wasteful.
The U.S. Postal Service processes approximately 509 million pieces of mail each day. Each of these pieces are categorized by two factors: their size and their class.
There are different prices and different standards for preparing your mail depending on the size of the mailpieces. Each piece of mail will fit into one of four categories: postcards, letters, flats, or parcels. So, what does USPS define as a “flat”, and what makes it different from a letter or postcard?
Just because a mailpiece is a single sheet of paper, that doesn’t necessarily mean it is a postcard . According to USPS, to qualify as a postcard, it must be (a) rectangular, (b) at least 3 ½ inches high x 5 inches long x 0.007 inch thick, and (c) no more than 4 ½ inches high x 6 inches long x 0.016 inches thick.
This is probably what you imagine when you think of a standard piece of mail, a No. 10 envelope, which is designed to hold a 8 ½ inch x 11 inch piece of paper when folded into three sections. To be technically classified as a letter, a mailpiece must be (a) rectangular, (b) at least 3 ½ inches high x 5 inches long x 0.007 inch thick, and (c) no more than 6 1/8 inches high x 11 ½ inches long x ¼ inch thick.
Flats, also known as “large envelopes”, are similar to letters but exceed one or more of the size requirements for that category. Therefore, to be considered a flat, this piece must (a) have one dimension that is greater than 6 1/8 inches high OR 11 ½ inches long, OR ¼ inch thick, and (b) be no more than 12 inches high x 15 inches long x ¾ inch thick. Typically, these pieces of mail are oversized envelopes, newsletters, and magazines.
Parcels, then, are essentially any piece of mail that cannot be classified as a postcard, letter, or flat. Generally, commercial parcels must be at least 3 inches high x 6 inches long x ¼ inch thick. However, no mailpiece may measure more than 108 inches in length and girth combined and the maximum weight is 70 pounds (except for USPS Retail Ground and Parcel Select).
There are also “machinable” parcels, which are less expensive to mail since they are easier to process and deliver. This is because they have been prepared to be processed on postal service equipment. To be considered a machinable parcel, a mailpiece must measure (a) no more than 27 inches long x 17 inches wide x 17 inches high, and (b) no more than 25 pounds (35 pounds for Parcel Select and Parcel Return Service, except books and other printed matter which cannot exceed 25 pounds).
In addition to the size and shape of a mailpiece, The Postal Service also divides mail into different services, called “classes.” Each class of mail has different features, service levels, postage prices, and presort requirements. USPS provides a basic description of each class:
Priority Mail Express: Anything mailable, letters, merchandise.
Priority Mail: Anything mailable, bills, invoices, personal correspondence, merchandise.
First-Class Mail: Anything mailable, bills, invoices, personal correspondence, merchandise.
Periodicals: Newsletters, magazines; (formal authorization needed).
USPS Marketing Mail: Advertisements, circulars, newsletters, small parcels, merchandise.
Package Services and USPS Retail Ground: Merchandise, catalogs, printed material, computer media.
For most mailpieces, the class of mail you select will be determined by the content of the material and postage. Unsure of what class your mailpiece(s) should be? Contact your Business Mail Entry Unit. Also unsure how much it’ll cost? Refer to the USPS Price List (effective January 22, 2017).
Now that you’re familiar with the various types of postage as well as how USPS categorizes mailpieces based on its size, weight, and class, it’s time to learn about a machine that can help streamline the entire mailing process as well as reduce mailing costs.
A postage meter, also known as a mailing machine, simplifies the process of sending large amounts of mail by allowing you to weigh mailpieces and print the correct postage. No more waiting in line at the post office to buy stamps because you ran out, no more delivery delays because you didn’t apply sufficient postage to your parcel, and no more overpaying on postage either.
All postage meters today must be digital. Earlier, non-digital models have been discontinued to improve security. Depending on the model, you can use either your telephone line, your network or broadband router connection, or your Wi-Fi to allow your meter to download postage.
Basically, you purchase new postage (which can be charged to a credit card) at the current rate and it will then be downloaded directly into your meter. Your machine is now pre-filled with a set amount of postage. If sending a package or envelope that requires extra postage, meters come with postal scales which are often integrated into the meter itself. Just use the scale and the correct postage is determined and set automatically.
Indicia will then be printed directly onto the envelope as it’s automatically or semi-automatically fed through the meter. To send out a parcel, you will run a self-adhesive meter label, or meter tape, through the postage meter and affix to your mailpiece.
Before you meter any pieces, make sure you have the right markings for the class of mail and price. USPS spot checks mail at least once a quarter to confirm the postage indicted on items tallies with the fees paid to USPS.
Postage meters come in all shapes and sizes, from small meters that can fit snuggly on top of your desk to large, specialized mail hubs that require a dedicated space of their own. Nevertheless, there are several basic components to a postage meter that come standard regardless of its size.
Postage meters will have the actual meter (which prints the indicia and stores the postage) and a base. By law, customers are not allowed to open the meter component of the postage meter since it contains live postage. The base, however, is typically composed of four main parts: feeder, sealer, stacker, and tape dispenser.
The feeder guides the envelopes through the meter, although some low-end meters may require mailings be hand-fed. The sealer, an optional feature, will moisten and close the envelope flap. The stacker then clears mail from the machine after it is stamped. For low-end machines, this is essentially a catch tray. However, high-end machines use a conveyor mechanism to move the stamped pieces away from the meter’s edge.
Lastly, there’s the tape dispenser. As previously stated, self-adhesive meter tape can be printed with indicia to affix to parcels or other mailpieces that can’t be fed through the machine.
The most beneficial function of the postage meter is arguably the scale. Calculating costs for heavier items can be difficult, and you may end up overpaying or may not add enough postage which means the item could fail to reach its destination.
The scale ensures that doesn’t happen as it is a very sensitive device designed solely for weighing items of mail. Interfaced models will automatically apply the correct postage amount when running the piece through the meter. Ultimately, your scale will save you money as no overpayment on postage will be made.
Scales come either as digital/electronic or mechanical. Digital ones are preferred as they are more sensitive and precise. Springs in mechanical scales stretch out over time which ultimately affect accuracy. Regardless, your scale should be calibrated periodically to make sure it is reading correctly.
Most modern postage meters have built-in scales, thus alleviating the need for a separate one, but digital scales can be connected directly. If you do purchase a separate scale, be sure it is from the same manufacturer as the meter to ensure compatibility.
As the frequency of heavier items being mailed increased over the years, postage costs too increased.
And with that, so did the incentive to commit fraud. This resulted in a congressional hearing in 1993 at which it was agreed that postage meter technology needed to be improved in order to bring significant levels of fraud under control.
By January 1, 2009, only digital postage meters were permitted to be rented/leased. No non-digital meters may be rented and, as a result, many machines have been discontinued. With this pressure for postage meters to be technologically advanced for security reasons, along came vast improvements in features and options.
Since postage meters hold live postage, which is considered actual U.S. currency, they must be rented/leased and cannot be owned, regardless of manufacturer. The sale of postage meters is forbidden by federal law. This applies to new and old machines.
Furthermore, you cannot get a postage meter from USPS because federal regulations prevent USPS from competing with private enterprises. USPS only regulates the manufacturers that provide postage meters, they are not allowed to supply them.
Therefore, you will rent/lease a postage meter made by a USPS-approved manufacturer, of which there are only five. Regardless of what brand you choose, there are essentially just three categories of postage meters, typically identified by their output volume. Although this may sound limiting, postage meters have a wide variety of options and features to choose from, ensuring there is a mailing machine right for every budget.
All postage meters basically do the same job just with different speeds and features, although some have software connections to download account data. The biggest difference between postage meters, besides brand, is the speed in which they print postage on labels or envelopes. The smallest postage meters, for example, are designed to send less than 1,000 letters a month and require each mailpiece to be hand-fed. Whereas the largest capacity machines can process between 10,000 to 20,000 letters an hour.
Small businesses will only need an entry-level postage meter capable of weighing mailpieces and printing postage, which can cost as little as $25 a month. State-of-the-art models with high output volumes and added features, on the other hand, can cost over $1,000 a month, plus ongoing maintenance costs. Need something somewhere in-between? Then a mid-volume postage meter may be best for your business.
A low-volume postage meter is best for anyone that mails 1,000 items or less per month or spends less than $100 per month on standard USPS stamps. These machines will have all the standard parts we discussed previously and will be perfectly suited for a small business. These machines typically process around 18 letters per minute (lpm). Note that it may be easier and cheaper to upgrade your machine regularly rather than to rent “too much” machine at the onset.
Mid-volume postage meters are for those that send no more than 5,000 items per month and/or spend more than $150 a month on mail. Mid-volume machines often have similar features compared to low-volume models. The biggest difference between low- and mid-volume machines is the speed. These machines can typically process up to 155 lpm.
High-volume postage meters are meant for those sending more than 5,000 items per month. High-end meters can process up to 26,000 letters per hour. With higher processing speeds and capacity also comes added functionality. In fact, this is what makes the price margin increase so significantly between mid- and high-volume meters.
High-volume postage meters typically have heavy duty scales for weighing larger items, greater letter-per-minute capability, automatic and semi-automatic functions, as well as external keyboards and envelope sealers.
As stated previously, there are only five brands that are USPS-approved to manufacture postage meters.
Pitney Bowes produced the first commercially available postage meter, which was approved by the USPS on August 25, 1920. With 14,000 employees globally, over 95 years of innovation, and more than 1 million businesses supported by their products, they are one of the leading manufactures in the mailing solutions industry.
Neopost was founded in 1924 and is now recognized for their innovative technology. This includes a mini indicia print mark which minimizes ink consumption and “hot-swappable” ink cartridge units which can be changed without stopping flow of machine.
Hasler, which was acquired by Neopost in 2002, has a full range of digital mailing systems efficiently support mailing applications for any size office. Whether you’re a small office distributing a few pieces of mail each day, or a large corporation or busy mailroom processing up to 13,000 pieces of mixed-weight mail per hour, Hasler has your solution for fast and accurate mail processing.
FP has been manufacturing mailroom solutions since 1923. They introduced the first automatic postage meter, the first electronic postage meter, the first digital postage meter, and the first inkjet machine. With over 90 years in the industry and plugged into over 230,000 mailrooms worldwide, they continue to set the standard for developing innovative, class-leading mailroom systems.
Data-Pac is the youngest meter machine supplier on the U.S. market and first company to be approved to supply postage meters in more than 25 years. Data-Pac prides themselves on being able to offer cheaper mailing solutions for low-end meters and being especially software-driven. Their AMERICA2 Postage Security Device (PSD), for example, is the first postage meter to offer internet-based postage funds replenishment. They are Made in the USA.
Although you are not able to purchase or own a postage meter, if you wanted to own some element of the machine in order to reduce costs, you could invest in accessories and add-ons for your mailing operations, such as document trays.
You should also consider renting a postage meter with a built-in automatic envelope sealer. Automatic sealing machines are becoming increasingly popular and commonplace. This additional feature typically adds very little to original cost, but it’s a way of getting two pieces of highly convenient equipment for the price of one.
Many machines available today also include features for corporate promotion, allowing you to print marketing messages onto your mail alongside the traditional postage mark. machines have the capability to store eight or more different marketing messages in addition to a standard company logo. This offers businesses the chance to add a personal touch to their mailings, which may further entice recipients to open their mail. This is especially beneficial to businesses running direct mail campaigns.
In addition to the rental price of the meter itself and the cost of postage, there are several other expenses you should keep in mind. First, you should factor in the cost of ink cartridges for your meter. Not sure how to evaluate ink? One variable meter companies use is “imprint” or “impressions”, the ink produced in a single use. The relationship between ink and imprint varies by machine.
For example, a replacement ink cartridge for Neopost’s IS-280 iMeter (a low-volume meter) costs $106 and will print up to 1,900 imprints. To compare, Pitney Bowes replacement ink cartridge for their DM200, DM300, and DM400 series machines (low- and mid-volume meters) costs $159.99 and yields up to 7,000 impressions.
You must also consider the cost of shipping materials. This includes envelopes, boxes, and other packing materials such as tape, bubble wrap, or packing peanuts. These materials are typically cheaper when bought in bulk.
Over the course of a year, the price difference between mailing traditionally and mailing with a postage meter could lead to significant savings. Of course, the exact value depends on your company’s volume of mail.
So, you’ve metered all your mail, have the envelopes and parcels sealed, and you’re ready for your mailings to be sent to your recipients. Now what?
Most types of metered mail can be dropped directly into a collection box or be picked up by your mail carrier. According to USPS regulations, your mailings must be “at locations designated by the postmaster of the licensing post office shown in the machine stamp unless authorized by the Postal Service to deposit it at a different location.”
Take note that your mailings must be deposited into a mail collection box on the day it was stamped. For example, if it was stamped in the morning, it would have to be placed in your USPS-approved collection box by midnight.
If you fail to do this, the date can be corrected once, after which a new postage stamp must be applied. To correct a date, a new label must be printed with the new date for the postage and the postage amount should be set to zero. If you miss the date a second time, you’ll need to print a new label, which means paying twice. Pay attention to USPS’ calendar and your local post office’s hours. It may be helpful to wait on processing your mail (especially if it’s a larger batch) until you can be sure it can go out on time.
You must also present a postage statement with your mailing. You can do this either electronically or manually. The statement helps you figure out how much postage is due, if applicable, when you drop off your mail. You can pay the difference with a meter strip attached. There are different postage statements for each class of mail and each method of postage payment.
If you choose to manually complete your postage statements, you can download the form in PDF format from the USPS website. The titles of the postage statements are self-explanatory, so you’ll easily find the statement that’s right for your mailing. Use the Postal Explorer’s Business Rate Calculator to assist you in calculating postage.
If you qualify for discounted mail classes (such as bulk or presorted mail), then you will need to take your mailings to the post office where you hold permit to verify the correct postage has been added. These types of mail cannot be dropped in a collection box or given to a carrier.
If and when the Postal service implements a rate change, you will need to adjust your postage meter to ensure the correct rate is being applied when printing postage. For older model postage meters, your supplier will send you a new rate card or rate chip for your machine along with installation instructions. Newer models are capable of downloading the updates by connecting to the internet.
Some manufactures also offer an annual Rate Change Protection (RCP) contract, which will cover the cost of purchasing an individual update each time USPS changes their postage rates. This contract typically costs much less than buying multiple updates for your equipment.
If you make a mistake when printing postage, unused indicia or postage may be considered for a refund only if they are complete, legible, and submitted within 60 days of the date in the meter stamp. For specific details, contact your local post office.
Since postage meters cannot be purchased and must be rented/leased from a supplier, that means there will be some sort of contract involved. There are, however, several different factors you should keep in mind before you sign.
For example, fee structures vary greatly from one supplier to next, making comparison shopping a must. Some contracts are based on a fixed monthly fee while others are based on usage. Businesses with high mail volume, for example, will benefit most from a fixed pricing plan, but if mail volume is lower, or prone to fluctuation, a usage-based plan may be more cost effective.
Additionally, some suppliers have a higher monthly rent, but offer a lower fee for ink. This may be a good option if you only occasionally run massive jobs and maintain ink supply for a long time. Part of your licensing agreement also requires meter manufacturers to inspect their meters at least twice a year, while the USPS also inspects at regular intervals. Therefore, you should be aware if your contract includes after-sale support and routine maintenance in your monthly lease rate, as not all will.
Don’t want to bother with monthly payments? There may also be an option to prepay in advance of a contract rather than paying-as-you-go. Regardless of how you choose to structure it, many leases can be set up relatively quickly. But since you’ll be entering a contract that will likely last for a number of years, you need to take the time to ensure the agreement will be beneficial to your business.
If the appeal of a postage meter lies in its ability to send out mass quantities of mailings on a daily basis, you may be especially interested in being able to send bulk mail at a discounted rate. The term “bulk mail” refers to commercial First-Class Mail and advertising mail (called “USPS Marketing Mail”).
In order to send bulk mailings, you will need to apply for a permit, pay an annual fee of $200 (which allows you to send bulk mailings from one post office for one year), and stamp your mail with a special marking.
Want to reduce costs even more? You can presort your commercial bulk mailings. Commercial mailing rates are significantly lower than ordinary mail prices. To benefit from commercial mailing rates, you must presort into zip codes and sizes. This level of work can be eradicated by renting a postage meter designed to process bulk mail, or by using a third-party presorting service.
If something goes wrong with your postage meter, contact your supplier or manufacturer as many have local dealer networks with technical support representatives all over the United States. Remember, by law, customers are not allowed to open the meter component of the postage meter since it technically contains U.S. currency. So it’s best to have a knowledgeable and USPS-approved technician help you when troubleshooting your postage meter.
If you decide to switch meters, you should return it to the manufacturer. The money will then be refunded from the USPS for that account.
Whether you’re managing a small eBay or Etsy shop or your growing business is on the verge of becoming an enterprise, if you’re spending more than $50 a month on postage, you will benefit from a postage meter. This machine removes the need for petty cash, checks, and large volumes of stamps being held in your office.
In addition to saving money, one of the best perks of having a postage meter is knowing you’ll never have to drive to the post office and wait in line to buy stamps ever again.
How much mail do you typically send? What type of mail does this include (postcards, letters, flats, or parcels)? Do you require additional features (ability to print marketing messages, envelope sealers, heavy duty scales, etc.)? We hope we’ve been able to help you answer those questions. We’d also like to help you find the right supplier.
360Connect has already screened local and national suppliers for you. Our service is simple and easy to use, saving you time and money. First, you fill out our form and answer some simple questions about your needs. You’ll then receive free quotes from up to five qualified suppliers in your area. Finally, you choose the postage meter supplier that best serves your needs. It’s that easy.