For the most part, mailers cheered when the U.S. Postal Service announced “Second Ounce Free” for bulk-mailed First Class letters. But guest columnist Robert W. Mitchell points out below that the pricing strategy is unlikely to be profitable for the Postal Service, is seemingly unfair to some mailers, and does not follow good pricing practices.
The average Jan. 22 increase in rates for all of First Class adheres to the inflation-based rate cap of just over 2%. That means the lower rates for presorted letters weighing between 1 and 2 ounces are being balanced out by higher-than-inflation increases for other types of First Class Mail.
Mitchell’s analysis makes the simplifying assumption that other bulk mailers are bearing the entire cost of Second Ounce Free. But it’s also possible that the high increases for parcels (10.9%), international (4.7%) and Forever Stamps (2.3%) are helping to bear the load.
