Below is a summary of the points discussed at the hearing of January 28, 2009

Senator Thomas Carper:

• The Postal Service is under stress
• The Postal Service has laid out a plan to cut costs.
• Despite efforts to cover costs, the USPS may be hitting its borrowing limit to cover costs.
• The mailing community said that more postal rate increases could lead to further mail volume losses.
• USPS losing ground to electronic communication.
• Still unknown exactly what is at the root cause of the Postal Service’s fiscal stress.
• The USPS has approached Congress with a proposal for PAEA funding relief. Concerns have been raised about this proposal.
• This would reverse a “deal” made in PAEA regarding the funding of liabilities and determining obligations for former military personnel.
• Enactment of some version of the USPS’ may be vital.
• GAO has said that a temporary grant of relief would be appropriate.
• There are some questions as to what kind of business model can work and generate more revenue.

Senator Daniel Akaka:

• Over the past two years, the USPS has undergone transformation, primarily because of PAEA.
• More than a band-aid is needed. USPS could use its exigency options. This would drive revenue down even further.
• USPS needs to find new business opportunities and expand its current relationships.
• Needs to have caution with NSAs to make sure they pay their own way.

Senator Susan Collins:

• Enactment of PAEA was an arduous process.
• We need to continue the nation’s universal postal services. Mail is still a key part of the nation’s economic infrastructure.
• The current recession has placed the Postal Service back on the congressional agenda.
• The question has been raised as to whether the Postal Service is trying to use this crisis as a way of pulling away from PAEA.
• The PAEA retiree payments were a key part of the negotiating to make PAEA possible.
• A rwo-year reprieve is doable. Beyond two years make take too much pressure off the USPS to respond to its other challenges.
• GAO has been disappointed with the USPS’ responses. GAO expressed frustration with the USPS’ lack of transparency.
• Very disappointed that the proposed solution is the elimination of the six-day a week delivery requirement. Service cutbacks also can impact mail volume adversely.
• Already received many complaints from publishers in Maine. Service has been compromised.
• I don’t know how you can ask for relief while proposing cutbacks in service that could precipitate further losses.
• I’m very concerned about the lack of the Postal Service’s financial transparency. You’re coming to Congress for relief with the needed transparency. This is unacceptable.

Senator Tom Coburn:

• No measure of fiscal relief will be enough to ensure the USPS’ viability.
• Changes are needed to flexibly respond to its challenges.
• You have a failed business model. Until you answer what your new business model should be, relief shouldn’t be given.
• I think electronic diversion is going to take away 90% of your First-Class Mail. This mail volume isn’t coming back.
• Tell us what Congress needs to do to help you develop a new business model.
• You’re asking us to give up $5 billion without giving us a plan that will allow us to see you’ll have continued viability.

Postmaster General Jack Potter:

• The Postal Service is in acute financial crisis.
• The cause of the financial situation we are facing is two-fold.
• A revolution in the way people communicate has structurally changed the way America uses the mail. For the last decade, we have experienced a steady erosion of First-Class Mail – one of our highest-margin products – as billings, payments, statements, and personal and business correspondence continue to shift from the mail to electronic communications.
• Extraordinary, upward cost pressures led by record-high fuel prices for our more than 220,000 motor vehicles and 37,000 facilities; contractual cost-of-living allowances for our almost 600,000 bargaining-unit employees, reflecting a sharp rise in consumer prices; and a congressionally mandated $5.4 billion annual funding payment for the Postal Service’s share of retiree health benefits.
• All of these factors contributed to a greater-than-expected net loss of $2.8 billion last year.
• Steps have been taken to reduce postal costs. Among the changes is a recently imposed freeze on all USPS officer and executive pay salaries at the 2008 levels. Steps also have been taken to reduce postal management expenses at national and area levels.
• The problems we are facing are intensifying.
• An exigent price increase would be counterproductive, particularly in an environment where mailing activity has already severely contracted.
• Revenue growth that is based on business growth – not simply price increases – is also a key element that is necessary for our long-term viability.
• We believe there is an urgent need to balance current responsibilities against future responsibilities. 
• It is possible that the cost of six-day delivery may simply prove to be unaffordable. If that should occur, it could become necessary to temporarily reduce mail delivery to only five days a week. We would do this by suspending delivery on the lightest volume days. Toward this end, I reluctantly request that Congress remove the annual appropriation bill rider, first added in 1983, that requires the Postal Service to deliver mail six days each week.
• We are asking for a legislative change to provide relief from the crippling cost burden imposed by the law’s requirement that we prefund the employer premium for the health benefits of future retirees while continuing to pay health care premiums for our current retirees. This, in no way, removes our obligation to satisfy this basic benefit funding need – nor should it. What it does do, by transferring the current premium payments to the fund, is improve our financial position and cash flow significantly. This will free up a tremendous portion of operating revenue to offset our current operating expenses.
• The USPS will lose 20 billion pieces out of its current 212 billion. Will drop to 189 billion pieces.
• In the first quarter of this fiscal year First-Class Mail has dropped 6%. Advertising mail has dropped 11%.
• Reduction of days of delivery has been discussed with mailers. They’d be willing to make adjustments to keep rates within inflation.
• The USPS is not proposing a permanent change in days of delivery, but only the flexibility to adjust days to actual mail volume.
• Over the long term, service reductions may be a reality.
• No one anticipated the size of the present precipitous volume decline.
• What’s more detrimental? Raising rates above inflation? Lower service levels permanently? Or more flexible responses in service to actual mail volume.
• We need Congress’ support for facility consolidations and infrastructure adjustments. Stop the NIMBY.
• Our first priority is to reduce our use of manpower when its required.

Postal Regulatory Commission Chairman Dan Blair:

• The USPS is facing troubling financial difficulties.
• The current economic downturn comes amidst electronic diversion. All mail volumes are declining.
• Given the choices, a short-term relief from PAEA payment schedules may be the most viable immediate alternative.
• The USPS should present Congress and the PRC a comprehensive long-term financial plan.
• More, not less, transparency is necessary.
• The Commission found that reducing days of delivery can be a double-edged sword.
• The PRC needs a clearer picture

Phillip Herr, Government Accountability Office:

• The Postal Service has not offset all of its costs with current measures.
• Mail volume will continue to decline.
• Some short-term relief may be in order. Two years worth of relief is preferable.
• The USPS needs to modify work rules to reduce costs.
• The USPS needs to take urgent action beyond its current efforts.
• It needs to reduce its excess mail processing capacity. Only limited action has been taken to date.
• Retail services can also be changed.
• A broad integrated plan would make for better policy.
• Need to explore percentage the USPS pays for health care benefits.

by Bryan Yurcan, DM News.
While many companies consider e-mail or digital marketing as a cheaper way to reach consumers, experts say they shouldn’t eschew traditional direct marketing at its expense, because smart companies who continue a dialogue with their customers through a recession – using the tactile, personal direct mail channel — usually come out the better for it.   That’s because smart companies continue a dialogue with their customers through a recession, and usually come out the better for it, some experts say.The following are four ways experts suggest you tackle the tough economy using direct mail:
Keep communicating
Businesses in all sectors should communicate with customers through direct mail during these uncertain economic times, says Katie Yeakle, co-founder and executive director of American Writers & Artists Inc. “The biggest piece of advice I can give any business is to keep sending direct mail,” she says. “A lot of people [have the] instinct is to pull back, but I truly believe that the companies that are succeeding are the ones that have more and better copy out there.” She adds that many consumers are looking to be reassured and businesses — such as financial services companies, for example — should continue to communicate with them.
Invest in creative
Marketing copy is the one thing you should never cut back on, Yeakle says. “The need for good creative in direct mail pieces is more important now than ever,” she says. “You really need to stand out.” Yeakle says smart companies will always be looking to recruit talented copywriters, as investing in quality creative will yield positive results. Good copywriters are “the one thing you should never cut back on,” he advises.
Make sure to integrate
Direct mail provides a means of a measurable, quantifiable marketing during this slow economy, says Steven Gray, COO of Money Mailer. But they work best when integrated with other channels. “There is a need to integrate online and offline channels and improve how we target with the channels available to us,” Gray says. “Direct mail works best when combined with other channels.”
Don’t forget to self-edit
April Williams of North Star Marketing believes that concise and straightforward direct mail pieces will be the most successful with consumers. “We owe it to the people we’re marketing to that we will understand and respect their time,” she says. “We don’t have a lot of time in this world, we’re a multitasking society. If I can get a minute of their time, that’s great.” For example, Williams says she is “not a fan of large newsletters” from companies, preferring pieces that can be read in a timely fashion. “It’s a time starved world, and marketers should be able to cut through the clutter,” she explains.  Most importantly, according to Williams, companies should not cut back on their overall marketing messages. “Don’t stop communicating with your customers,” she says. “Companies that come through recessions, studies show, are the ones that market through a recession.”

The EMA Foundation for Paper-Based Communications’ Institute for Postal Studies (IPS) recently released the “2008 Economic Jobs Study for the Mailing Industry” This is an update to its 2003 study. The study provides a detailed analysis of mailing industry jobs by congressional district for all 50 states in the United States. The study finds that there are 8.4 million jobs and over $1 trillion in revenue attributed to the mailing industry. For a copy of the final report, click here A breakdown by state can be viewed here and a breakdown by congressional district within each state can be viewed here.

Troy MI— The Wolf Envelope Company proudly celebrates 85 years as a full service custom envelope manufacturer. The company originated in Cleveland, OH in 1899. In 1923 the Wolf organization opened an operation in Detroit, MI to better serve the growing automotive industry. At that time, Wolf was a key automotive corporate supplier of envelopes, stationery and parts packaging.

Today Wolf’s corporate headquarters is located in Troy, MI. Wolf’s main manufacturing facility is located in Angola, IN, with an additional manufacturing location being added in Hattiesburg, MS in 2002.

Wolf Envelope actively supports “green” initiatives that are designed and focused on protecting the environment. Wolf’s successful completion of a triple chain of custody certification promotes stewardship and responsible forest management world wide.

Wolf’s primary service profile is to serve those Midwest corporations that require large volumes of envelopes and distribution to a variety of locations throughout the Midwest and North America. As a part of Wolf’s service profile, Wolf Direct is an online ordering and management system with easy, 24 hour access for order processing and inventory management.

The Wolf Envelope Company is pleased to celebrate it’s 85th anniversary with a “Plant a Tree” campaign. In cooperation with the Arbor Day Foundation we are offering a 6 month membership along with 10 tree saplings to each customer that permits the “Please Recycle” logo to be printed on their envelopes.
The purpose of this campaign is to create the awareness of the recyclability of the materials used and the environmentally friendly product.

The campaign will run through April 30, 2008 with all new orders placed by that date. Details are available by contacting your account manager, or call 800-466-9653 ext. 1116. You may also contact us from our web site by clicking on this link.

Angola, Ind. - Wolf Envelope announced today a multi-million dollar investment to increase the production capacity of its manufacturing facility, creating 26 new jobs.
“Wolf Envelope’s continued growth is a great sign that the business environment we have created is supportive of growing companies,” said Nathan Feltman, Indiana Secretary of Commerce and chief executive officer of the Indiana Economic Development Corporation.
The Angola facility is the primary manufacturing facility with the corporate headquarters based in Troy, Michigan and a satellite operation in Hattiesburg, Mississippi. The Angola facility employs 82 associates and produces more than 1 billion envelopes every year. The company plans to begin hiring new associates later this year.
“We are excited to continue our growth in Indiana with the support of the state and local community. This partnership will allow us to break into new markets, and offer more opportunities to the work force.” said Larry Eiden, plant manager of Wolf Envelope’s Angola facility.
“This is a real shot in the arm for our community and our economy,” said Angola Mayor Richard Hickman. “We welcome Wolf’s continued commitment to Angola and our workforce.”

About Wolf Envelope
Since its inception in 1923, Wolf Envelope has led the industry in innovations, many of which are still used in manufacturing facilities nationwide. Wolf Envelope specializes in large volume orders of custom sizes and windows for commercial, booklet and catalog style envelopes. Wolf has a strong expertise supporting large volume users with multiple item shipments and contract management requirements. The company operates two manufacturing facilities totaling 100,000 square feet and staffs its operations with a three-shift production operation on its high-speed web equipment. For more information about Wolf, visit www.wolfenvelope.com.

About IEDC
The Indiana Economic Development Corporation is the state’s premier entity charged with economic development. The IEDC has a 12-member board chaired by Governor Mitch Daniels. Indiana Secretary of Commerce Nathan Feltman is also chief executive officer of the IEDC. For more information about IEDC, visit www.iedc.IN.gov.-30-
Media Contact:
Mitch Frazier (IEDC) – 317.232.8873 or MFrazier@iedc.in.gov

By Alex Fu, Pitney Bowes

The adoption of electronic bills, statements and payments has grown significantly in recent years, as has the explosive growth in Internet penetration, the evolving consumer preferences for new media, and a determined push by financial institutions to convert users from paper to electronic. Most forecasters, observers, and the general press typically characterize these electronic options as severely and negatively affecting the volume of bills, statements and payments that are mailed. Is there reliable industry data that can be used to check these assertions? Are the quantifiable trends universal or do they vary by region? Exactly how have electronic alternatives impacted user preferences so far and how will they continue to impact mail volumes in the foreseeable future?

To read more on this research paper from Pitney Bowes, click here

When it comes to envelopes and technology, most past innovations were limited to the manufacturing process. These advancements helped create a plentiful and affordable supply of a trusted product that millions of Americans use every day, but they did not change the basic structure and power of the envelope. New technologies are emerging, though, that could transform envelopes as we know them.

Today, many people continue to think of paper-based communication and electronic communication as separate. The truth is that, increasingly, direct mailers and others are combining these two channels for maximum impact. A well-known example is Netflix, the movie-rental business. Customers pick their movies online, and the movies are sent through the mail in an envelope that serves as both the delivery and return mechanism. As technology advances, more opportunities will emerge to bridge the print and online worlds, facilitating more strategic marketing campaigns.

Advanced printing technologies. As the industry moves toward a digitally-integrated process, it is becoming easier to replicate colors. Some printers are now able to turn the entire envelope into a canvas, allowing direct marketers to use more space for their messages. The envelope becomes a piece of the overall campaign, not just a delivery mechanism for what’s inside.

According to the Intelligent Document Task Force, created by the Envelope Manufacturers Association Foundation and the U.S. Postal Service, high-speed inkjet technology could allow for more information to be encoded onto mail pieces. This may allow envelopes to one day become an extension of a Web site, communicating information through a bar code, read by a bar code reader for the home. The bar code could direct a consumer to a Web site, making it easier to shop online or return merchandise.

New intelligent systems. Recently, the USPS expanded its Intelligent Mail bar code system to include flat mail. The system provides the ability to use a single bar code to store more information on individual pieces of mail. This allows for better tracking of mail pieces, which facilitates better sequencing of marketing efforts. For example, if a marketer knows consumers in a particular city or region will receive a direct marketing piece on a certain day, it could buy advertising time in the local television market timed to correspond to the “mail moment” closely.

An exciting area of research and development is intelligent stamps. There are many potential uses for stamps featuring wireless technology. Perhaps one day a stamp will communicate with a cell phone and call up a Web site about a product or service or issue a missing child alert. This technology could also be used on the envelope itself.

Not just a cover anymore. Academics and industry researchers are working on a number of next-generation technologies that will make the envelope even more versatile and powerful. These include:

Electronic ink can turn envelopes into tiny billboards. Imagine receiving an envelope that shows you an image of a product and then switches to describe its features and benefits.

Memory spots can store information on a document or envelope. With this technology, a photograph could interface with a computer to deliver an audio message from the person in the picture. Or, a company could attach a memory spot to an executive summary, so they need to mail only a small portion of a report while the remainder could be transferred to a PC.

Radio frequency identification chips embedded in an envelope could offer a better tracking system or more secure transaction, ensuring that the recipient received the product, whether it is medication or a new credit card.

The face of mail is going to change dramatically as these technologies are refined and deployed. The envelope is positioned to go high-tech, offering the potential for direct marketing to become more personalized, secure and effective.

Maynard H. Benjamin is president/CEO of the Envelope Manufacturers Association, Alexandria, VA.

According to a survey done on behalf of Pitney Bowes by International Communications Research and released on June 11th, even in the age of technology, consumers prefer traditional mail as the main means of communication over other alternatives such as e-mail. This includes bank statements, financial reports as well as service and product offerings.
They found that the majority of consumers (73 percent) prefer mail for receiving new product announcements or offers from companies they do business with, as compared to 18 percent for e-mail. Mail was also preferred by 70 percent of respondents for receiving unsolicited information on products and services from companies with which they are not currently doing business.
For confidential communications such as bills, bank statements and financial reports, respondents overwhelmingly preferred mail (86 percent) as their channel of choice, as compared with 10 percent for e-mail
The survey also found that consumers are less likely to discard unopened mail (31 percent) – including new product brochures, catalogs or other advertising materials – than they are to discard unsolicited e-mails about new products (53.2 percent).
The survey also probed consumers on specific advantages they see in mail versus unsolicited e-mail and telephone calls.
Compared with other communications channels, including e-mail and telephone, survey respondents found mail to be: less intrusive — doesn’t interrupt other activities (45.3 percent); more convenient — can be saved and considered at leisure (40.2 percent); less high-pressured — lets you consider your decision (30.2 percent); more descriptive — lets you picture the offer (22.7 percent); and more persuasive — encourages you to respond (12 percent).