Like bees among the wild flowers, from September 7-10 Boston Massachusetts was swarming with shipping/mailing/database management and printing industry professionals, in town to attend NPF-Boston '97.

The Environment...

With so many recent and upcoming USPS changes to stay on top of (including the next few waves of Classification Reform), professionals came from all corners of the United States, as well as several foreign countries.

The show was very interesting and timely because many new mailing software products, pieces of equipment and machines have recently been launched and many more are in the final stages of development and testing, awaiting near future marketing & distribution.

Another item which was very quickly noticed and extremely interesting was to see many of the same faces of exhibitors whom I am familiar with seeing at the most common shows, year after year, manning booths with a "new look" or even a totally different company name.

The mailing industry as we know it is changing very rapidly, including the people within it. As is common with several other industries, merging, forming partnerships and overall takeovers and acquisitions have become much more visible and apparent in the industry.

Many of the people whom I have had the pleasure of working with, learning from and interviewing over the years were either flying the flag of a new company or were not present at all (often replaced by a new, previously unknown representative).

While some of this activity is in fact caused by the introduction and further development of new electronic and alternate communications, most of the reasoning for the changing of the guards seems to have been caused by typical corporate decisions, the addition of more people through merges, etc.

And then of course there were those few individuals seen at each and every show which for one reason or another can't seem to find a long-term home with any one particular company. Yet possibly drawn in almost as prisoners by the exciting technology and fast pace, they fight to remain active in the mailing & shipping industry. More than once the term was heard between attendees and exhibitors "so, who are you with now"? As the rules, rates and technology rapidly change, so will many of the players over the next few years. Computers and technology in the mailing & shipping industry are quickly replacing yesterday's "Superstars", "movers-and-shakers" of the industry with tomorrow's.

On the USPS side...

The USPS proudly displayed two new additions to their fleet of automation. Both of these new additions will greatly help the USPS to gain even more market share of the world's package and parcel distribution business which they have more aggressively and steadily been peeling away from UPS (United Parcel Service) and FedEx (formerly Federal Express) over the past year or so.

Before we review the two new USPS items, first, let's quickly refresh our memories... Our research as Independent Mailing & Shipping Consultants and constant participation and exposure to other professionals within the industry has led us to believe that there are only two primary reasons why companies ever reach out to UPS or FedEx for their package deliveries and expedited services rather than giving the business to the USPS. They are; (A) the ability to track packages, and (B) lower service charge or delivery costs per pound/item.

With that in mind, we should basically think it through and understand that for the past few years UPS and FedEx have both been utilizing automated systems (systems which allow scanning, tracking and delivery confirmation through the use of barcodes, computers, scanning equipment and vehicle tracking satellites). We all know that utilizing automated transportation and package distribution systems usually costs less, saves time and is much more accurate than using slower, more tedious, less accountable manual methods.

We can also appreciate that any vendors pricing must be calculated by taking the operating costs, adding the desired profit (normally gauged with great consideration of competitors pricing & services), and then adding a safety buffer for unexpected occurrences, market fluctuation, etc.

Highly automated operations should routinely be able to run at a much lower cost, which should allow the end price of such services to be offered at prices much lower than those companies offering similar (yet manual) services (in this case, package & parcel delivery services). While enabling lower prices, the same automation happens to provide the package tracking and delivery confirmation capabilities and standards desired by the overall majority of the market.

So... Wouldn't it make good sense that if the USPS were to operate a more advanced, more automated system that they too would be able to offer tracing, tracking, delivery confirmation and lower prices?

Well... Good news is here! "Live", at a booth at NPF-Boston, the USPS proudly displayed one of the new hand-held scanners which are now being used in 10 test markets, which are enabling preliminary tracking-tracing and delivery confirmation of USPS Priority Mail! After several delays and set-backs, the funding for Priority Mail's Automated Systems has been Officially approved and samples of the tracking hardware, software and barcoded stickers were on display for all to see, feel & touch.

Priority Mail is officially and quickly moving up into the real and competitive world of accountable mail and package distribution & delivery. Working hand-in-hand with the scanners is at least one military satellite and the "Enhanced Street Performance" delivery tracking system which is beginning to monitor and keep track of transmitter-equipped USPS trucks. Similar to what the competitors have been doing, the USPS system enables each truck on the system to be monitored. Each route can then be quickly analyzed and readjusted in order to maintain maximum speed and efficiency while taking factors such as changing route sizes, traffic and other key items into consideration.

Although only in 10 test markets so far, now that the funding is approved the USPS plans to have all appropriate trucks, letter carriers and USPS facilities tooled-up and automated by sometime in 1999. While 1999 can initially seem a bit far away, those of us deeply involved in several "Year 2000" projects will surely agree that 1999 is right around the corner as business and imperative deadlines go. It will be here before we know it!

After tackling the loss-of-tracking issue (which through experience I personally feel was the biggest reason why people chose the competition, wining over price by only the slimmest of margins), the USPS quickly realized that they had better be prepared to handle the additional volume and types of packages which will come their way once they have automated and marketed their technological and more competitive improvements.

For starters, it was important for the USPS to review the types of items which were most difficult to handle & process, as well as taking into consideration the physical characteristics of what types of packages USPS customers were routinely shipping by other carriers (competitors) UPS, FedEx, etc.

Careful consideration proved that oversize objects in the form of "Flats" (which contain many of the heavier, more bulky catalogs and publications) undoubtedly qualified as a very attractive element of mail to be catered to by the new USPS equipment arena and marketing tactics.

This brings us to the next "new toy" being displayed at the show, the FSM-1000 Flat Sorting Machine. The new FSM-1000 boasts a whopping maximum item weight capacity of 6 pounds! This is 5 times greater than the maximum item weight capacity of it's older predeceasing machines which could only handle items up to 1 pound. The widespread implementation of the new FSM-1000s will enable the USPS to process millions of pieces each year in an automated environment which used to have to be processed by manual or semi-automated means.

While the FSM-1000s will in fact handle the larger, heavier flats, they will also be used to process lighter, more common flats with better speed and through-put capabilities. They will run with less time consuming jams to clear and better reliability than was available in the past with the older machines.

As with almost any piece of Postal sorting equipment, Postnet Barcode reading capabilities as well as Tracking-Tracing barcode reading capabilities and special barcoding applications will likely be installed, customized and used on the FSM-1000s as needed.

While the scanners, satellites, computers, programs and FSM-1000s and various mechanical items are being put into place, Postmaster General Marvin Runyon has his work clearly cut out for him. He must keep pushing to accomplish the much harder, yet highly essential task needed for the overall plan of stealing substantial amounts of business from the competition to work;

The USPS must gain in-house control and the ability to more competitively lower rates for packages and parcels!

During his term as Postmaster General, we have all seen many improvements in the USPS and I sincerely feel that Mr. Runyon is doing a very good job. More impressively, he has been doing so when all along he has somewhat had his hands tied by the current rate making and approval processes. As I have mentioned before in other articles, one of the best analogies of the dilemma that the USPS is faced with is that "It takes less time to conceive and have a baby, than it does to lower postal rates:, as said by Mr. Runyon in several speeches. With all of the parties involved and all of the red-tape (which competitors don't have), it usually takes over 9 months to have rates changed (raised or lowered) by the United States Postal Service. Other (private) companies can usually change their rates after having a few meetings and running a few ads.

Sometimes the same rules, restrictions and standards which were initially put into force to protect us, end up becoming our worst enemy and barrier when it comes time to adapt new rules or implement new rates needed to stay competitive and realistic as times change.

While it would make sense that having the same types of equipment, automation, scanning and tracking/tracing capabilities as the competition would enable the USPS to be able to operate at similar or lower costs, the actual rates offered to the consumer will most likely still be a major factor in winning the war. There has never been a better time or foundation laid for the USPS to make their move. Many of our clients have in fact expressed a major breach or lack of trust in UPS since getting badly hurt when the UPS strike took place, swearing never to rely on UPS like they used to. However, many will eventually go back to UPS (if they haven't already) unless the USPS (or another carrier) offers similar services at similar prices.

Mr. Runyon, I'm sure that we all wish you luck in being able to roll out similar (or lower) rates, and the volume of material that goes through the new USPS systems will be a clear reflection of how the rates stack up. Many companies will even be willing to pay a bit more than the competition charges, providing that there is added confidence, tighter security or other value-added benefits associated with the higher costs.

Surely the road to rolling out lower rates will be a challenging one. While the USPS is currently fighting for more in-house control and the ability to not have to go through so many third parties (rate case committees, unions, etc.), the competition is working just as aggressively, trying to beat down the many barriers they must deal with such as the "Private Express Statutes" and the fact that the USPS already delivers everywhere (including the ability to deliver to PO Boxes), etc.

On the vendor side........

The NPF-Boston '97 exhibit floor was packed with a wide array of vendors common to mailing shows each year. Manufacturers, distributors and technicians alike showed off their latest and greatest tricks and solutions. Sorting machines sorted, folders folded and computer drives purred almost musically as demonstrations took place for all to enjoy. Apparent was the race to develop and launch products and goodies to enable the assertive mail center manager to keep abreast of modern technology and maintain leading edge facilities and systems.

There was one very obvious newcomer amongst the many, many rows of exhibitors, the booth for Post-express( and Post-Expo '97( Conference & Exhibition. Post-express (The Bulletin For The World's Postal Business) was handing out free copies of their somewhat new, premium international publication which covers key Postal issues and topics from all around the world. For professionals concerned with keeping up with the world's global distribution business and having to maintain control of their products and mailings sent afar, Post-express now fills a badly needed void.

No other mailing industry publication covers International topics in such great depth and at such a regular basis. (Usually running an average of 10-12 pages each issue, the biweekly publication's annual subscriptions are offered at a very reasonable rate of $360 US.)

Post-Expo '97 was the big Postal Conference (just held Oct. 6-8) in Hamburg, Germany where only the largest, most serious, technologically advanced and customer-conscious Postal Services and Postal-Related Companies, Manufacturers and Suppliers from around the world gathered to learn and show off their newest technologies and solutions. Primary topics included (super high-volume) "Mail Processing", "Customer Services", "Fleet Management & Distribution" and "Integrating Electronic Services into the Core Postal Business". Post-Expo's attendance at NPF-Boston aided to make Post-Expo '97 even a better show than it would have been, by enabling some last-minute exhibitors and attendees previously unaware of Post-Expo '97 to still attend the Hamburg event.

Although the USPS' internal rule of never exhibiting at an annual event in its first year prevented the USPS from exhibiting at Post-Expo '97, many of the USPS representatives whom I interviewed strongly wished that the USPS had exhibited and hope to see us stand our ground at Post-Expo '98 in a big way.

The next National Postal Forum is scheduled for March 8-11, 1998 at the Las Vegas Hilton. By then, many new and exciting USPS developments and services will be made available to mailers of all sizes. Be sure to plan accordingly and mark your calendar today. With so many proposed plans for USPS automation, ever increasing competition and the next few waves of USPS Classification Reform waiting in the wings, NPF-Las Vegas '98 will surely be a show not-to-be-missed.

"Cheers" to Boston, after a show well done!
Scott DeMayo, CMDSM, MPQCS President DeMayo Mail Management Consultants