Small businesses across the United States are bracing themselves for the financial impact of yet another increase in stamp prices. From July 9, 2023, the cost of a first-class stamp will rise from 63 cents to 66 cents, marking the second price hike this year alone. Stamp price increased from 60 cents to 63 cents in January 2023.
The reason given by the agency
The US Postal Service has cited inflation and a defective pricing model as reasons for the increase, as it struggles to manage an annual budget loss of $10 billion and more than $188 billion in unfunded liabilities and debt.
The plan to increase the price of stamps has been given the green light by the Postal Service’s decision-makers. However, it still needs to be approved by the Postal Regulatory Commission before it can officially happen. If it gets the go-ahead, people will have to start paying more for stamps on July 9, 2023.
“As operating expenses fueled by inflation continue to rise and the effects of a previously defective pricing model are still being felt, these price adjustments are needed to provide the Postal Service with much-needed revenue,”the agency said in a statement
How much is the price of postage stamps increasing?
From 9th July 2023, the price of a first-class stamp will go up from 63 cents to 66 cents, which is an increase of 4.6%. Additionally, other types of mail may also become more expensive, such as a 1-ounce metered letter which is proposed to cost 63 cents instead of 60 cents. The Post Office is also considering raising fees for services like certified mail, money orders, and post office boxes.
Will shipping rates go up too?
Although the Post Office raised the prices for sending packages through First Class Mail, Priority Mail Express and Priority Mail in January, there has been no news of any further price changes as of now.
How to Save Money for Stamps after the hike
Purchase Forever Stamps in Bulk: Stock up on Forever stamps before the price increase takes effect from 9th July 2023. Forever stamps are always valid, regardless of when they were purchased or the price paid. By purchasing Forever stamps now, small businesses can save money on future postage costs.
Impact on small businesses
Small businesses are among those that will be hit hard by the price increase. According to a survey conducted by the National Small Business Association, shipping and postage costs are a significant expense for many small businesses. The survey found that 72% of small businesses ship packages, with an average monthly shipping cost of $150. Additionally, 41% of small businesses use direct mail as a marketing tool, with an average monthly cost of $120.
Financial burden on small businesses
The increase in postal rates will result in a significant financial burden for small businesses. For those that rely heavily on direct mail or shipping, the cost increase could be substantial. With small profit margins and limited resources, these businesses will need to find ways to mitigate the additional expense.
How to Mitigate the Total Costs?
There are several steps small businesses can take to mitigate the impact of the postal rate hike:
Negotiate Shipping Rates: Small businesses can negotiate shipping rates with their shipping carriers. Many carriers offer discounts based on volume or frequency of shipments.
Use Alternative Shipping Methods: Small businesses can consider using alternative shipping methods, such as UPS or FedEx. While these carriers may be more expensive for some shipments, they may be more cost-effective for others.
The postal rate hike will undoubtedly have an impact on small businesses. However, by taking proactive steps to mitigate the additional expense, small businesses can minimize the impact on their bottom line. From purchasing Forever stamps to negotiating shipping rates, there are several options available to help small businesses manage their shipping and postage costs.
Hello, I’m Kevin, a passionate philatelist from Brooklyn, NY, with years of experience in collecting and studying stamps. Through my blog, I aim to share my knowledge and insights on all things related to stamps, including where to buy them and their current market value. As a trained researcher, I pride myself on providing accurate and trustworthy information to my readers. Feel free to reach out to me through the contact form with any questions or suggestions. Happy stamping!