A Healthy Weight Gain for Catalogers

On January 22, 2017, the United States Postal Service (USPS) increased the maximum weight limitation for piece rate catalogs from 3.3 to 4.0 ounces. This weight increase is one of the most significant benefits to catalogers I have seen in many years. It is a true gift from the USPS. Why is this such a big deal? In 2016, the cut-off depending on paper weight and trim size was approximately 60 pages to come in weighing 3.3 ounces or less.

This year, an 80-page catalog will still qualify at the postal piece rate if it weights 4.0 ounces or less. That means a cataloger can circulate approximately 20 more pages without incurring any additional postage cost. Postage cost is a constant up to approximately 80 pages. The additional incremental cost is for paper and print manufacturing.

For example, last year it would have cost approximately $235,600 to mail an 80-page catalog. The in-the-mail cost this year for that same catalog is $9,100 less or $226,500. This difference is all reduced postage cost, i.e., more pages and square inches of selling space and less cost equal a win-win!  The economics of adding pages is extremely favorable. Keep in mind that postage is 50% to 60% of the total cost to print and mail a catalog. Therefore, being able to circulate more pages without increasing half or more of your costs is a big advantage. Adding pages without increasing your postage costs will leverage your direct selling expenses. The incremental cost of adding more pages is minimal considering the increased revenue and ROI.

What can you expect in return for adding pages to your catalog? Revenue should increase by one-half the percent increase in page count. Therefore, increasing from 60 to 80 pages will yield 33% more selling space. Gross revenue should increase by approximately half this amount or by 16%.

Increasing page count is a good investment and an excellent way to grow your business. If your catalog includes 60 pages (or less) currently, I am not necessarily recommending you increase to 80 pages all at once. Rather, increase in 8-page increments with a goal to get to 80 pages over time. Always best to take a more conservative approach. I believe it is one of the most progressive and significant changes coming from the USPS in years. It is truly a healthy weight gain for catalogers.