1. Mailing Services Price Change Effective April 17, 2011 January 2011 1 2011 Mailing Services Price Change GBPCC L & L Andrée Kater Manager, Business Mail Entry Alabama District U.S. Postal Service March 17, 2011

2. Mailing Services Price Change Effective April 17, 2011 January 2011 2 Agenda  Timeline  CPI cap  Changes by class of mail  First-Class Mail  Standard Mail  Periodicals  Package Services  Extra Services and Fees  Resources

3. Mailing Services Price Change Effective April 17, 2011 January 2011 PRC Determination Feb 16 34 days 3 Timeline PreparationRegulatory ReviewImplementation 45 days 49 days Price development Notify PRC Jan 13 April 17, 2011

4. Mailing Services Price Change Effective April 17, 2011 January 2011 4 The Price Cap  Based on Consumer Price Index  PRC formula a moving average of CPI data  Current calculation of cap is 1.741%

5. Mailing Services Price Change Effective April 17, 2011 January 2011 5 First-Class Mail Product% Change Single-piece Letters & Cards0.5 Flats5.3 Parcels3.8 Presort Letters & Cards1.8 International4.0  1.7% overall increase  44-cent stamp (no change)  New commemoratives issued as Forever Stamps  Nonmachinable surcharge (no change)  New! Parcels: retail/commercial price distinction

6. Mailing Services Price Change Effective April 17, 2011 January 2011 6 First-Class Mail Single-Piece  Letters and Postcards  Additional ounce increases by three cents to $0.20  Postcards increase by one cent to $0.29  Parcels  Same price for one to three ounce pieces  New! Retail and commercial base price categories  First-Class Mail International  Letters & postcards to Canada and Mexico – $0.80  Rest of the world – $0.98 (no change)

7. Mailing Services Price Change Effective April 17, 2011 January 2011 7 First-Class Mail Presort  Letters and Cards  Most prices increase 0.5 cent to 0.8 cent  2.5-cent price difference between 5D and 3D  No change for additional ounce  Parcels  Address cost issues for lightweight parcels  Same price for one to three ounce pieces  New! Commercial base price category  New! Commercial plus category for heavier parcels  Weight limit increased from 13 ounces to less than 16 ounces

8. Mailing Services Price Change Effective April 17, 2011 January 2011 8 Standard Mail Product% Change Letters1.8 Flats0.8 Carrier Route Letters, Flats, and Parcels1.4 High Density / Saturation Letters0.6 High Density / Saturation Flats and Parcels 0.4 Parcels (NFM’s / Parcels)11.3  1.7% overall increase

9. Mailing Services Price Change Effective April 17, 2011 January 2011 9 Standard Mail  Foster growth in advertising mail  Working with Catalogs and Saturation mailers  Encourage growth  Below average price increase for Standard Flats  New! Jan. 2, 2011: Expansion of Simplified Addressing  “Postal Customer”  For saturation flats and irregular parcels  Delivery to any address, including city delivery routes

10. Mailing Services Price Change Effective April 17, 2011 January 2011 10  1.7% overall increase  Low price cap constrains ability to cover costs  Encourage efficiency  Above average increase for Origin Pallets  Maintain 9.8-cent differential between 5D – CR Periodicals Product% Change Outside County1.8 Inside County1.1

11. Mailing Services Price Change Effective April 17, 2011 January 2011 11 Package Services Product% Change Single-piece Parcel Post1.8 BPM Flats0.7 BPM Parcels2.0 Media Mail (including Library Mail)2.0  1.7% overall increase  Lower price increase for BPM Flats  Only product covering costs

12. Mailing Services Price Change Effective April 17, 2011 January 2011 12 Extra Services and Fees Product% Change PO Boxes2.2 Certified Mail1.8 Return Receipt 0.7 Money Orders0.3 Fees 3.0 Other 1.7  1.7% overall increase

13. Mailing Services Price Change Effective April 17, 2011 January 2011 13 Resources  Online  Current prices ─ usps.com/prices  Postal Explorer ─ pe.usps.com  Current and new price files (downloadable)  Federal Register notices  Domestic Mail Manual & International Mail Manual  DMM Advisory ─ e-mail updates for customers  Subscribe: dmmadvisory@usps.com  P&C Weekly ─ e-mail updates for employees  Subscribe: pandcweekly@usps.com  MailPro ─ hardcopy magazine  Subscribe and view online: usps.com/mailpro

14. Mailing Services Price Change Effective April 17, 2011 January 2011 Q ????????????????????????????? U E THANK YOU! S T ??????????????? I O N S ??????