Intelligent Update. (IMb and IMpb)

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Everett Adams
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1 Intelligent Update (IMb and IMpb) Parcel Shippers Association GENERAL MEMBERSHIP AND BOARD OF DIRECTORS MEETING January 30, 2014 K&L Gates, 1601 K St. NW, Washington, DC Richard Porras Newgistics Paul Kovlakas Pitney Bowes

2 A Strategic Vision The USPS wants to be able to track every piece of mail and package it receives Optimize delivery network and resources Better able to compete for parcel business Measure & verify service delivery performance Enable dynamic routing and planning

3 A Tale of Two (or more ) Barcodes IMb Intelligent Mail Barcode IMpb - Intelligent Mail Package Barcode IMcb Intelligent Mail Container Barcodes

4 Full Service IMb & the PRC s CPI Ruling FS IMb as a requirement to qualify for Automation presort rates was included in the CPI Rate filing PRC rules that requiring FS IMb to qualify for automation rates is effectively a rate increase Rules that CPI increase and FS IMb mandate cannot be implemented coincidentally, as total increase would exceed CPI USPS delays the requirement that mailings be FS IMb to qualify for Automation rates until after 2014 However, Electronic Verification will be performed as part of Full Service Incentive Discount qualification edoc Verification Starts in January 2014 FS IMb Discount at risk beginning July 2014 (FCM $0.003, STD $0.001)

5 FS IMb Electronic Verification July 2014 Initial thresholds based on current performance To be revisited spring 2014 Error Type Threshold Performance will be assessed monthly Full-Service Incentive Discount will be at risk starting July 2014 Loss of discount for all pieces in excess of threshold for the given month Barcode Uniqueness 2% By/For - Invalid - Matching 5% - Mail Owner is an MSP Co-Palletization 5% Entry Facility 5% Mailer ID 2% Service Type ID 2%

IMpb Requirements 1. Unique IMpb Compliant barcode on every commercial parcel + 2. Shipping Services File version 1.6 or later ++ 3.

6 IMpb Requirements 1. Unique IMpb Compliant barcode on every commercial parcel + 2. Shipping Services File version 1.6 or later Correct delivery address or ZIP+4 in the SSF +++ Includes Permit, Metered, PC Postage and Precancelled Stamps $0.20 surcharge will apply for pieces that exceed thresholds in the 3 compliance categories (Competitive Services Priority Mail, Priority Mail Express, First Class Package Services, Parcel Select, Parcel Select Lightweight, Standard Post) + Except retail priced and retail entered parcels, Periodicals parcels, and Standard Mail Marketing samples with simplified address or DAL, Priority Mail letters/flats using stamps & Priority Mail Forever Prepaid Flat Rate parcels. ++ Prior to entry preferred +++ DPV required in January 2015

7 IMpb Requirements (continued) Surcharge applied on per mailing basis (non-evs mailers) or monthly based on monthly performance BPM Parcels and Priority Mail letters/flats can use IMb in lieu of IMpb along with Mail.dat/Mail.xml in lieu of SSF (no automatic insurance) Must obtain authorization from USPS MRS Labels must include an IMpb* Not required to submit SSF unless using PC Postage Required as of July 2014 BRM for Parcels will be eliminated in January 2015 Commercially entered PME must be compliant Except those entered as part of a retail transaction, metered pieces using label 11-B, those entered under a manifesting agreement (EMM) paid for with USPSCA ** * USPS provides a tool to assist in label creation ** evs will eventually be required for EMM

8 IMpb Timeline Introduced in a Final Rule September 2011 Required for Presort Rates and Destination Entered Parcels Required on Parcels using PC Postage Required on any Mail w/extra Services Implemented Jan 2012 with transition period to July 2012 Transition extended to Jan 2013, limited exceptions were allowed A second proposed rule was issued July 2013 Extend to all commercial parcels (with exceptions) Surcharge proposed in lieu of drop to retail 3 compliance categories with thresholds Second Final Rule issued December 2013 All commercial parcels (with exceptions) January 2014 Transitional Period Allow Legacy barcode through Jan 2015 Limited exceptions will be considered $0.20 surcharge in lieu of retail pricing July 2014 Market Dominant assessments deferred till at least July 2104 Thresholds will increase in July 2014 and again in January 2105

9 New Standards to Enhance Package Visibility IMpb 2.0 Per-piece fee will be charged for non-compliant pieces instead of losing Presort/Destination Entry pricing (for Competitive Products only) Category Jan 2014 Jul 2014 Jan 2015 Unique trackable barcode (legacy or IMpb) 98% 99% 99%* Destination Delivery Address/ZIP + 4 in file 93% 95% 98%** Shipping Services File v 1.6 or higher, including required data elements 90% 95% 97%*** *IMpb only by Jan 2015 **Must contain street address/11-digit DPV code by January 25, 2015 ***SSF v 1.6 or higher ONLY by January 25, 2015 Information provided by USPS

10 A Year s Progress with IMpb A Year s Progress with IMpb 100% Commercial Mail Trend 95.17% 90% 80% 70% 91.21% 84.19% 60% 50% 40% 30% 20% IMpb LEGACY BARCODE ALL PIECES WITH ZIP+4 AND/OR ADDRESS Compliant SHIPPING SERVICES FILE 10% 0% 4.83%

11 A Year s Progress with IMpb CATEGORY December 2012 December 2013 % Use of IMpb 52.98% 95.17% % Shipping Services File version 1.6 or higher 87.05% 91.21% % Address or ZIP + 4 in file 61.23% 84.19% % Use of Legacy barcode 47.02% 4.83% %

12 PTR Software Enhancements PTR Release 1/12 TEM 1.7 Deployment TEM available this Sunday, January 12, 2014 (Please note that this deployment is only for TEM and the Production application will not be affected) 9:00 9:30 PM -Take down Application Processes 9:30 10:00 PM Java, Informatica and Database Deployment 10:00 10:30 PM Bring Application Processes back up 10:30 PM 12:00 AM - Technical/Functional Verification Production on Sunday, January 26, 2014 Sunday 7:00 PM Monday 4:00 AM CT Deployment 7:00 7:30 PM -Take down Application Processes (Ingest, Stage to Final, Extracts) 7:30 9:30 PM Back-end Infrastructure Change 9:30 10:00 PM Bring Application Processes back up 10:00 PM 4:00 AM - Technical / Functional Verification

13 PTR Releases PTR Software Enhancements January Release 1.7 FEATURES -- Include changes to support IMpb requirements Manifest edits are the same for evs and non-evs file types Priority Mail Express 10:30 am service Indicators for Live Animals, Hazardous Materials and Cremated Remains Collect on Delivery (COD) Enhancements IMpb Lite IMpb for small volume meter customers Compliance measured for key requirements Tracking barcode Shipping Services File v 1.6 or higher Destination Delivery address/11-digit DPV/ZIP+4 Code

14 Release 1.7 FEATURES (continued) PTR Releases New Additional Service Codes (ASCs) for Identification of Hazardous Materials and Live Animals Included in Federal Register rule ( ) Customer must include ASC in D1 record, in the last (5 th ) Extra Service Code position identifying the presence of either hazardous material or live animals in shipment Strongly recommended that cremated remains be similarly identified but will not be required Label 139 available

15 Release 1.7 FEATURES (continued) PTR Releases Merchandise Returns Service (MRS) and other returns containing hazardous materials will require a unique IMpb Specific MRS 3-digit Service Type Code identifies mail class and hazardous material content Extra and Additional Service Type Codes appended STC DESCRIPTION BANNER TEXT EXTRA/ADDITION AL SERVICE CODES Priority Mail Merchandise Return: USPS Tracking, Hazardous Material USPS TRACKING # Priority Mail Merchandise Return: Signature Confirmation, Hazardous Material USPS Signature Tracking Parcel Select Merchandise Return: Signature Confirmation, Hazardous Material USPS Signature Tracking Parcel Select Merchandise Return: USPS Tracking and Hazardous Material USPS TRACKING # Standard Post Merchandise Return: Signature Confirmation, Hazardous Material USPS Signature Tracking Standard Post Merchandise Return: USPS Tracking and Hazardous Material USPS TRACKING #

16 Release 1.7 FEATURES (continued) HazMat Placement in Shipping Services Files Shipping Services Version USPS Publication 199 Published January 24, 2014 New Fields in Detail Record 1 Fifth Extra Service Code Record Position Fifth Extra Service Fee Record Position* Shipping Services File v Shipping Services File v Shipping Services File v * Note: there is no additional fee for HazMat packages.

17 Intelligent Update (IMb and IMpb) Questions?

Intelligent Mail Package Barcode (IMpb ) and Electronic Documentation Requirements Overview

Intelligent Mail Package Barcode (IMpb ) and Electronic Documentation Requirements Overview Juliaann Hess Manager Shipping Information Systems July 8, 2014 To listen to a recording of this presentation