Stamp Prices Increase January 7, 2001

Posted by accountingweb on Dec 6 2000 97 printer friendly

It's going to cost more to mail a letter as of January 7. How does this translate into bottom-line revenue for the Postal Service?

It's official: according to the U.S. Postal Service, the cost of a first-class, U.S. postage stamp will increase to 34 cents each as of January 7. Incremental amounts will continue to be charged after the initial ounce.

What few fail to realize is the impact one penny can have on revenues for the postal service. With an overall increase of 4.6 percent in postage, the postal service expects an increase in revenue of $2.7 billion, including $1 billion from the increase in first class postage.

Faced with a $199 million loss in the fiscal year ending Sept. 30, the Postal Service had no other choice than to increase postage. Many also do not realize that the Postal Service is not a government-run organization, and does not rely on outside funding.

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