How Large Organizations Can Save on Mailing Fleet Costs Adam - - PowerPoint PPT Presentation

How Large Organizations Can Save on Mailing Fleet Costs

Adam Lewenberg - Background and Experience

• President of Postal Advocate Inc.

– The only mail audit and recovery firm in the US and Canada – Manage a portfolio of 85,000 pieces of mailing equipment for the largest US companies. – Speak and teach nationally on mail savings and industry trends.

• Industry Co Chair- Boston Postal Customer Council/Mail Systems Management

Association member. CMDSS and MDC Certifications.

• Featured Writer for Mailing Systems Technology Magazine.
• Worked for one of the largest mailing vendors for over 17 years

– Director of national sales for presort, tabletop inserters, addressing hardware/software and green offerings. – Was one of the top 5 account managers nationally working with some of the nations top accounts.

• Not affiliated with any mailing vendor - Unbiased advice.

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What We’re Covering

• 1. Challenges – The challenges organizations with large mailing fleets face
• 2. Visibility and Analysis – How gaining a thorough understanding of this

complex category will save time, reduce costs and increase efficiency across your fleet

• 3. Equipment Savings Process – The process to reduce mailing equipment

costs without compromising vendor quality or service

• 4. Eliminating Vendor Fees/Overcharges – Steps to finding mailing vendor

fees and overcharges

• 5. Lost Postage Recovery – Tracking down lost postage for closed locations,

mergers and dormant accounts

• 6. Developing an Equipment Purchasing Strategy
• 7. How We Can Help - Best-in-Class Tools – Complete visibility to spend

using the most innovative tools, resources available along with on-going maintenance and support

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4

Challenges of Managing Fleet Mailing Assets

Areas for improvement

Multiple postage accounts to fund and maintain Difficult to assess needs

• r

requirements No centralized

• versight

No control of rogue spend Resources or Time to Execute No published pricing for comparison Poor Visibility Inconsistent prices for similar equipment Unclear invoices Connecting Devices to the Network

Challenges With Mailing Equipment Purchasing

• 1. Huge price variances for similar models at different locations across

your fleet

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Example:

Model Pricing Variance

Model Quantity Low High Average High/Low Ratio Total Expense Total if all at Low Rate

Model A

9 $348 $701 $459 2.0 $4,133 $3,132

Model B

36 $345 $1,573 $801 4.6 $28,839 $12,420

Model C

26 $427 $2,063 $1,296 4.8 $33,703 $11,102

Model D

13 $1,427 $2,760 $2,019 1.9 $26,250 $18,551

Model E

26 $1,524 $4,467 $2,666 2.9 $69,325 $39,624

Model F

5 $3,251 $6,276 $5,352 1.9 $26,764 $16,255

Model G

5 $7,848 $9,931 $8,931 1.3 $44,655 $39,240 Total 120 $233,669 $140,324 Potential Savings $93,345

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• 2. Expired or non existent Master Service Agreement
• 3. Lack of visibility to postage spends and usage levels.

Companies buying the wrong levels of equipment. In many cases spending more on equipment than postage/usage.

Spend Ratios

Postage Range # of Sites Equipment Spend Postage Spend Spend Ratio >$12,000 per year 2 $26,600 $63,500 0.42 $1200-12,000 per year 64 $189,054 $155,441 1.22 <$1,200 per year 76 $120,291 $41,890 2.87

Challenges With Mailing Equipment Purchasing

Main Cause – Reliance on mailing vendor to work with the locations to define requirements combined with declining mail volumes.

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Challenges With Mailing Equipment Purchasing

• 4. Vendor inventory reporting is infrequent, unavailable and

confusing

• 5. Lease portfolios with varying end dates often going into

evergreen statuses.

Lease Renewal Dates

Lease Expiration Year # of Sites Value 2013 or Before 19 $28,404 2014 9 $12,198 2015 34 $62,193 2016 26 $54,455 2017 19 $30,795 2018-20 22 $35,691 Total 129 $223,736 68% of your leases are coming up

• ver the next

year.

Equipment Savings Process

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Optimized Mailing Fleet Asset Management

1. Gain visibility to your equipment and spends. 2. Validate questionable charges. 3. Negotiate enterprise pricing and terms. 4. Work with locations on equipment changes. 5. Eliminate fees and overcharges 6. Maintain postage balances and claim lost funds. 7. Continual review to ensure savings.

This process leads to 30-70% savings!

Analysis and Visibility

• Get reports from your vendors that list:

– Account Numbers (Install, Lease, Prepaid and Advance Postage) – Lease Information – Rate, Term, End of Lease, Items covered. – Meter rentals and maintenance agreements. – Model, serial number and description of every item.

• Go to accounts payable and pull spend reports from the main mail

vendors and USPS.

• Enter your account numbers on the vendor websites.
• Monitor your inventory, invoices and postage balances online

(Recommended to do this monthly).

• Find all active locations with equipment.
• Set up a schedule for continual review.

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Eliminating Vendor Fees/Overcharges

• Pay bills on time.
• Look at each invoice and validate all

chargeable items.

• Cancel vendor equipment insurance.
• Terminate chargeable loyalty programs.
• Make sure postage refill and advance

charges are included or monitored.

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Postage

Refill Fees - Rentals $0-20 each Postage Advance Fees Included or up to 1% of the Advance Postage Advance Late Fees 0-15% of the Advance Postage Advance Finance Charges 15% or higher APR Overlimit Credit Charge Varies by Vendor Annual Fee Rewards Program Varies by Vendor

Lease

Late Fees Varies by Vendor and Lease Value Insurance - Leases Only Varies by Vendor and Lease Value - Automatic enrollment unless proof insurance is provided.

Mailing System Fees

We find companies paying tens of thousands in fees and overcharges that can be recovered or eliminated for the future.

Postal Advocate Avoidable Fees and Overcharges Savings Stats 4266 Transactions - $5,473,438

Typical Vendor Overcharges

Invoices not giving national account discounts. Meter, maintenance and rate change charges when included on a lease. Bills for equipment from closed sites. Reset and advance postage fees that should be included. Loyalty points that go undredeemed or cashed in for personal use.

Lost Postage Recovery

• We have found over $2,460,000 in lost postage sitting in dormant postage
• accounts. Plus over 27,000 transactions turned over to the states. This

happens because: – Offices close, merge or just turn in their meters. – The money is expensed once sent in for postage. – The advance account is used when funds sit idle in the prepaid.

• Steps to find money.

– Find account numbers of your current and past meters. – Enter these account numbers online on the vendors website to see if any data is available. – Contact your meter vendor to validate funds available. – Check the unclaimed funds databases to see if funds were turned in.

Postal Advocate can research these funds and help you get them returned.

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Developing an Equipment Purchasing Strategy

• Use national spend to negotiate better rates.
• Consider running a bid between the main mailing vendors. (Pitney

Bowes, Neopost, FP, Stamps.com)

• Negotiate Master Service Agreement and Terms.
• Define the order process inside your organization.

– Purchase vs. lease vs. rental? – How are the equipment needs defined? – Where are approvals done? – How can the policies be enforced?

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How Postal Advocate Can Help

We can pull this spend together for the US and Canada. We have bid templates ready that we have used to negotiated for the largest mailing fleets. We can add and review terms to protect you for the future. We can guide you through your options. Postal Advocate will work with your locations to show options and help implement changes. Postal Advocate will manage this process to ensure rules are being followed.

How Postal Advocate Can Help

• We can work with all vendor’s data and can build this

visibility.

• We maintain this data in our enterpriseAdvocate System

and provide you access.

• We update this data monthly.
• We use this data to drive savings through your portfolio.

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Enterprise Advocate – Multi Location System - Dashboard

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The data above is for demonstrative purposes only. Data does not represent true spends and costs.

Enterprise Advocate – Multi Location System - Dashboard

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Highlights

• Simple access to all mail spends.
• Visibility to fees and savings.
• All account numbers are stored in one place.
• Simple to drill down to an individual location or invoice.

The data above is for demonstrative purposes only. Data does not represent true spends and costs.

Spend Ratio

What are we spending on the equipment compared to the postage used.

Enterprise Advocate – Location View

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Validate Equipment Spends with Locations

We typically find 5-15% of a mailing fleet is not needed and can be returned.

• Bills often sent to accounts payable with limited review.
• Locations not surveyed about the equipment at the site.
• Little understanding of the equipment listed on bills and reports.
• Vendors have little incentive to validate suspect equipment because of lost

revenue.

• Equipment may be sitting in storage with charges accruing.

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Criteria for Search:

• Meters not filled for over 6 months.
• Expired leases.
• Maintenance and meter rentals.
• Equipment over 5 years old.
• Folders, inserters, openers, shipping

and tracking systems.

Postal Advocate Validation Process

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• 1. Find suspect equipment and

charges.

• 2. Contact the location to validate
• needs. (See below).
• 3. Implement changes and

cancellations.

Renewal Process

• Who works with the locations to define the needs and provide options?

(Vendor, staff)

• What review process is set up to make sure it is the right solution?
• How do you protect against:

– Evergreen clauses – Remaining balances – Unauthorized lease extensions – Unneeded equipment or wrongly sized models – Locations not getting national account discounts

• Who follows up with each location to make sure new equipment is set

up and the old equipment was removed?

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Postal Advocate Equipment Renewal Process

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Step 1: Customized Renewal Email

Implement renewals, terminations and new equipment needs. Analyze current pricing and terms. Set Standardized equipment rates and updated MSA’s. Document all new equipment, savings and notes. Work with locations to define needs and show options.

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Postal Advocate Equipment Savings Stats

Savings Type # of Transactions Total Savings % of Savings Equip Savings: New 358 804,045 $ Equip Savings: Renewal 4113 26,403,748 $ Equip Savings: Terminate 2375 1,928,986 $ Total 6846 29,136,779 $ 60%

Customized Renewal Email

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Detailed Location Information Company Defined Purchasing Process. Compare Current Equipment and Costs to new options. Detailed description on all equipment. Web, PDF and Video links for more information.

Step 2: Equipment Change Request Form

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Step 3: Equipment Ordered Validation with Instructions

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Step 4: Client Validates Completed Request

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He lping multi- loc ation

• rg a niza tio ns stre a mline

the ir mailing c osts

Ove r 85,000 pie c e s o f

e q uipme nt, ma na g e d b y Postal Advoc ate

Re c ove r e d o ve r $7,994,875

in lo st po sta g e , ve ndo r

• ve rc harg e s a nd fe e s

E NT E R P R I SE

• WI

DE MAI L AU DI T AND R E COVE R Y

OVE R$32,000,000 I N CL I E NT SAVI NGS

$893K 60%

Ave rage Clie nt Savings Ave rage E quipme nt Savings

HOW WE DO IT

• 240+ ye ars o f industry e xpe rie nc e
• Co mpre he nsive we b -b ase d to o l

pro viding visib ility o f all mail and e q uipme nt spe nd

• T

ime Saving s - Assistanc e in fle e t manag e me nt

visit www.postaladvocate.com or call (888)977-MAIL(6245)

Sig n L

imite d Ag e nc y Ag r e e me nt/ Kic k- Off Ca ll.

Pro vide c o pie s o f ve ndo r

invoic e s, AP e xpor t, loc a tion list, e quipme nt inve ntor y list.

Pre se nt sa ving s oppor

tunitie s

a nd g e t c lie nt a ppr

• val.

Po sta l Advo c a te pro vide s

• ng oing suppor

t,

ma na g e s r

e ne wa ls, billing

a nd ve ndor

c omplia nc e.

Pro vide e nte r

pr ise visibility o f

a ll spe nd, c osts a nd do c ume nte d sa ving s thro ug h e nte rprise Advo c a te . Pro vide c lie nt log - in.

1 2 3 4 5 6

HOW I T WOR KS

Wor k with c ur r e nt ve ndor to b uild po pula tio n

re po rt, c o ntra c t te rms/ sta rt/ e nd da te s, po sta g e vo lume s, c o sts.

Analyze spe nd, c he c k fo r c o ntra c t

c o mplia nc e , b illing e rro rs, ve ndo r fe e s/ o ve rc ha rg e s, lo st po sta g e . I de ntify savings oppor

tunitie s.

Sub mit ve ndo r c r

e dit r e que sts, lost postage for ms a nd

e limina te avoidable fe e s. Ne g o tia te pr

ic ing. Cre a te c atalog.

Wo rk with lo c a tio ns -

asse t validation, r ightsize , te r mination…

F ull imple me nta tio n o f savings.

visit www.posta la dvoc a te .c om o r c all (888)977-MAIL

(6245)

Conduc t Ana lysis

NO COST – AUDIT PHASE CONTRACTED CLIENT

Free No Obligation Mailing Fleet Analysis

• Completed in 2-3 weeks
• Outlines, spend and specific savings opportunities
• Minimal client involvement

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Savings Summary

Locations Meter Rentals Maintenance Agreements On Call Maintenance Lease Total Postage Spend Ratio 0.00 Item Current 2015 2016 2017 Savings Combined Savings

Equipment Costs

Avoidable Fees

(Late Fees, Finance Charges, Equip Insurance, Loyalty Plans)

Contract Violations

(Supply, maintenance, meter discounts, overcharges)

Lost Postage Funds (Meter Accounts) Lost USPS Permit Funds Total $0 $0 $0 $0

$0 $0

Fleet Cost Savings Process

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Summary Optimized Mailing Fleet Asset Management

• 1. Gain visibility to your equipment and spends.
• 2. Validate questionable charges.
• 3. Negotiate enterprise pricing and terms.
• 4. Work with locations on equipment changes.
• 5. Eliminate fees and overcharges
• 6. Maintain postage balances and claim lost funds.
• 7. Continual review to ensure savings.

This process leads to 30-70% savings!

Contact info: (20pt)

September 20, 2017 30

Questions?

Contact: Adam Lewenberg - President 888-977-MAIL X 501 adam.lewenberg@postaladvocate.com