The following is meant to be a general overview of distribution drop shipping methodologies as related to catalog and publication distribution. Some basic similarities apply to both standard and periodicals class mail distribution. It is offered as an informational service of Fry Communications, Inc. Mailers are encouraged to review their mailing objectives to ensure that both delivery and cost goals are identified and optimized.
Types of Distribution Plans
There are two basic types of distribution plans. The type of plan used is often determined jointly by the mailer and printer, based on the mailer’s defined goals using cost, volume, and time guidelines.
Exclusive Plan. An exclusive plan is generally structured to meet the goals of a single (or limited few) publication or mailpiece participant(s). Generally, a single or limited few publications or catalogs may, by virtue of their volume, find an effective opportunity to ship in an exclusive plan that is tailored to the needs or profiles of those participants. An example is enough copies to fill a truck to go directly to a single BMC or SCF destination.
Pool Plan. A pool shipping plan, generally, is a shipping program which has a periodic delivery to a fixed number of USPS destinations. The pool is comprised of many titles or catalogs going to one or several Postal entries in its route.
As you would suspect a mailer may participate in either type of distribution plan – or both – as it meets their goal of delivery or cost.
Goals of Distribution Plans
There are two basic goals of distribution plans.
Cost Optimized Distribution Plan. This plan is designed to achieve the lowest cost of distribution by pursuing maximum postal discounts through deep penetration of products into the postal system closest to the end recipient or subscriber. The USPS offers increasing levels of discounts for copies brought closer to subscribers through both “drop shipping” discounts and “worksharing” discounts. Both discounts are a result of the mailer doing more of the work of USPS in either transportation (through zone skipping) or sortation.
Careful consideration in balancing freight cost versus discounts achieved is critical to ensure the cost of freight does not outweigh the value of the discounts. Similarly sortation efforts should be controlled.
An astute buyer recognizes that the “acid test” analysis of this effort is “the total delivered cost;” that is, the combined cost of freight, postage, administration, and data processing, added to the cost of print.
Delivery Optimized Distribution Plan. This plan is designed to achieve a fixed or highly predictable “in home” delivery window. Again, this plan is cognizant of USPS discounts, but its key goal is specificity of an in home delivery window. Penetration into the postal system is structured to the recipient/subscribers’ geographic dispersion or that of those participating in the pool.
Generally, the narrower the in home delivery target, the more Postal destinations are included, which generally adds costs. Mailers usually strive for an effective balance of an in home range versus costs.
General USPS Delivery Guidelines
The USPS service standard states guidelines of 3-6 days from BMC to “in home” and 3-4 days from SCF to “in home.” Therefore the plan’s first event is targeting its arrival at the proper postal facility. That is normally achieved in a range of several days. Consequently, in home arrival follows the respective USPS service standards.
Fry optimizes its postal plans to target the right postal entries based on the mail profile of the participant publications/catalogs. If appropriate, we will manage different delivery targets for BMCs compared with SCFs.
Formulating A Distribution Plan
Mailers need to match in home goals with the practicality of pool shipping and USPS guidelines. As you also know, there is variance in the delivery systems as well as weather and services issues. Carriers will occasionally have misses; the USPS will have delays at certain facilities. These are the realities of the distribution industry, and create an impact to in home arrivals.
So, given all those choices and variables, what’s a mailer to do?
Naturally we’d suggest meeting with a Fry representative as a good starting point.
General guidelines to consider
When do you want your catalog/publication to arrive at the recipient’s home?
As often “time is money,” you may balance the “in home” target with the lead time you allocate for providing “materials” and “a proof okay.” Direct or expedited shipping can be employed to allow your product to be received more quickly than when traditional methods are used after leaving the printing plant for time critical products. Participation in a regular pool program typically suffices for most mailers needs.
What is your desired in home delivery range?
Typically an in-home target range of four days is fine for many, with a small percentage of copies arriving both before and after that range. Knowing that variance up front will give ample indication to call centers, product announcements or price synchronizations. Some catalogers and many magazine publishers focus on ASAP delivery, with the result that subscribers nearer the printer receive their copies sooner than their cross-country counterparts. Other mailers require exclusive shipping – often expedited – to achieve their delivery targets.
Make a data file available way ahead of production to project a plan and its costs.
Fry (and most printers) can easily review a data file of addresses and project a delivery plan and costs using your data and defined delivery goals. Most service-oriented printers, including Fry, will also present suggested alternatives that make sense for you. This is critical for a new project and also keenly important when comparing catalog proposals. It is the only way you can accurately forecast total delivered cost.
Evaluate the proposed plan’s cost.
Consider all of the following:
Postage cost – a pro forma 3541 or 3602 or postage forecast.
Freight cost – total and cwt.
Data processing – sortation and postal compliance.
Administration – fees associated with managing pool and freight payment.
Evaluate the proposed plan’s effectiveness.
Consider all of the following:
In-home arrival relative to the “okay to print” date. How long from the time you “close” till the product arrives in home?
Percentage of BMCs – as relates to delivery date
Percentage of SCFs – as relates to delivery date
Now, weigh cost versus effectiveness.
Cost and effectiveness must be both considered to fully evaluate a distribution plan. High penetration into the postal system may raise freight costs more than it reduces postage. It may not always buy more expedient delivery. Similarly, a low hundred-weight freight quote may not yield adequate postal penetration to meet the delivery requirements.
Always review total delivered costs!
The following is an example of a catalog event of 469,000 copies with a national distribution, weighing less than a pound, and mailed Standard Mail.
Fry Communications Inc. is one of the industry’s premiere sources for publishers and catalogers. We offer complete consultation as to the exploration of cost saving opportunities, whether you are drop shipping a periodicals class publication or a national catalog, or fulfilling a journal. As a major mailer, Fry provides an array of services such as in house pre-sort, co- and multi-mailing, alternative delivery, and newsstand shipping, and is uniquely qualified to present mailers with effective, insightful and informed solutions. Our core strength of customer focused solutions allows us to employ our Fry YES! approach to provide innovative solutions for our client’s most demanding and varied requirements. The result is a custom tailored plan that meets your particular needs.