Exactly how relevant is the U.S. Postal Service (USPS) to the business world when it comes to payments? Not very, according to Servistree.com business users who’ve flocked to the company’s vCheck solution, enabling ready-to-print checks processed via the Web and rendering the phrase, “the check is in the mail” as irrelevant.
But the same may not be said for nonprofits who are protesting Congressional plans to gradually phase out USPS discounts they receive for mail appeals and other materials.
Lawmakers are concerned about huge deficits faced by the Postal Service, which lost $10-billion last year. Darrell Issa, a California Republican and the chairman of the House Oversight Committee said recently that mail volume has dropped 20% during the last five years because of new technology. In addition to talks about no Saturday delivery and the closing of some USPS branches, Issa introduced a bill that would gradually eliminate the discount charities receive. Sen. John McCain, the Arizona Republican, proposed similar legislation.
Businesses can rely on services such as Serrvistree, to continue business despite USPS cutbacks, however, charities currently pay 26% less, on average, than businesses to send direct-mail solicitations and other communications to supporters.
Those mailings are important for many charities. While electronic appeals have taken off in recent years, few large nonprofits have found anything as effective for fund raising as direct mail.
The lung association raises $31-million a year from direct mail and says it now spends $6.3-million on postage; Special Olympics raised $35-million from direct mail last year. Both organizations sent a letter of protest to Mr. Issa.
There is an assumption that nonprofits can simply move all of their fund raising online but be assured that if online fund raising were as successful as direct mail, with a substantially lower cost, it would not take a spike in postage rates for them to change their strategies.
While many for profit businesses are turning to technology services to conduct banking and payment processing operations, charities still rely on non-tech savvy donors and are eager to hear the phrase “the check is in the mail!”