FLAT MAIL PREPARATION OPTIMIZATION February 24, FLAT MAIL PREPARATION OPTIMIZATION Issue #81 MTAC February 24, 2005

FLAT MAIL PREPARATION OPTIMIZATION February 24, Recently Completed Initiatives n Full merging of UFSM 1000 flats n CR and 5D combined on all 5D and L001 pallets according to new standards in M045 n Reallocation of Firm bundles n 5D FIRM bundles no longer contribute to 5% limit for merging n Three-digit bundle scheme for flats (L008) n Non-sacked Periodicals now eligible to be entered at DDUs

FLAT MAIL PREPARATION OPTIMIZATION February 24, Recently Completed Initiatives n New Labeling List L009 n Consolidates origin processing of MXD/residual flat volumes from approximately 100 ADCs down to 32 processing locations n No preparation changes other than the labeling for Mixed ADC bundles (modified OEL destinations) and Mixed ADC sacks n Effective early February, required use by May 15, 2005

FLAT MAIL PREPARATION OPTIMIZATION February 24, Major Initiative - APPS – Address Visibility / Readability n Federal Register Notice n Label on top piece must be visible n Banding – if cannot be positioned away from address block, clear strapping must be used n Shrinkwrap – haze recommendation (70%), with no seams or other obstructions over the address block n Position – address cannot be on the smallest side of the bundle n Optional bundle label can be used n Gathering input from the industry in order to shape the ultimate requirements

FLAT MAIL PREPARATION OPTIMIZATION February 24, Near-Term Initiatives n Reductions in Sacks n Eliminate shrink-wrap requirement for bundles on BMC pallets n Allow non-Sacked STD ECR to be entered at DDUs n Mixed/residual bundles placed on ADC and SCF pallets prepared for one of the 32 locations

FLAT MAIL PREPARATION OPTIMIZATION February 24, Near-Term Initiatives n Reductions in Sacks n ADC pallet protection n Lower required and optional minimum weights for last pallet level, for example, required at 250 lbs, optional at 100 lbs if dropshipped.

FLAT MAIL PREPARATION OPTIMIZATION February 24, Longer Term Sack Reduction Initiative n Allow flats to be entered at destinating plants outside of sacks n Bedloaded bundles n Tubs n Reintroduction of the Mixed/Residual Pallet n Would significantly reduce sacks n Pallets would be labeled to the 32 mixed processing locations, most equipped with APPS

FLAT MAIL PREPARATION OPTIMIZATION February 24, Future Initiative – Combined Preparation of Mixed Classes n Options → Co-Palletization and Co-Mailing n Working with interested parties within the industry to model the impacts of co-mailing n The industry interest is primarily with the co- mail option based on the potential workshare incentives n The results of the modeling, anticipated by the next MTAC, will be used to gauge interest in a test with live mail.

FLAT MAIL PREPARATION OPTIMIZATION February 24, Questions??