1. 2016 Price Change Shipping Services ©2015 United States Postal Service. All Rights Reserved.

2. Since 2010 the USPS has consistently kept price increases below industry averages No increase to Priority Mail in 2015, price reductions in 2014 The most recent Priority Mail price increase was in January of 2013 – nearly 3 years ago Average annual price increases of 4.4% this decade for all Competitive Products Net Minimums have risen at a much higher percentage than overall averages for the marketplace, particularly for residential deliveries The Postal Service continues to be the only commercial carrier offering ounce-based pricing for lightweight shipments The Postal Service does not dimensionally weight packages below 1 cubic foot (1728 cubic inches) 2

3. Current  The Postal Service has made significant investments over the past 5 years to support the growing business-to-consumer, ecommerce marketplace – nearly $2B in the last 24 months alone  Facilities  Vehicles  IT infrastructure  Processing equipment  Network capacity  The package business is crucial to the Postal Service’s future – we are committed to providing high value delivery services  The Postal Service offers the best value in the market

4. United States Postal Service  Predictable, consistent prices with no accessorials  No fuel, residential, delivery area surcharges  First price increase for Priority Mail since 2012  Priority Mail and First-Class Package Service provide reliable, fast 1-3 day transit time nationwide  Delivery 6 days per week, at no additional charge  Sunday available to over 70% of the US population  Only carrier in the marketplace to offer ounce-based pricing  Both First-Class Package Service and Parcel Select Lightweight remain high-value options for lightweight shipments  World-class package tracking and visibility  Multiple options for label generation and payment  Expert support to onboard new customers  Customer service support network

5. 2010-2016 Price Change History

6. 2010-2016 Price Change History Zone 2, 1 lb Package (Net Minimum)

7. First Class Parcel  Commercial Plus pricing eliminated (14 to 15.99 oz.)  Commercial Base pricing now includes ounce-based pricing up to 15.99 ounces  12.8% overall average increase  Eliminate ounce-based pricing below 8 oz – flat rate up to 8 oz.  Presort options eliminated (ADC, 3D, 5D)

8. Priority Mail Express  Commercial Plus pricing eliminated (14 to 15.99 oz.)  Commercial Base pricing now includes ounce-based pricing up to 15.99 ounces  12.8% overall average increase  Eliminate ounce-based pricing below 8 oz – flat rate up to 8 oz.  Presort options eliminated (ADC, 3D, 5D)

9. Priority Mail  Retain current overall pricing structure  9.8% average increase overall  Retail = 8.6%; Commercial Base = 9.4%; Commercial Plus = 13.3%  Eliminate Regional Rate Box C  Eliminate Critical Mail

10. Parcel Select  3.1% overall average increase for 1 lb+ Parcel Select  Parcel Select Nonpresort rebranded as Parcel Select Ground  5.1% DNDC; 4.9% DSCF; 4.5% DDU; Ground 1.9%  ONDC and NDC Presort categories eliminated  23.5% overall average increase for Parcel Select Lightweight  Simplify ounce-based pricing structure  Eliminate ounce-based pricing below 8 oz – flat rate up to 8 oz.  9-12 oz. category and 13-16 oz category  Eliminate Machinable / Irregular distinction – one price table

11. Parcel Return Service  5.0% overall average increase – same for RDU and RSCF  RNDC pricing eliminated

12. Other Domestic Charges  Standard Post will be renamed Retail Ground  10% average overall price increase  Domestic Extra Services  Premium Forwarding up 3.6%  Adult Signature up 3.6%; Restricted Delivery up 3.5%  Package Intercept up 3.3%  Competitive Post Office Box prices up 3.5% on average

13. International  Commercial Plus and Commercial Base prices will be the same  Global Express Guaranteed up 7.1%  Priority Mail Express International up 11.6%  Additional country groups added for Flat Rate Envelope; Flat Rate Box eliminated  Priority Mail International up 10.2%  Additional country groups added for Flat Rate; Eliminate PMI Regional Rate Box C  International Priority Airmail up 4.2%; IPA M-Bags up 3.5%  International Surface Airlift up 6.3%; ISAL M-Bags up 5.3%  Airmail M-Bags up 9.2%  First-Class Package International Service up 21.6%  Intl Postal Money Orders up 5.6%; Inquiry Fee up 3.5%; Transfer Service up 3.3-3.7%

14. 14 Thank you.