Taking the Periodicals Plunge

November 2009 — Could you be paring your postage costs by qualifying for Periodicals mailing privileges rather than using Standard mail?

If you’re paying regular Standard rates (rather than Standard nonprofit), you could see postage savings of 10 to 30%, depending on weight, advertising percentages and other variables.

Keep in mind, though, that the USPS asks a lot of you in return for those discounts.

Proper identification. Periodicals that don’t include an identification statement, as defined in the Domestic Mail Manual, can be rejected by the Postal Service — meaning you’ll be responsible for reprinting and rebinding the books in question. See section 707.4.12 for key requirements concerning location and content.

Established frequency. You’ll need to adopt a statement of frequency showing how many issues are to be published each year and at which regular intervals (for example, weekly; quarterly; four times a year in January, February, October, and November; monthly except during July and August), and reflect it in your identification statement and (where applicable) your subscription price.

And, of course, you’ve got to publish regular issues in accordance with the stated frequency or risk revocation of your Periodicals mailing privileges. For more information about requirements and compliance, see DMM 707.4.7.2.

Meticulous recordkeeping and annual reporting on your circulation. You’ll need to keep records that can support the information required on your application for Periodicals mailing privileges (more on that later) and to confirm eligibility for entry of the publication at the requested Periodicals price. You’ll also have to file Form 3526 or 3526-R — the Statement of Ownership, Management and Circulation — by October 1 of each year at the original entry post office. DMM section 707.8.3 outlines the deadlines for publishing a complete statement of ownership in an issue of your publication.

Miss these deadlines at your own peril: Publishers who do not comply within 10 days of a notice from the postmaster will lose their eligibility for Periodicals rates until compliance occurs.

Strict adherence to advertising rules. Since Periodicals publishers pay higher postage rates on the advertising portion of their magazines, you’ll need to know how advertising is defined in order to calculate your advertising percentage. Advertising is considered to include all material that “calls attention to something in order to get people to buy it, sell it, seek it or support it,” as well as “a newspaper’s or periodical’s advertisement of its own services or issues, or any other business of the publisher, whether in display advertising or reading matter.” See DMM 707.4.13 for a complete definition of advertising matter in Periodicals.

You’ll need to supply the postmaster with a marked copy of each edition of each issue — with the calculated percentage of advertising carried out to two decimal places — so advertising content can be verified when necessary. And don’t forget to include advertising matter printed on envelopes, wrappers, and the back of detached address cards when you’re measuring advertising space.

Close attention to loose enclosures. The USPS restricts the type of pieces that can be included as loose enclosures at Periodicals rates, insists that all advertisements in a bound publication be permanently attached (thus precluding the use of blow-in cards for anything other than subscription orders or renewals), and  applies strict definitions of what can and can’t be classified as a Ride-Along or Supplement To ... if you hope to avoid paying Standard mail rates for your enclosures.

For more specific information on loose enclosures, please see DMM 707.3.3.4 or contact your SMS account executive.

Sensitivity to the "five deadly sins." If your publication or any of its components contains any of the following printed items, it will be considered ineligible to be mailed at Periodicals rates: a separate price or subscription instructions different from those of the host publication; the word “catalog”; a First-Class Mail, Standard Mail, Parcel Select or Package Services permit imprint; an ISBN (International Standard Book Number); or an ISSN (International Standard Serial Number) or USPS number different from that of the host publication.

Taking the plunge

The first step, of course, is to determine your eligibility. Although there are actually five categories of publications that can be considered for Periodicals privileges, the two most commonly applicable are General (paid subscriptions) and Requester (mostly free to requesters or subscribers).

To qualify, a magazine must (1) be published in a serial format, (2) have an established minimum frequency of at least four times a year, (3) maintain an office of publication in the United States, and (4) be on printed sheets.

General eligibility
To be eligible for Periodicals status in the General category, your paid subscriptions must comprise 50 percent of your circulation + one copy. Note, though, that if your paid subscriptions account for less than 60 percent of your total circulation, you can expect a yearly audit.

• Subscriptions may be paid for with dues or contributions, if the dues or contributions and the subscription price are separated to show compliance. For example, dues statements would read: “Annual membership dues of [$] include [$] for a 1-year subscription to [Title].”
• At least 50 percent of a publication’s distribution must be to persons who have paid above a nominal price — no more than 70 percent off the standard subscription price.
• Publications cannot contain more than 75 percent advertising in more than half the issues published during any 12-month period.

Requester eligibility
“Requester” copies must account for 50 percent of your circulation plus one copy. As with General, if the percentage is below 60 percent, you should expect a yearly audit.

• Paid copies count.
• Free copies count if you have signed proof from the requester.
• For required proof of internet requesters, see page 33 of Handbook DM-204: Applying for Periodicals Mailing Privileges. (Note that references to the DMM include old section numbers; the DMM has been revised since the 2002 publication of this handbook.)
• You can’t have more than 75 percent advertising in any issue.

The application process

You’ll need to complete Form 3500 and include two copies of the issue published nearest to the date of application. These copies must contain a complete identification statement, and be marked to show the advertising content and the advertising percentage. Be sure the issue has well over 50% documented subscribers or requesters and well under 75% advertising.

The form, the copies and the fees — $540 for application and $85 for additional entry, both of them nonrefundable — should be filed at your local post office. Once the post office signs and stamps your forms, you’ll be able to mail as Periodicals Pending. You’ll still pay Standard mail rates until the USPS Pricing and Classifications Service Center (PCSC) approves your application — a process that can take anywhere from 45 days to one year. But once you’re approved, they’ll reimburse any difference between what you did pay and what you would have paid with Periodicals privileges, retroactive to the date you applied.

The PCSC will also assign an agent to review all your applications and the audit process, and should provide you with this person’s name and contact information.

Get more information on postal issues.

Return to the November 2009 issue of the SMS Register.

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