Bulk Mailing Money up Front...
- Thread starter kdw75
- Start date
Keith
Well-known member
I read that in Quick Printing magazine awhile ago. It's industry standard to collect postage up front so I always do. But I have a question about how to do the bookkeeping. How do you put the postage into your accounting program? I use Quickbooks and when a customer gives me money for postage, I put it under "Other Income". Usually I try to get my customer to make the check out to the post office so it doesn't even touch my accounts. But one of my customers said that their other vendors cannot accept postage checks made out to the post office. I guess some post offices do not accept third party checks?
As with all things, this can be negotiable and can actually be the way to tip the scales for work to come to your shop.
If you have a customer who pays promptly and has a small mailing, you'd have to be somewhat daft to put them through the whole "postage check" scenario that some of my dumber competitors do.
We want it to be easy for our customers to do business with us. We may let our customer know that there will be a "money handling surcharge", but that can be easily justified on many a mailing (less checks for their accounting department, etc.).
But remember that it's a risk. Is the customer worth the risk?
If you have a customer who pays promptly and has a small mailing, you'd have to be somewhat daft to put them through the whole "postage check" scenario that some of my dumber competitors do.
We want it to be easy for our customers to do business with us. We may let our customer know that there will be a "money handling surcharge", but that can be easily justified on many a mailing (less checks for their accounting department, etc.).
But remember that it's a risk. Is the customer worth the risk?
kdw75
Well-known member
We have had a couple clients that balked at paying the postage upfront, but then went ahead and did it. They are regular clients, and I didn't want to be the odd guy out on collecting upfront, but for a small business, like we are, thousands of dollars for postage hurts cash flow.
Exactly right... use your resources the best way. Sometimes it makes sense, sometimes it doesn't make sense to collect up front. That's why we call it "intelligent competition"... not every job is worth winning for every printer.
MailGuru
Well-known member
The correct answer depends on several factors. First, since the USPS does not give mailers "terms" on postage, it should always be an "upfront" cost.
Now, if the frequency of the customer's jobs is sporadic, only once in a while, we create an invoice for the postage (paid to us, not the USPS), and make sure that the customer knows that, while print & mail services are standard net 30 terms, the postage invoice must be paid prior to the actual transportation to the post office (in our case, we write the check for postage to the post office).
Now, if the customer is doing regularly-scheduled weekly, or, daily jobs, this method is going to become quite cumbersome and complicated. In those instances, we create an "in-house postage" deposit account and request that the customer keep it at a level that we can "draw-down" on the account for each mailing (usually 1 - 2 months worth of their average weekly postage at a time). Once it gets to a pre-determined minimum level, a postage invoice is created and the customer pays the invoice and replensishes their account. Thier easy to maintain with a simple Excel spreadsheet.
That being said, if that "regular" customer is a prestigious one, or, one of our larger accounts, and has a good history of always paying us, I am NOT going to stop their mail and risk losing that client because their postage deposit account is negative. In those cases, you just have to "bite the bullett" and hope you have enough cash reserve to pay the postage for them.
-Best
MailGuru
Now, if the frequency of the customer's jobs is sporadic, only once in a while, we create an invoice for the postage (paid to us, not the USPS), and make sure that the customer knows that, while print & mail services are standard net 30 terms, the postage invoice must be paid prior to the actual transportation to the post office (in our case, we write the check for postage to the post office).
Now, if the customer is doing regularly-scheduled weekly, or, daily jobs, this method is going to become quite cumbersome and complicated. In those instances, we create an "in-house postage" deposit account and request that the customer keep it at a level that we can "draw-down" on the account for each mailing (usually 1 - 2 months worth of their average weekly postage at a time). Once it gets to a pre-determined minimum level, a postage invoice is created and the customer pays the invoice and replensishes their account. Thier easy to maintain with a simple Excel spreadsheet.
That being said, if that "regular" customer is a prestigious one, or, one of our larger accounts, and has a good history of always paying us, I am NOT going to stop their mail and risk losing that client because their postage deposit account is negative. In those cases, you just have to "bite the bullett" and hope you have enough cash reserve to pay the postage for them.
-Best
MailGuru
oxburger
Well-known member
Depends on who it is. If it's an established client, we tend to front the postage and just invoice them for it when we bill the job. For newer clients (or smaller clients), we like to have a check before or when we drop the mail. We don't have it come into our system for accounting purposes. We have them make the check out directly to the USPS referencing whatever permit the money is going into.
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