Stamping out old-fashioned postage meters

The days of the old, mechanical postage meters are long gone. Instead, the government mandates that all businesses can only use electronic postage meters.

Even if you already have an electronic meter, if your lease is ending soon it's not a bad idea to put your mailing needs out to bid now. With several hundred thousand meters still needing replacement, the four mailing systems companies are scrambling for this new business.

Postage meter systems consist of the meter, which dispenses the postage, and the base it sits on, which pushes the envelope through. Meters can only be rented, not owned, and the government closely guards who can distribute them: as of now, your choices are Pitney Bowes, Francotyp-Postalia, Ascom-Hasler, and Neopost.

It's best to be an informed buyer before you talk to even one vendor. Bases and meters are incompatible across vendors, so there is great incentive for salespeople to lock in a customer from the start. And don't let a salesperson tell you you have to rent the base, too; you can buy these outright, as well as the postal scale. Also, it's important that the postage meter you end up with is sufficient for your mailing needs. If you underestimate (which salespeople sometimes help you do intentionally), it may cost you dearly to renegotiate your lease mid-contract; it may even force you to "restart the clock" on your lease.

When negotiating your lease, watch out for cheap first-year pricing. Often, costs rise substantially as you move into the next year of your lease or as your usage increases, so look for these terms. Also, if you're upgrading to new meter with the same company, check the new lease carefully to make sure you are minimizing your costs. In reality, the higher price of the new model may be hidden in second year payment increases or much longer commitments.

Postage meters start at around $20 per month to rent. Any extra costs on top of that depend on whether you buy or lease the base (buying outright is usually cheaper), and whether you want to take advantage of ordering postage by phone ($5-$10 per order). Although it may be easier to order, it's rarely a good idea to get a "package deal" with a meter, base, and scale combined. For example, adding a fancy electronic scale to your "package" might run an extra $15 per month-but a third-party vendor could sell you the same scale for only $100.

The US Postal Service has recently approved a fifth company to sell postage: Estamp, whose Internet-based system will allow users to print postage from their own printers. Since there is little hardware involved, the costs are expected to be much lower. Expect to see it available by the end of the year.

Quick tips

Know what you need.Although salespeople may press you to buy add-ons like stackers at the time of sale, don't be swayed unless you definitely identify a need for them. Keep copies of everything. Do not rely on the vendors to forward you a copy of the signed agreement. In addition, make sure any blank areas of a contract are filled in before you sign. Figure in rate increases. Automatic scales need to be updated when postal rates chage, which, though it hasn't gone into effect yet, was proposed last year. Try to work this into your lease negotiations. Keep vendors aware of competition. Just mentioning an interest in the other manufacturers can often lead to substantial discounts or months of free meter rentals.

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