Mailroom Offers a Host Of Cost-Saving Opportunities
There is never a bad time for credit union managers to improve their operational efficiencies. But with the uncertainty of exactly what financial reform will cost, lingering unemployment rates, a sputtering economy and tighter margins on financial services, today is perhaps the best time to closely examine every process in the credit union.
Improving operational efficiencies usually conjures up images of extensive software overhauls, such as a new core system, revamping the member service call center, or adding remote or mobile banking systems.
But for most credit unions, there are easy solutions in commonly overlooked departments that can yield tens of thousands, if not hundreds of thousands, of dollars in cost savings that directly benefit members.
Two areas that credit unions should look at today are the mailroom and member statements. These two critical tasks are interrelated, since every credit union must design, process and print member statements, and then they must deliver those statements to members.
For most credit unions, the majority of statements are still delivered by mail. The key to improving operations and cutting costs in the mailroom revolve around postage rates. The more a credit union can do to ensure mail piece deliverability, the lower the annual mailing costs. Credit unions that maximize postage discounts through manifesting and barcoding can save up to 25% over first-class rates in postage costs alone. This can easily equal upwards of $10,000 per year.
To automate the mailroom and take advantage of these savings, credit unions should implement a system that does four things:
Automate the printing and design of member statements. Credit unions should implement systems that help them design member statements that can be customized to share targeted marketing messages. Printing systems should also be able to drive statements through the printer at its fastest rate, selectively insert additional materials, and ensure that all pieces were accurately printed.
Automate addressing. Credit unions should utilize software tools that can automatically verify addresses and identify incomplete or incorrect addresses, including use of Intelligent Mail Barcodes (IMB) to further provide address automation and save costs, since the Postal Service charges less for mail that meets the IMB standards.
Automate the sorting and stuffing process. This eliminates the need for CU staff to manually stuff statements into envelopes and sort them for the Postal Service. Computer-driven systems can print statements, stuff them and sort them into mailing groups to minimize postage rates. The Postal Service has many complex rules on how to sort mail for maximum discounts, and automated software can save credit union staff hours of work.
Reduce equipment and supply costs. Automating the mailroom often means that credit unions can eliminate expensive postage meters and all of their associated supplies.
While credit unions are optimizing their mailroom operations, there is also the opportunity to ensure that creating and changing member statements is as efficient as possible. Credit unions should look for ways to include cross-promotional materials in statements and reinforce the credit union's brand through consistent graphics. The statement system should make it easy to customize statements and make targeted changes.
Credit unions have several options for implementing these improvements. Some credit unions decide to outsource the process, and there are benefits to letting another company handle all of the logistics of mailing statements. However, the most secure and member-focused way to significant cost savings will come with implementing simple-to-use software that integrates with the existing core system and printing network.
Credit unions should be able to save enough on postage expenses in the first year to pay for the software, and the savings only increase each following year. These savings directly benefit your members' bottom line.
Harry Herget is director of marketing for Jonesboro, Ark.-based SynTel, LLC, a provider of mailroom automation software and document design software. For info: www.syntelllc.com.