Why Do Stamp Prices Keep Increasing?

Basic guidelines for running a business state that prices charged for products or services have to keep pace with changes in expenses. A merchant or retail store has to take in enough money to cover rent, payroll, office expenses and so on. This also applies to a semi-official agency such as the postal service, which is in the delivery business.
So, the bottom line is that the postal service increases the amount it charges so that it will have enough money to pay all of its expenses. Postage stamps are just a physical symbol of how much we pay to have a letter or other item delivered. In fact, stamps aren’t used all the time! There are also postage meters and official stamps that post office workers use to show that we have paid the agency to deliver our item.

In recent years postal services associated with national governments have experienced significant decreases in revenue (money coming in) because more people are communicating by text message and email. One good example is the decrease in the number of checks written and mailed to pay bills. Thousands of people now use the Internet to deposit money into their account and to pay bills. A society that doesn’t rely on paper is having a real impact on the postal service. Stamp prices have increased to make up for this loss of business.
As is the case with any business, the agency can reduce expenses by closing some post offices, laying off workers or not replacing retirees with new employees. This often helps the business keep the cost of its product or service from increasing since expenses are reduced or don’t increase.

Sometimes a business like the postal service has to increase the price it charges for service because operating expenses increase. For example, with gasoline prices twice as high as they were just a few years ago the postal services of all countries pay much more to keep their cars and trucks running. In addition, the expense of repairing and maintaining vehicles and buildings continues to rise.

Remember, a stamp is just the proof that we have paid for the service. It’s like the price sticker on an item at the grocery store. The postal service increases its price and indicates it by printing new stamps. In recent years, however, members of the public have had one method of avoiding increased cost – the “forever” stamp.

At some point, an individual has been able to buy a forever stamp that can still be used when stamp prices increase in the future. An individual mailing a letter won’t have to add stamps of two cents, for example, to the forever stamp. People have purchased these special stamps in large quantities as a hedge against the price increase. The postal service benefits by getting an influx of money to use even while the stamps people bought are on the counter or in a desk drawer. This is a great idea for both sides considering that the price of a first-class postage stamp was 25 cents in 1988 and just 33 cents in 1999. The price went up to 44 cents in May 2009.