Starting A Profitable Circular Mailing Service 

I'll break down this business for you.  When you mail a one-page flyer first 
class, there is a lot of empty space in that envelope.  You could fit 4 - 6 
more pages in there without going above one ounce, depending on the type of 
paper each page is printed.  This translates to 8 - 12 sides of advertising
that could be sent with your offer.  If you divide the cost of your mailing 
by the number of sides of advertising that you can include at no extra 
postage cost, you will get the cost per page.  A markup can be added to this 
cost per page, and charged to other mail order dealers, who will send you 
their flyers and ads to include with your mailing.  Thus, your offers can be 
mailed for FREE by selling the remaining "envelope space" to others, plus 
you'll make a profit.  You can actually get paid by others to send your own 
offers out!

Here's an example:  Say you have a one page flyer that you are sending to 
1,000 customer mailing list.  The postage for this (first class) would be 
$290.  Say you can fit 6 more pages in.  This would be 12 sides, or 
$24.16/side.  If you went an extra ounce, postage would be 52 cents/envelope, 
or $520 for the mailing.  A total of 13 unused pages, or 26 sides would be 
available, at $20/page.  As you can see, as you go up in weight, your cost 
per page decreases.

What you want to do is set your prices at a point where your costs are 
covered.  Then, observe what other mailing services are charging.  If you 
are far below them, add a markup and there's your profit.  If your cost is 
higher than what they charge, you have two alternatives.

First, you could send your mail by bulk mail, instead of first class.  This 
will greatly lower your costs, but you will need to sort your mail by zip 
code (not a problem if your mailing list labels are generated by computer), 
and you will need to send a greater number of envelopes.  Your post office 
has informative brochures on bulk mail permits and services.  If you don't 
understand some of their information (which will probably happen - it's not 
very  clearly written), the postmaster will be happy to explain whatever you 
need to know.  By using bulk mail, proper sorting techniques, and the other 
tips you'll get from the post office, you can easily cut more than half off 
your postage costs.  While bulk mail is a bit slower and not as reliable as 
first class, it is still good enough to be used by the large mail order 
houses, and will allow you to be competitive with the other mailing services. 
Most of them also use bulk mail, so you will not be providing a lower 
quality service than your competition.

Second, you could sell smaller space than a full page.  Divide your page 
into four columns, and sell ad space by the inch.  You will be creating your 
own ad sheet, which is a whole business in and of itself; one which is 
covered in greater detail in the next report.  You will make more money per 
inch from the smaller ads than from the bigger ads.  Depending on your 
circulation, a good ad sheet or two may come close to paying for the WHOLE mailing, making all the other flyers and inserts dealers pay you to send 
pure profit!

One idea to think about is to skip the envelope and create one page that 
can be used as the outside of the package.  Use half of one side of the 
paper for the mailing area, with your return address, space for a label and 
postage.  Put all the flyers together, with that page on the outside.  Fold 
them in half, staple, and you have a self-mailer that doesn't have the 
envelope's added weight.  On the other half of the outside page, you can 
either put advertising, or some enticements to whomever is receiving it to 
open it and read through all the pages.

Another wrinkle to explore is combining this service with the printing 
brokerage described in the previous report in this series.  This way, people 
who have offers but no preprinted flyers and ads can participate in your 
program.  These two services fit together hand-in-hand and are great to 
offer together, as a print-and-mail service.

If you combine bulk mail, ad sheets and full page mailing, you can easily 
cover the costs of mailing your own offers, plus make a profit.  Any mail 
order dealer would be smart to offer this service.

Mailing Circulars-Success As A Circular Mailer
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Ten Steps That Put You In Commission Mailing Business
How To Make Money Even When Your Ads Don't Pull
Starting A Profitable Circular Mailing Service Business
Start Your Own Ad Sheet Business
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The Complete Mail Order Business
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