Information based network process for mail sorting/distribution

A system for distributing mail items, which mail items are created by a number of originators for delivery to a number of recipients having different addresses through a postal service, which postal service has a set of postal regional sorting centers having an associated set of postal regions, which postal regional sorting centers sort incoming mail pieces for shipment to local post offices within the associated postal region for delivery to the recipients, comprising:

• a plurality of private processing centers each having an associated set of one or more destination codes, a plurality of which processing centers are originating processing centers that receive mail items from originators;
• wherein the originating processing centers sort the mail items received from originators into groups by the sets of destination codes for transfer of each group of mail items having a destination code different from one of those associated with the originating processing center to a corresponding destination processing center;
• and
• wherein a plurality of the destination processing centers sort mail pieces from originating processing centers, together with any mail pieces received directly from originators having a destination code which corresponds to one of those associated with the destination processing center, into batches effective to reduce total postage as compared to postage for mailing the same mail pieces with the postal service in an unsorted condition.

A system for allocation of cost savings for members of a network of processing centers, which network generates a net savings in processing costs by transferring items between network processing centers prior to delivery to a final destination, comprising a computerized system that:

• (a) determines a value of labor performed by each processing center in processing of items received from or sent to other processing centers;
• (b) determines a value of costs incurred by each processing center in processing of items received from or sent to other processing centers;
• (c) determines a value of cost savings generated by each processing center by comparing an actual cost to a benchmark cost;
• and
• (d) makes balancing payments between entities controlling the processing centers based on the values determined in (a), (b) and (c).