ISBA issued a statement yesterday saying that member companies had "expressed their mounting concern" about the effect a national strike will have on their businesses.
Royal Mail postal workers are due to walk out tomorrow and Friday in the dispute over pay and modernisation plans.
David Ellison, ISBA's marketing services manager, said that if postal workeres were unable to resolve the conflict, direct mail business would go to Royal Mail competitors or force them to abandon direct mail in favour of email.
He said: "The strikes have really started to undermine the relationship our direct mail members have with Royal Mail and they are finding that alternative delivery services are become increasingly appealing. Some members have looked at short-term contingency plans with these other delivery services, while others are considering transferring their business permanently."
His remarks come as the Scottish Government announced it was awarding an £8m postal services contract to Royal Mail rival TNT Post UK. One Liberal Democrat MP said TNT's win was an example of the "haemorrhaging" of business from Royal Mail.
Ellison added that ISBA was looking for a "prompt" resolution "but not at any cost - [an agreement] has to allow Royal Mail to continue with its modernisation process".
Research carried out by the Centre for Economics and Business Research for Kelkoo estimates that a nationwide strike could cost UK businesses £1.5 billion in lost revenues.
ISBA is calling for clients that are concerned about the strike to contact David Ellison on davide@isba.org.uk.
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