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UK Mail pushes for e-commerce growth with lower parcel rates

Thursday, February 7th, 2013

UK Mail Group has lowered its parcel delivery rates for customers of its next-day collection and delivery service, ipostparcels.

The Birmingham-based company said it has reviewed the parcels market, and in the light of predictions that the e-commerce business will grow 12% a year, it can apply a 50p cut in prices for five parcel sizes and distance zones.

UK Mail is hoping to tackle one of the key barriers to growth as seen by online merchants – high delivery prices – according to a recent study by Royal Mail.

The new pricing structure went live this week, with the ipostparcels 2-3 day service rate dropping to GBP 3.49 per item, with the standard next-day service reduced to GBP 4.49.

ipostparcels – available at the ipostparcels.com website – was launched in August 2011 specifically to serve SMEs, consumers and eBay sellers – providing an alternative to Royal Mail’s over-the-counter service.

The service has no minimum volume requirements, and so can be used for ad hoc collection and delivery.

UK Mail chief executive Guy Buswell said this week that his firm had intended “substantial” price cuts with a view to the growth expected from e-commerce.

“Our lowest price for next day delivery is GBP4.49 making ipostparcels the cheapest in the UK as well as the cheapest for extra-large deliveries,” he said.

“This will allow us to strengthen our competitiveness in the market as well as enabling smaller online businesses to have a professional yet affordable delivery service.”

UK Mail has a network of 55 sites and 3,500 drivers. Parcels account for about 39% of the company’s GBP 225m annual turnover.

E-commerce drove a 20% increase in the company’s parcel volumes over the winter.

Source: Post&Parcel/UK Mail Group

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