Powergen abandons UK Royal Mail
Powergen has become the first major company to abandon the Royal Mail. The German-owned household energy company has moved contracts worth millions of pounds a year to Business Post, the monopoly-busting company that launched its alternative postal operations two months ago.
It is understood that a Vodafone subsidiary has also quit the Royal Mail for Business Post, which expects to sign another six customers soon.
Powergen sends out more than 40m letters, invoices and statements a year and is a major coup for Business Post.
Its UK Mail-branded operation earlier this year signed a licence to act as a postal middleman between pre-sorted bulk mailers and the local sorting offices of the Royal Mail, whose postmen remain responsible for so-called final mile delivery.
Business Post is guaranteeing delivery within two days for less than the average 17p per letter that Royal Mail charges its big commercial customers for its second-class service.
A Powergen spokesman said: ‘It has improved our customer service, we are getting more letters out the door every day, it is improving our cashflow and the price is competitive.’
Business Post chief executive Paul Carvell said UK Mail expects to make a GBP500,000 start-up loss this year on GBP15m of turnover. The target is GBP150m of turnover and operating profits of around GBP10m within three years.
