The man who wants to deliver your post – Nick Wells Interview

Nick Wells sold his marketing firm to the Dutch giant TPG for Pounds 20m. Now he is heading its bid to blow apart the Royal Mail's 350-year monopoly.

By the time I am up the narrow staircase Nick Wells is already apologising. "I bet you've not seen many offices as unglamorous as this?" he grins, waving his hand around.

Well, probably not. Wells's base for TNT Mail UK, the Dutch-owned business mail start-up that is taking on Royal Mail, is a small two-storey warehouse off a suburban road in outer Maidenhead.

The reception area downstairs fits two at a pinch. Wells's cardboard-walled office, overlooked by the bedrooms of the semi- detached houses opposite, might fit four. Even the three named directors' parking slots in the tiny car park outside seem more like desperate pragmatism than any folly of hubris.

And this will take on Royal Mail's Pounds 6billion business and 350-year-old monopoly?

"We'll probably move soon," says Wells, rather sheepishly.

But appearances can be deceptive. Wells, 45, heavy-set with white hair clipped short and lugubrious face lightly tanned, is a self-made millionaire who created his fortune in direct mail before selling out to the Dutch postal group TPG (turnover E12billion or Pounds 8.2billion). Now he is using his old Maidenhead base, near Windsor, to plot the Dutch assault on the juicier bits of Royal Mail's network.

As chief executive of TNT Mail, using a brand already known through TPG's TNT Express and TNT Logistics divisions, Wells has launched a mail service for high-volume business customers, undercutting Royal Mail rates.

Since its low-key start last August, TNT Mail has signed up a range of businesses including the food firm Booker, mail- order company Express Gifts, telecoms group Caudwell Communications and Sky Television. Banks, credit-card companies and energy groups may soon follow.

TNT is not alone, of course. The German post office, using the DHL brand, is building a business-post network in Britain and a further five companies have so far been granted licences to compete with Royal Mail. This, after the years of haggling over the introduction of competition into British postal services, is how the invasion begins.

For Wells, backed by the logistics might of TNT, which has sophisticated distribution hubs across Britain handling its business-to-business parcel service, the full liberalisation of the mail market in January cannot come soon enough. By the end of this year, in a partially liberalised market, he expects to be carrying 600m items.

Under the initial access agreements negotiated with the postal regulator and Royal Mail -which allow licensed operators to compete for large-volume business mail – TNT picks up the mail and then feeds it into Royal Mail's delivery system.

Eventually, he predicts, TNT Mail will establish its own delivery system to take business mail to consumers. He is not saying how yet, but he reiterates the obvious: "We are fortunate to have the TNT name and the support and resource of TNT's owner, the TPG group, which is recognised in the Netherlands as providing the most efficient postal service in the world."

But perhaps what's most surprising is to find Wells, a high-profile character in UK direct mail and former chairman of the Institute of Sales Promotion, at the head of the Dutch assault.

For a start, when he sold his below-the-line firms to TPG in 2000 he obtained an earn-out deal that gave him a quarter share of a sale price of more than Pounds 20m. He has now finished that earn-out -he bought a holiday home in Switzerland named Chalet Margaux, after his favourite wine, with the proceeds -and he hardly seems the sort who would be keen to jump into anyone else's corporate hierarchy.

Second, he has little experience of the addressed-mail market. He knows about delivery: he made his fortune stuffing promotions into letterboxes through his direct-mail firm, Circular Distributors. But he has never worked for a postal service. What's he up to?

"I am just really motivated by the opportunity," smiles Wells, sitting at a table in his modest office. "We want to be the No1 challenger in the addressed postal market, and industry leader in both quality and customer-orientated product and service development."

Others suggest the appointment is smarter than it looks. Wells has a mischievous urge to upset the status quo and a sharp eye for profit, and he has an entrepreneurial nous you probably wouldn't find by poaching talent from Royal Mail.

He also likes to win, and as a pioneer of "unaddressed mail", the jargon term for the free offers now regularly used by retailers, food groups and consumer goods firms, he has proved he can create opportunities where others see little. "That kind of mail is the unglamorous end of an unglamorous business," says one former customer, but Wells was very effective at it.

Business-to-consumer addressed mail -90% of the average postbag -is a different proposition. First, Wells has to show that those complex access agreements enabling him to use Royal Mail's delivery network actually work. So far, so good, he says. "We track and monitor, and we have a level of redress with the regulator, but I have to say they (Royal Mail) are doing the job."

But isn't it an odd form of competition, using Royal Mail to do half the work?

"I guess it seems a contradiction, using their services yet competing against them. What I can report is that access is working at an operational level."

What about Royal Mail's assertion that big operators like TNT and DHL just want to cherry-pick the most lucrative bits of the mail network?

"That's not true at all," he says, but doesn't provide a convincing counter-argument. Wells admits that TNT is not interested in picking up mail from postboxes or handling the small-scale consumer end of the market. What it will do, he promises, is offer businesses eventually a different route to consumers' letterboxes.

Wells has already cut a deal with Express Dairies, which has access to 5m homes, to deliver heavier items of mail. Other bits of Britain, you suspect, could soon be covered by TNT vans. But do we really want more people pushing mail through the door?

Wells shrugs. "You have lots of people coming to your door already -postman, newsagent, parcel delivery, free newspapers. Nobody has a divine right over the doorstep."

But can TNT deliver mail nationwide? Executives at Royal Mail are sceptical. "We have more than 100,000 postmen and women visiting 27m addresses," says one. "It's difficult to see them covering that."

Wells shrugs again and says: "We can't afford to upset the TNT brand, so whatever we do needs to be done to the best levels of service."

Those who watched Wells's rise in below-the-line marketing are surprised at his easy transition from maverick entrepreneur to multinational executive.

"I thought Nick would be in Barbados playing golf by now," says Peter Kerr, managing director of Multi Resource Marketing and current chairman of the Institute of Sales Promotion. "But I saw him make a presentation recently about what TNT Mail aimed to achieve, and I've rarely seen him so excited."

Paul Seligman, managing director of Communicator and a long-term friend, says taking on Royal Mail will appeal to the maverick in Wells. "He's got a bit of a devil about him and he won't mind working in someone else's corporate structure so long as he can influence the outcomes. He also has a really strong work ethic."

That work ethic was honed young. Brought up in Northamptonshire, the last of seven siblings, Wells says his whole family had the entrepreneurial streak. Dad was a manager at the local publisher Emap, mum ran two toy shops, his elder brothers went on to head their own businesses.

Wells was educated privately before studying sociology at Warwick University. "Not one of my best decisions," he says drolly, adding: "What do you say to a sociology graduate with a job? Big Mac and fries, please." He cracks up laughing.

But his people skills paid off later when he joined his brother's marketing-services business in the Midlands. By 1984 he had moved to Circular Distributors, then part of the Brunnings ad group. "We used to make most of the profits and they used to spend them."

That was rectified in 1990 when Circular Distributors' managers bought it out.

Wells was marketing director and put in Pounds 50,000 to become a major shareholder. By 1994 he was boss, and a prolific proselytiser for door-drop marketing.

But don't people hate it?

"Do you know what?" he says. "Loads of people say it's not popular, but ask them if they like getting free catalogues and product samples and information from the government, and they say yes. And here is something I am particularly proud of…"

He turns to a cupboard and pulls out a Gillette sample bag, part of a hang-it-on-your-door campaign offering free razors. "Over 40% of people who got it then hung it out to get the free razor, one of the most successful sampling operations ever undertaken by Gillette."

He is on a roll now, pulling more examples of Circular Distributors' work out of the cupboard, like a magician plucking surprises out of his hat. But isn't all that -the owner- manager who sells effectively -so different from his new role, which must involve, in the main, meticulous logistics?

He shakes his head. Getting the right stuff to the right door is what his business is about. And he has formidable back-up now, including an experienced operations director from TPG in the Netherlands.

Does he like working with the Dutch? He loves it. "They're open, direct, lots of integrity." He grins, always looking for the quip. "Mind you, they do have this strange affinity with herrings…"

Food is one of Wells's favourite hobbies, hence his good- living tum. He cooks for his wife and teenage children most weekends -"I'm more creative than meticulous" -and tries to fit in as much golf and tennis as he can to keep trim.

When we've finished Wells, ever hospitable, offers to drive me to the station.

Sitting in his Range Rover, we chat about tennis and teenagers and he delivers me to my train right on time -a good omen for his business, I should think.

VITAL STATISTICS:

Born: July 24, 1959

Marital status: married, with three children

School: Wellingborough, Northamptonshire

University: Warwick

First job: account manager, Alan Wells International

Salary package: Pounds 140,000 plus profit share

Homes: Ascot and Chatel, Switzerland

Car: blue Range Rover

Favourite book: Birdsong, by Sebastian Faulks

Music: Van Morrison, jazz

Film: The Life of David Gale

Last holiday: Mauritius

Interests: golf, skiing, tennis, wine

NICK WELLS'S WORKING DAY:

TNT MAIL's chief executive wakes at his home outside Ascot after 6.30am. Nick Wells starts his day with an espresso, then drives himself to his Maidenhead HQ, where he works from 8.30am to 7.30pm.

"I'm often in London, or up at Atherstone, TNT's main base. That's where your photographer squeezed me between two lorries. I thought he was going to give me a Yorkie bar to hold."

Twice a week he will go to the gym before starting.

"I work better later in the day," says Wells. Much of his time is spent in internal meetings, or making calls. As well as TNT Mail he has the two companies he sold to TPG, Circular Distributors and Lifecycle, reporting to him. He expects Circular Distributors to transfer to the TNT Mail brand eventually.

WORKING SPACE:

NICK WELLS works from a nondescript, two-storey warehouse on a suburban road opposite semi-detached villas in Maidenhead, near Windsor. His first-floor office, off an open-plan space, is 15 feet square and plainly furnished.

It overlooks the company car park. "We use the services of radial depots round the country. This office is just functional," beams Wells. "It's got everything I need."

Opposite his desk sits a large coffee machine. A newly commissioned set of abstract prints decorate the walls. They are part of TNT Mail's "Post Modern" launch campaign, representing the firm's 12 corporate values: partnership, accountability, care … "Postal operators traditionally show lots of trucks and vans. We wanted to be a bit different," says Wells. "Hence the 'Post Modern' message. But, obviously, the values are genuine."