Understanding the postal needs of small businesses (UK). L13982

The UK’s 4 million small and medium sized enterprises (SMEs) are an important sector – rightly described as the engine room of the economy. This sector has, however, been largely ignored in terms of developments in their postal services since competition was introduced. The competitive battle ground has, until now, been tightly focussed on winning the business of the bulk mailing companies.

Postwatch, the watchdog for postal services, commissioned RS Consulting to research the way SMEs both use the postal services and how they could see them changing. Postwatch has today published on its website the results “SMEs’ current and future postal needs”. Visit www.postwatch.co.uk/research to see the report.

Speaking at a Postcomm seminar organised to discuss last year’s strike action by Royal Mail employees Millie Banerjee, CBE, Chair of Postwatch said; “The research Postwatch publishes today highlights that as well as their ‘sending’ needs SMEs also rely heavily on the mail they receive. For these businesses the cheques really are in the post and they want them delivered as early as possible. They also want there to be a significant gap between the daily delivery of post and the last collection of the day, so that they can respond in day.

“Last year’s strike action would have been very worrying for many small businesses. If it had continued some small businesses may have struggled to recover. Royal Mail has to find a better way to resolve its disputes.

“The postal needs of SMEs cannot be ignored and our research will help achieve a greater understanding of their needs. Postwatch believes that a better understanding of small businesses may help to expand the search for market share of postal operators into this sector.

I am very pleased that this research has been completed in time to feed into the Independent Review of Postal Services.”

Clive Davenport, Chairman for Trade and Industry at the Federation of Small Businesses said: “The FSB welcomes this robust piece of research with detailed facts that gels with its own research. It shows that small businesses are essential clients to Royal Mail, yet it is interesting to find that recent changes to postal services such as pricing in proportion has not benefited small business at all, whereas it has helped large business immensely.

Well functioning postal services are vital to small businesses. The current difficulties facing Royal Mail and the closure of 2500 post offices resulting in a gradually diminishing postal service is a very worrying trend indeed.”

The key findings of the research are:
For most small businesses weekly outbound postal volumes are too low to attract postal operators’ attention. However, a third of SME’s do have occasional mailings large enough that they should be able to benefit from competitive choice;

Sole traders and SMEs post similar types of items, but sole traders post more to consumers;
Very few SMEs have made use of bulk mail services, mailing houses or competitors to Royal Mail;
Counter to the trend in the UK postal market SMEs overall say they have sent more mail over the past 2 years;
Overall SMEs expect to send more mail in the coming years;
SMEs are broadly satisfied with their current postal and post office services;
Variable delivery times were unpopular with about a third of SMEs; and
Interest in new services might be stimulated if they reduce costs and/or time.

Notes to Editors
SMEs are companies that employ less than 250 people.
Three quarters of the 4 million SMEs in the UK are sole traders.
For information about the Independent Review of Postal Services visit http://www.berr.gov.uk/sectors/postalservices/Review/page45129.html
For information about the FSB visit www.fsb.org.uk

More Information
Please contact Andy Frewin on 020 7259 1223 or 07900 263 004: or
Daryl Barrett on 020 7259 1239 or 07900 263 020.

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