Consignia: the gloves are off

Consignia: the gloves are off
Catalyst: The UK Post Office yesterday changed its name to Consignia.

27/03/2001 17:10:00 (CommentWire) – As it loses its monopoly on UK postal services, Consignia is shifting its focus to make sure it doesn’t lose revenue. It’s well on the way to becoming a one-stop-shop supply chain solutions firm, with services ranging from logistics to eFulfillment. Diversifying should allow Consignia to meet the challenge from its competitors, not just in the UK but globally.

On Monday, the UK Post Office officially changed its name to Consignia. The new government-owned plc is the first postal service to be licensed by the UK’s Postal Services Commission (PostComm), which will oversee the newly liberalized market. Under this regulatory regime, Consignia must provide ‘fair’ access to its network to express and courier competitors, offering ‘reasonable’ prices based on its costs. Yet Consignia’s subsidiaries (Post Office, Royal Mail and Parcelforce) will still be in a position to offer the most far-reaching national network for some time.

Consignia has anticipated the effects of liberalization, investing considerably in diversifying its operations into services such as eFulfillment, courier and express, and logistics and supply chain management solutions. At the core of this investment have been acquisitions on both sides of the Atlantic, following a similar strategy to other former national monopolies such as Deutsche Post. Consignia has already invested some GBP500 million on acquiring 20 overseas operators.

The firm still faces increased global competition from postal services, integrators, logistics companies and courier operators, as well as pressure to demonstrate a good financial performance. Fortunately, its new ownership structure presents Consignia with a greater source of capital for acquisitions and investment. The company is already expanding globally through operators such as Citipost, whose document delivery network spans across Europe, North America and the Pacific Rim, as well as alliances with global operators such as TPG and Singapore Post. Consignia is also investing in technology, sales and marketing.

The combination of a widespread national network with these overseas acquisitions and partnerships, allowing Consignia to offer a one-stop-shop supply chain solution, places it in a strong position. The company is reacting to the threat of competition in its core letter business by spreading its web across markets and industries. Rather than losing share to rivals, it is meeting them face on by becoming a force to contend with in their core markets. And it is doing this on a global scale.

Source: Datamonitor – 27/03/2001 17:10:00

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