Royal Mail modernisation boosted by £120m investment

Royal Mail has announced a further £120m phase of capital investment as part of the company’s continuing programme to create a fully modernised, world class postal service for consumers and businesses in the UK. Royal Mail has announced a further £120m phase of capital investment as part of the company’s continuing programme to create a fully modernised, world class postal service for consumers and businesses in the UK.

The latest investment is earmarked to provide new equipment for delivery postmen and women and is in addition to more than £800m which has already been spent on the modernisation of the business. Royal Mail is investing a total of £2.1bn in transforming Royal Mail and is on track to deliver that plan.

The new equipment will ultimately be introduced in all delivery offices and includes:

• Almost 9,000 more handheld tracking devices on top of the 27,000 already purchased to help track deliveries more precisely,

• 11,500 new vehicles to make sure that postmen and women are able to take everything for their round with them without the need to be replenished mid-way through the day,

• Almost 2,400 electric powered trolleys, 4,000 high capacity trolleys and 24,000 lightweight trolleys to take the weight off postmen and women’s backs and help them carry letters, packets and parcels safely and efficiently.

As a result, postmen and women will be better able to handle the increased proportion of packets and parcels in the mail bag – generated by the Internet shopping market – in a safe and efficient way.

Mark Higson, Royal Mail managing director, said: "We’re investing for a positive future, both for our customers and our people. We know that traditional letter volumes are now falling by up to 10% annually, and we’re absolutely focussed on the need to create an operation which gives us the very best chance of winning packets and parcels business in an intensely competitive marketplace. We’re hugely increasing our ability to track the delivery of goods and internet shopping orders and we are very determined to create the modern, efficient business that meets our customers’ needs and expectations.

"A successful future for Royal Mail , which protects as many jobs as possible and secures the one-price-goes-anywhere universal postal service, depends on making investments quickly and on everyone in the company playing their part in making change happen throughout our operation. I’m delighted with today’s announcement which shows that every delivery office in the UK will be able to make use of new equipment as well as modernising the way in which they work."

Modernisation in Royal Mail is already well underway. Since 2007 the company has:

• Already introduced 27,000 handheld tracking devices to record electronic signature on delivery for tracked mail, sending confirmation to the sender within 20 minutes and creating one of the UK’s largest corporate WiFi networks,

• Upgraded 138 Integrated Mail Processors in mail centres across the UK and started to expand a further 90 machines,

• Installed 21 ‘flat’ sorting machines to sort larger items automatically,

• Installed the first "intelligent" Letter Sorting Machines in the Jubilee mail centre in Surrey and in Edinburgh mail centre, and we have ordered a further 74 machines for deployment across the network,

• Installed the first walk sequencing machines – which can sort the mail sequentially to the route taken by a postman or woman – in Bristol in preparation for a national rollout of more than 530 machines. This builds on the business’s investment in upgrading and installing technology during the first phase of the on-track modernisation programme which increased our walk sorting capability to more than 80% of the mail we handle.

• Improved efficiency across more than 34,000 individual walks in line with the 2007 Pay and Modernisation agreement.

Within three years, Royal Mail will have 900 world class automation machines and will be sorting 75% of the addressed mail to the exact door to door sequence in which our postmen and women deliver.

Mark Higson said: "We’re continually improving efficiency – by modernising working practices and introducing the equipment to make every collection and delivery route more cost effective – so that we can offer competitive prices that will win and retain business. Royal Mail, rightly, doesn’t take any business for granted, and we know that competitors are chasing every packet and parcel in a fiercely competitive marketplace."