The week that was: 1 October 2010

USPS rejection, Royal Mail saved from pay-out, and Nordström heads for Posten Norden exit… Wow, it’s October already. Time may be flying by, but hopefully you will still find a minute or three to sit down and enjoy ‘the week that was’ – the hottest mail and express round-up from across the globe.

It hasn’t been the best year for USPS, as the company’s ongoing financial troubles threaten its existence. Yesterday, the US Postal Regulatory Commission (PRC) heaped more misery on the businesses as it rejected Postal Service plans to increase the price of sending a letter by 2 cents. The proposal – which would have seen the cost of a letter rise to 46 cents from January 2011 – was discarded by the regulator in Washington. Under the proposal, the price of mailing a letter would have increased 5.6%, far greater than the 0.6% level of inflation. The move was applauded by the US Direct Marketing Association (DMA) and the Affordable Mail Alliance. Lawrence Kimmel, DMA CEO, described the decision a “a great victory for businesses and consumers”. He added: “The knowledge that postage rates will not rise faster than inflation is also an important element for the business community already operating in an extremely challenging business environment.” In agreement, Tony Conway, Affordable Mail Alliance spokesperson and executive director of the Alliance of Nonprofit Mailers, said: “The PRC today has helped countless businesses stay competitive and saved tens of thousands of jobs. The Commissioners recognised that imposing an additional tax on Postal Service customers is not the way to address its financial troubles. Our members look forward to working with the Postal Service on the long-term restructuring needed to restore the Postal Service to competitiveness.”

There was better news for Royal Mail this week, after it was saved from paying out £37.2m in compensation to mailers who suffered from a drop in business due to UK postal strikes during 2009-10. UK regulator Postcomm announced that it had accepted in full Royal Mail’s application for relief from the financial impact of failure to meet quality of service targets. Royal Mail had applied for relief from such compensation in February, with Postcomm examining the case since July. Upon giving the ruling, the regulator said that the interests of mail users are best served by accepting Royal Mail’s application and supporting the ongoing transformation of Royal Mail’s business. A spokesman from Postcomm said: “This process of transformation has been identified by Royal Mail, Postcomm, the Hooper Review and Government as essential and urgent to safeguard the provision of the universal service in the UK. However the news was not well received across the board. Alan Halfacre, chairman of the Mail Users’ Association, an independent body concerned with commercially operated postal matters, said that Postcomm should take a more “robust approach” to Royal Mail. He told Post&Parcel: “It is difficult to see how Postcomm has acted in a fully transparent manner.”

Staying in Europe now, and President and CEO of Posten Norden Lars G. Nordström has left the company to be succeeded by Lars Idermark. Nordström has been at the helm since the company’s formation in 2009, and was previously CEO at Swedish Posten, where he was in charge of overseeing the company’s merger with Post Danmark. Group chairman Fritz H. Schur said that Nordström was “stepping down in complete accordance with our previous agreement”. New man, Idemark, who will take up his new position at the turn of the year, is currently CEO of the Swedish Cooperative Union (KF). He has previously served as CEO of the Second Swedish National Pension Fund, deputy group CEO of the Capio healthcare group, and deputy CEO of Föreningssparbanken (Cooperative Savings Bank) and Föreningsbanken (Cooperative Bank). On his new president and CEO, Schur said: “With Lars Idermark, we have succeeded in recruiting a person who possesses the optimal experience and background to lead Posten Norden. Idermark has a genuine business and financial background, with experience from social sectors. This background, combined with his drive and focus on results, gives him the ideal qualities to lead Posten Norden.”

And finally…

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