Consignia dismisses low-cost rival claims

Consignia has described reports that it is planning to launch a cut-price subsidiary service in competition with Royal Mail as ‘speculation’.
A Consignia spokesperson said: “We are not prepared to comment on what is nothing more than speculation.”
But Richard Dykes, group managing director of mail services at Consignia has admitted that Consignia needs to behave more commercially in order to survive in a deregulated market.
Dykes was speaking at the first UK Mail Summit last month during which Consignia came under attack for poor quality of service and its recent application for a price rise.
Dykes said he agreed with much of the criticisms. “We have to adopt commercial behaviour over time and we’ve failed to persuade our people of this. If we don’t, we’ll find ourselves operating at the fag end of the Universal Service”
At issue was what constitutes the Universal Service. Getting rid of a daily second delivery would release cost, Dykes said, and he called for “a radical review” of Consignia’s specifications and cost base by regulator Postcomm. Ultimately mail volumes would decline because of e-substitution predicted Dykes. David Robottom, director of development at the DMA, agreed, saying new DMA members were “by-passing direct mail and developing very targeted campaigns using massive email databases.”