Norway Post brings thickness into pricing of letters

Norway Post has changed the pricing structure of its letters delivery services to reflect the thickness of items as well as weight. Effective from the start of this month, the national postal operator has implemented a new system classifying prices for letters in three categories of thickness.

Postage for items less than two centimetres thick starts at NOK 9.50 ($1.56 USD) for the domestic one-day first class (A-Priority) service, NOK 9 ($1.48 USD) for the three-day domestic second class (B-Economy) service for up to 20g in weight.

Items between two and seven centimetres thick have postal rates starting at NOK 28 ($4.62 USD) for first class and NOK 26 ($4.29 USD) for second class in the 20g category.

The third category, for items above seven centimetres thick, starts at NOK 48 ($7.93USD) for first class and NOK 45.50 ($7.51 USD) for second class items up to 20g.

Posten Norge said the change in pricing structure more accurately reflected the higher costs it faces in delivering thicker letters. Under the terms of its license, the Post is required to gear its letter prices to the costs involved.

“Necessary”

“The Post Office sets prices based on costs, and it costs more to distribute the thick mailings than thin letters,” said mail division executive vice president Tore K Nilsen.

“We see that some customers will have higher postage costs due to the new pricing structure. The changes, however, are necessary to maintain current service and profitability, while the Post must comply with its obligations to price based on cost.”

First and second class letter volumes are declining year-on-year by 7% at Norway Post at the moment, with advertising mail volumes declining by 2%.

The Post said the trend was expected to continue, but that its efforts to improve service efficiency were keeping up with the loss of income from its letters services.

Norway Post has made NOK 2.3bn ($380m) in cost savings since 2008.

The company is pushing the government to allow it to eliminate Saturday deliveries to help further cut costs from its delivery services.