UK catalogue bosses warn of PIP ‘Black Monday’

Catalogue chiefs are warning the industry that it faces ‘Black Monday’ following Postcomm’s decision to allow Royal Mail to introduce pricing in proportion (PIP) in a year’s time (PM last week).

Mail order bosses plan to postpone their August 2006 campaigns until after the scheme’s inception in September, as PIP is expected to reduce costs by 60 per cent.

But Nigel Swabey, chairman of mail order firm First Resources, claims Royal Mail will not be able to cope with the resulting deluge of deliveries. He is calling for Postcomm to allow the postal operator flexibility with catalogue deliveries, to prevent chaos.

Swabey, founder and board member of trade body Catalogue Exchange, says: “Everyone in the industry is already talking about September 4, 2006 as Black Monday.

“The smart move would have been to phase in the new pricing in July. The timing is wrong by four or five weeks.

“With PIP, we’ll be increasing our mailings by about 50 per cent, from roughly 4 to 6 million pieces. In addition, after September 4 we’ll send the 3 million we would have sent in August.”

A Royal Mail spokesman comments: “We are used to dealing with greater volumes – Christmas being a prime example. Catalogue senders can rest assured that PIP will have a limited impact.”

Postcomm was unavailable for comment as Precision Marketing went to press.