First potential competitor to Royal Mail
Hays Business Group, one of Britain’s 100 biggest companies, yesterday emergedas the first serious potential competitor to Royal Mail, the letters arm of Consignia, since the postal market was opened to competition in March.
Hays DX, the group’s document exchange subsidiary, said it had applied to PostComm, the independent postal regulator, for licences to operate at least three new postal businesses competing head on with Royal Mail.
Hays also said it was irritated by the slow pace of progress towards competition in postal services since Royal Mail’s monopoly over letters costing less than Pounds 1 was replaced by a licensing regime.
Keith Maple, Hays DX’s divisional planning director, said the company had applied for a 12-month “pilot” licence to deliver business mail between 27,000 addresses in central areas of London, Manchester and Edinburgh.
Hays would collect mail from businesses that sign up for the service, sort it, and deliver within specified post codes. Prices for overnight delivery have not yet been set, but would be lower than first class mail.
Hays also wants to collect mail from small and medium-sized companies, which would be sorted and passed in bulk to Royal Mail, qualifying for pre-sorting discounts currently available only to big companies.
The company is asking PostComm to force Consignia to accept the mail at its discounted rate, and to allow it to be injected into Royal Mail’s local delivery network, bypassing Consignia’s sorting operation.
Hays, which operates an overnight document exchange service carrying up to 1.25m items a night between law firms, has also sought a licence for a third service, which it says is “innovative and national” but confidential.
David Sibbick, director of regulatory affairs at Hays DX, said the industry was “impatient” about delays in competition. “The government promised us deregulation two years ago, and so far nothing has happened.”
PostComm said it was moving as quickly as possible: “We are as anxious as they are to get competition in as quickly as possible, but we think it is better to move cautiously and get it right.”
Graham Corbett, PostComm’s chairman, has had talks with several potential competitors, including DHL, Federal Express and most of the big European post offices. However, Hays is the first company to confirm it has applied for a licence.
PostComm has a legal obligation to maintain deliveries at the same price in every part of the UK. It is expected to publish a consultation paper later this month, but is not expected to issue permanent licences until next year.
Copyright: The Financial Times Limited
