Tag: Royal Mail

Business Post steps up pressure on Royal Mail

Posted by | Jul 10, 2007 | |

Business Post, the postal services company, said its turnover had risen 13 per cent in the first quarter of 2007 compared with the same period last year.

In an interim management statement ahead of Tuesday’s annual general meeting, the company said its struggling parcels business was “making progress in an increasingly competitive market” while other parts of the business were performing strongly.

Business Post’s parcels contract with Federal Express, worth about GBP 20m in revenue and GBP 2m in operating profit, was terminated on April 30. If the revenues from this contract were excluded, the company’s underlying revenue increase for the first quarter would have been 18 per cent, the company said.

More than 10 per cent of the 20bn items posted each year in the UK are now handled by private sector contractors. Business Post handles more than one in 20 letters posted in the UK.

Business Post said it had managed to minimize the disruption caused by the Royal Mail strike at the end of June.

The company said when it announced its full year results in May that it had more than doubled revenues of its UK Mail operation in the year to March 31 2007 to GBP 90.3m, following the full opening of the letters market to competition at the start of last year.

In May, the company said its operating profit from UK Mail also doubled from GBP 3.2m to GBP 6.4m after investing a further GBP 4m to increase sorting capacity.

The group’s turnover was GBP 325.6m in the year to March 31, compared with GBP 278.2m the previous year, and profit before tax was GBP 9.8m compared with GBP 4.7m the previous year.

Tuesday’s statement contained no information on the company’s expected profits or dividends.

Business Post now has more than 400 customers, including Prudential, which the company won in June, the BBC and the Department for Work and Pensions.

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Royal Mail faces threat of watchdog censure in battle over prices

Posted by | Jul 9, 2007 | |

Royal Mail is facing action from the postal regulator after a complaint from DX, one of its rivals, that it had breached pricing regulations.

Postcomm is due to make a formal ruling in the next few weeks, but the regulator has already outlined concerns over a new service that operates in DX’s area.

As the dominant incumbent, Royal Mail is not allowed to lower its prices selectively because that impedes emerging competition. Instead, if it lowers prices it has to offer those prices to everyone. DX argued that it had circumvented this by creating a new service and arguing that this served a niche market, rather than a broad one.

Last year Royal Mail was fined GBP 1 million by Postcomm for failing to ensure that it did not gain an unfair commercial advantage over its competitors in the “access to the last mile” market.

The move came after complaints from three of Royal Mail’s competitors at the time – Express, the dairies business, TNT and UK Mail – who said that they had been hampered in getting uniformly priced access to the final-mile delivery, which is carried out by Royal Mail postmen.

Two years ago the regulator found that Royal Mail’s advertising had breached competition regulations.

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Pitney Bowes hails Singapore Post for new meter discount on postage

Posted by | Jul 9, 2007 | |

Pitney Bowes Inc. is praising Singapore Post for the post’s recent implementation of a postage discount for mail that is processed using a postage meter. This move, effective July 1, makes Singapore Post one of a growing number of national posts around the world that are passing lower transaction costs on to customers who use meters.

In announcing its decision, Singapore Post joins Royal Mail (UK), La Poste (France), India Post, An Post (Ireland), Norway Post, Finland Post, Sweden Post and others in offering some form of discount or rebate on some or all segments of metered mail.

These posts have decided to offer discounts because postage meters help them avoid the equivalent of millions of dollars in costs required to design, print, distribute, sell and account for postage stamps. The discount offered to meter users provides an incentive for mailers to switch to the high-tech devices, because postage is usually one of the largest expenses a mailer faces. Switching more mail to postage meters helps mitigate higher postage costs.

Discounts of this kind stimulate efficiency and innovation in the sector, a key objective not just for mailers and posts but also for independent postal regulators around the world.

Pitney Bowes has argued for many years that posts in more nations should implement discounts of this type.

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New Royal Mail strike announced

Posted by | Jul 5, 2007 | |

Royal Mail workers will stage a second 24-hour walkout over pay and jobs, their union has said. The strike will begin at 1900 BST on 12 July and will end the following day, the Communication Workers’ Union said.

Last Friday, the CWU led a similar walkout across the UK – the first national postal strike in a decade.

Workers are angry over plans to restructure the company, though Royal Mail argues it has to change in order to compete with rival firms.

Staff has rejected a 2.5% pay offer and says they are worried that modernization plans will see jobs cut.

Deputy General Secretary of the CWU, Dave Ward, said that the strike could be averted if Royal Mail entered negotiations.

Last week’s post strike was the first national walkout in a decade

Royal Mail and the CWU disagreed over how successful last Friday’s strike had been.

The union dismissed as “nonsense” Royal Mail claims that nationally up to 60% of its staff were working, saying that 95% of staff took part in industrial action.

The CWU has argued that Royal Mail’s plans for modernization will lead to 40,000 job losses.

But Royal Mail has said it needs to change the way it operates after the UK’s postal market was opened up to competition.

And earlier this year, Royal Mail was ditched by the Department for Work and Pensions in favor of UK Mail.

Companies are unhappy at the prospect of disruption to services, and the Federation of Small Businesses has warned that further strikes would put the livelihoods and jobs of many people in small firms “at risk”.

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Post Office boosts Instant Saver rate

Posted by | Jul 5, 2007 | |

The Post Office is increasing the rate on its Instant Saver account from 5.75 per cent to 6.00 per cent* following today’s rise in the Bank of England base rate.

The new rate will be available to new and existing Instant Saver customers from August 1 2007.

Post Office Head of Savings Richard Norman said: “The Post Office® continues to be one of the few savings providers to consistently pass on base rate rises in full to customers, and we guarantee to do so until 2010.”

Post Office Instant Saver also guarantees to remain within 1.0% of the Bank of England base rate for the life of the account and offers six free withdrawals a year with a flat fee of just £1 for future withdrawals.

Instant Saver is available at all of the UK’s 14,000 Post Office branches, by telephone and online. Withdrawals can be made both at branches and ATMs, offering unrivalled choice and convenience.

*This includes a 1.0% bonus for 12 months from the date of account opening.

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