Competitive Market Review
A detailed assessment of the current competitive situation in the postal market and the barriers to entry.
P:LibraryPostalPostComm Formal DocumentsCompetitive Market Review Sept04.pdf
Tag: Royal Mail
UK Royal Mail calls for competition
Royal Mail’s Chief Executive, Adam Crozier, today encouraged the early opening of the mail market provided the regulations which stop Royal Mail competing are removed. “Customers should have a proper choice. Royal Mail believes the market should be opened faster than originally planned as long as restrictions on Royal Mail are removed,” he said. “I am very confident that Royal Mail’s people can succeed in a competitive market. They are more than capable of delivering high quality service to customers. “But the handcuffs have got to come off. Royal Mail wants to see simple, light-touch regulation allowing the company to make an acceptable rate of return on its turnover. Some of our biggest rivals, including the German and Dutch postal businesses, are making returns of more than 20% compared to Royal Mail’s 2.5% return on its day-to-day operations from the turnover in its letters business in the last financial year.”
Read MoreUK Postcomm competition proposals are recipe for white van man postal chaos say Amicus
Amicus the union representing postal managers, has condemned today’s announcement by postal services regulator Postcomm for the full opening of the postal services market to competition as premature and likely to result in postal chaos. The union which represents 14,000 post office managers will be pressing Postcomm to ensure provision of the universal service at a uniform price and to conduct a full review of the impact and effect of competition introduced earlier this year before any further extension of the postal market. Peter Skyte, Amicus’ National Officer for postal services, said: “Postcomm’s proposals for full opening of the postal market to competition in 2006 are premature, given that there has been insufficient time to make any realistic assessment of the impact of the initial letters market opening introduced only a few months ago. As they stand they will also put at risk the universal postal service in Britain and provide the potential for every white van man to chase postal business without adequate safeguards for security, integrity and sustainability of the public postal service. Postcomm must think again.”
Read MoreUK Royal Mail faces deadline in compensation dispute
Royal Mail has until next month to prove it did not short-change business customers seeking compensation for poor service following a row between the company and some of its biggest clients. Nigel Stapleton, chairman of regulator Postcomm, is investigating Royal Mail’s compensation scheme, which has paid out only half the Pounds 70m that customers expected. Under Royal Mail’s new compensation scheme, the state-owned postal group is obliged to make payments to its domestic and business customers if it misses its quality of service targets. Royal Mail missed all 15 of its targets for the year ending March 31 2004, and said last month that it had so far paid out Pounds 16.5m to domestic customers and Pounds 35m to business customers. But, according to calculations by Postcomm and bodies representing mail users, it should be paying at least Pounds 70m.
Read MorePostcomm proposes a faster route to ending UK Royal Mail’s postal monopoly
Postcomm today launched a consultation on a package of measures designed to bring forward competition in postal services, promote greater efficiency and service quality from Royal Mail and make it easier for competitors to enter the market. The proposals would advance Postcomm’s current timetable for full market opening by 15 months to 1 January 2006, provide Royal Mail with an extra nine months to prepare for full liberalisation by cancelling the interim stage of market opening that had been planned for April 2005, safeguard the continuing provision of a universal service for 1st and 2nd class stamped post at a geographically uniform price and set a framework for Royal Mail’s price and service quality control from April 2006. The proposals will also provide more freedom for Royal Mail to offer new, innovative, services to help it compete in the fully liberalised market and give customers more choices, so they can select a postal supplier that meets their service quality requirements and offers innovative postal products.
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