Tag: UK

Postwatch concerned about zonal pricing: who wins?

Posted by | Apr 2, 2007 | |

The postal regulator Postcomm has today started to consult on Royal Mail’s application to price its bulk mail products differently according to where they are delivered. The Royal Mail wants to divide the UK into 4 zones according to the density of delivery points and in addition London where it claims costs are higher.

Postwatch, the watchdog for postal services, will be studying the proposals carefully before responding on behalf of customers. Clearly the implications of introducing zonal pricing need to be fully worked through and fully understood before being allowed.

Postwatch is concerned that there is a real risk bulk mailers will curtail mailing to rural areas and all or parts of London because those areas will attract a surcharge. Not only could this be detrimental to customers and businesses in those areas but it could also have an irreversible effect on volumes. This is at a time when Royal Mail itself is constantly expressing concerns about the decline in the amount of mail it is delivering.

Millie Banerjee, Chair of Postwatch, said: “We are concerned that this second attempt to persuade the regulator to allow the introduction of zonal pricing will be successful. It may pass the test of allowing specific product prices to be more closely aligned to their costs. But it may also result in an unfortunate lose – lose situation, where customers, competing postal operators and Royal Mail itself are all worse off.

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OMD wins Royal Mail account

Posted by | Apr 2, 2007 | |

OMD UK has won Royal Mail’s GBP 18m media planning and buying following a two-way shoot-out against incumbent Carat. The Omnicom agency will handle all media planning and buying for the Royal Mail for the next four years.

Carat, part of the Aegis network, had held the account for 10 years and was has previously been reported to have retained the account. MediaCom and PHD were knocked out of the pitch at an earlier stage.

Royal Mail has also retained Proximity to handle its direct marketing and added data planning to its responsibilities. Both OMD and Proximity will work with its advertising agency, Abbott Mead Vickers.BBDO.

A review was expected to be called in 2005 but Royal Mail extended Carat’s contract by a year. It then called a statutory review through the Official Journal of the European Union (OJEU) late last year.

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Royal Mail plans London surcharge

Posted by | Apr 1, 2007 | |

Royal Mail is planning to charge businesses more to deliver post in London than in other parts of the country.
According to proposals submitted to industry regulator Postcomm, business mail, including bulk deliveries such as bills, statements, and mailshots, will attract a surcharge if delivered to London and low-density rural areas.

The plans have caused surprise at Postcomm and angered business users because it was assumed delivery to urban centres would be cheaper than to rural areas, where costs were higher.

However, in its application for the introduction of ‘zonal pricing’ on business post, Royal Mail, led by chief executive Adam Crozier, indicates that it wishes to make a surcharge of 2.5 per cent over current prices for delivery in London and 4.8 per cent for ‘low-density’ rural areas. It claims the move will reflect the higher costs of delivery to these areas. Factors including ‘London weighting’ and congestion charging are behind the increases in the capital.
In ‘high-density’ areas other than London, Royal Mail is planning price cuts between 4.9 per cent and 1.7 per cent.

Postcomm is expected to launch a nine-month consultation on the proposals this week, and will examine Royal Mail’s claims regarding London closely.

Businesses and competitors are highly critical of Royal Mail’s plans, fearing the rise in London will significantly increase their bills and that price reductions elsewhere will undercut potential rivals.

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UPN Strengthens the Network

Posted by | Apr 1, 2007 | |

UPN welcomes H & B Logistics to the Network covering the M, SK, OL and BL postcodes.

H & B Logistics was established in 1989 and relocated in 1995 to a 15,000 sq ft distribution centre based in Denton,

Manchester to provide a faster and more efficient service for its customers. The company has a fleet of vehicles ranging from 17 tons vehicles, 7.5 tons vehicles, 35CWT vehicles, tractor units, double deck trailers and single deck trailers.

Since joining UPN, they have already begun to see the benefits of membership with a 20 pct growth in business so far.

H & B Logistics chose to join the UPN network in order to develop their distribution centre further and to provide a valuable extra service to its existing customers by being part of a leading pallet distribution network.

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