UK Post Office: Life in the old dog yet
The Post Office has been forced to broaden its horizons in recent years. Having branched out of its traditional sector, it now puts as much energy into competing against the likes of Barclays and BT as it does into sorting and delivering mail. Following its expansion into travel and financial services, the Post Office is looking to become a major player in the telecoms sector, launching its own directory enquiries service earlier this month to complement its fixed-line offering Homephone. Post Office head of marketing Simon Carter said last week that further product launches, which could include mobile phone, broadband or voice over internet protocol services, could follow. The Post Office has the largest retail network in Europe with 14,500 branches and 28 million customers a week. But the business is still losing more than GBP100m a year, exacerbated by the fact that pensions and child benefits are now paid directly into bank accounts. In the past, the transactions accounted for 40% of Post Office revenue. Although last week Post Office parent company Royal Mail was handed a record GBP11.7m fine for 14.6 million items that were lost or stolen last year, it is estimated that now just 25% of the Post Office’s business is handling mail. The rest is made up of travel products, government services, financial services and telecoms.
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