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Royal Mail Warns On Lower Parcel Revenue As Competition Bites

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http://uk.reuters.com/article/2014/07/22/uk-royal-mail-results-idUKKBN0FR0HD20140722

Britain's Royal Mail Group said it would have to rely on cost control measures and letters sales to meet full-year expectations after rising competition meant parcels revenue would be lower than anticipated.

The postal operator, sold off to much controversy last October in Britain's biggest privatisation in decades, said on Tuesday group revenue for the three months to June 29 had risen 2 percent, led by a better-than expected performance in its letters arm.

UK letter volumes declined 3 percent but revenues rose by the same amount thanks to price increases, however volumes for UK parcels, a key focus for the firm, grew by just 1 percent and revenue declined by 1 percent.

:lol::lol::lol:

Increase letter sales, at those prices I've stopped sending letters unless I absolutely have to and there is no other alternative.

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I can remember arguing with someone on here that worked for them that they were overpriced for parcels against the competition and the response was always complacency and no-else can offer the same universal service but it's just not true. They've lost massive business from us and presumably many others too.

They really need to be offering a 5kg parcel service nextday tracked for sub £4.

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Parcelswise, they've screwed themselves. I figured it was deliberate actually. The system is too complex for the average punter, and because there's no discretion the occasional sender is likely always left with a bitter taste in their mouths because their parcel is 0.5cm over in one dimension. Any regular sender (eBayer) will have worked out there are better solutions.

The government will end up stepping in to rescue it I reckon (because you can't have the Queen's Mail going bankrupt or similar).

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Getting sick of having to collect and pay for letters that don't have the large letter stamp correct. Bad PR, local postal office closing, parcels will be sent using other services.

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Getting sick of having to collect and pay for letters that don't have the large letter stamp correct. Bad PR, local postal office closing, parcels will be sent using other services.

Our lot just guess if it looks like large letter and never get any come back. They did once bring one enormous mat back because they said it was too big to accept - they delivered the other 900 odd though.

There's a battle between account managers/management and sorting office staff. Whenever our Royal Mail account manager would trawl round our warehouse she'd say why aren't you sending this or that with us and we'd say it's too big or heavy according to your guidelines and she'd say just shove it in. I guess they realise it's better to actually deliver something slightly too big than the business go to a competitor but I think they have a hard time with the sorting office staff.

Also sure the public would get aggro at the post office for various hazardous goods but for business, where a sales person has targets to meet, it's very much 'just shove it in'.

Edited by SNACR

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Parcelswise, they've screwed themselves. I figured it was deliberate actually. The system is too complex for the average punter, and because there's no discretion the occasional sender is likely always left with a bitter taste in their mouths because their parcel is 0.5cm over in one dimension. Any regular sender (eBayer) will have worked out there are better solutions.

The government will end up stepping in to rescue it I reckon (because you can't have the Queen's Mail going bankrupt or similar).

I'm suspicious they're looking for an excuse to ditch staff and then maybe improve the value of their offering once the fat is trimmed.

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I left the UK just before the introduction of these template letterbox gauges that determined if yours was a letter or parcel or whatever. It was slightly cheaper for me to send documents in tubes internationally, than it was domestically, but the rates were still good. The prices are much comparable in France today (compared to the UK six or seven years ago) for lightweight documents sent in tubes. Last year, I had to go to the UK and had a document to send, so brought it with me and went to the post office. What costs me just under two pounds to post with La Poste, costs nearly five pounds with Royal Mail.

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For parcels, I think it’s worse than just pricing. Opening hours and parking.

All of the post offices around here are on the high street with standard opening hours, and queues out the door at lunch time.

All of my >1kg go courier, I can drop them off at a store on my way to work.

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Nearly all of my heavy (10-15Kg) parcels go with UPS who are my favourite courier. They have never lost or damaged anything and have delivered to many parts of the world. The exceptions to this are Russia and the Far East - ParcelForce are very competitive and for Ukraine TNT gave me a good rate.

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a former monopoly (still) losing market share

quelle surprise

Last couple of times I have spoken with our account manager, I have advised her that as soon as there is a 'same price or better' alternative to RM for LL and sub 1kg packets then I will immediately switch all of our volume to the alternative provider to help encourage competition in the marketplace.

She doesn't understand why.

I keep emailing UK Mail, Collect Plus and others offering them our business at Royal Mail prices with a 1% rebate to us at the end of each quarter but, so far, none has accepted.

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Oh dear its going down...new low these last few days of under £4.00...making the offer price of £3.30 absolutely spot on....15-20% premium within the normal range for a float. Guess Cable might be owed an apology from Balls (who in turn demanded an apology from Cable when it was £5.00). You know the guy who wanted an apology from Osborne for being the slowest growing economy in the G7. Basically GDP was everything apparently...well Osborne delivered on pseudo austerity.. Talk about a clueless chump nailing his grievances on the wrong mast...the National debt might have been a better place to start except that he wanted an even bigger one.

Edited by crashmonitor

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Oh dear its going down...new low these last few days of under £4.00...making the offer price of £3.30 absolutely spot on....15-20% premium within the normal range for a float. Guess Cable might be owed an apology from Balls (who in turn demanded an apology from Cable when it was £5.00). You know the guy who wanted an apology from Osborne for being the slowest growing economy in the G7. Basically GDP was everything apparently...well Osborne delivered on pseudo austerity.. Talk about a clueless chump nailing his grievances on the wrong mast...the National debt might have been a better place to start except that he wanted an even bigger one.

The problem was not the price but that Cable gave most of the shares to a bunch of City boys who then proceeded to make a fortune from them - probably selling the shares to pension funds.

The problem was also that Cable restricted Joe Public from buying anything more than a handful of shares because he did not want the shares in the - I think he used the word - the hands of spivs?

Ah, yes he did - "spivs and gamblers" apparently.

http://www.bbc.co.uk/news/uk-politics-11382047

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Problem with RM is it more than likely carries the infra structure and overheads of a public business. Examples of this probably include things like staff on high rates of pay. delivery to uneconomic places and complex expensive to maintain systems and rules.

As working practices change new businesses can come in that don't have these sorts of costs and undercut. Unfortunately most of the cost savings are made through employees, so doing things like zero hours contracts etc. So we all get things delivered more cheaply - but the wages for the delivery person drop through the floor, with the obvious consequences.

I have also noticed that a lot of parcels that are delivered to me from a major online seller are ripped open. I can only assume that they are "inspected" to see whether they contain anything of worth.

My feeling is that standard delivery has changed from a relatively high cost, high reliability to a low cost low reliability business. If you have expensive items, services like Special delivery and other Couriers make a lot more sense.

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For the first time that I recall, in over a decade of membership an Ebay purchase didn't appear in the suggested timescale. It was a small, low value item which fitted in an envelope. I contacted the seller, who very fairly and without question sent a replacement parcel out which arrived in a couple of days. About a month later I get a card through the door saying there is a letter without sufficient postage on it- turns out it was the original package which I'd forgotten about by then. It allegedly breached the 5mm wide rule for a standard stamp, but I'd say it was marginal, especially since the replacement made it without issue with the same postage applied.

Anyway, the thing that made me sad was the time it took to inform me, it was literally several weeks. I expect this is due to some of GPS's observations above- age old systems of working. OK, a stamp is cheap but I dunno if that is really a tenable service standard for customers. I've had documents back from the DVLA quicker than that.

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So we all get things delivered more cheaply - but the wages for the delivery person drop through the floor, with the obvious consequences.

Not all of us, as in all of society. If you live somewhere 'difficult' to get to e.g. on an island, or north of Fort William then the courier charges shoot up.

Royal mail / parcel-force used cross subsidisation to provide a universal service. the profitable bits of the business are being given away, so there is less money to cross subsidise the more expensive bits.

it is all to benefit big business not society.

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The universal service argument is total drivel the numbers of the population adversely affected by its removal is vanishingly small but it's been a convenient excuse for Royal Mails poor service an pricing for too long.

They could have occupied an unassailable position in the online small parcels market and their union is responsible for pissing that opportunity away. I anticipate it being broken up in the not too distant future.

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I think the SP was down today on the parcel service sales being down - Amazon and TNT are eating into their business.

Hermes are taking a lot and when I say a lot really I mean absolutely loads.

Usually at this time of year there's a shortage of post sacks and york roll cage things but at the moment they keep bringing them and seemingly using my premises as some kind of free storage option for their surplus.

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Hermes are taking a lot and when I say a lot really I mean absolutely loads.

Usually at this time of year there's a shortage of post sacks and york roll cage things but at the moment they keep bringing them and seemingly using my premises as some kind of free storage option for their surplus.

i can send a small parcel with myhermes for £2.39 with parcel2go under 1kg

why would anyone still use RM , any parcel over 2.5cm in thickness is ridiculously priced !

pay £3 any hermes will collect from the front door

royal mail business plan is dead , they need to drop their prices

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Guest Jemmy Button

Yup, another great endorsement for Privatisation and for the failed rodent Shareholder economy (shareholders - don't you just hate these pieces of vermin.)

Edited by Jemmy Button

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