Letters and Parcels, Royal Mail warns on competition threat from rivals Options

[Andy Capp]

It didn't take long before the RM started to hint at a desire to shed some of its service offerings: "Royal Mail has warned that competition from rivals could threaten the "fundamental economics" that support its six day a week letters delivery service."

Of course, other delivery businesses are reliant on minimum wage and zero hour contracts, so it won't be long before we lose a service that was once the gold standard.

[Turin Machine]

If they didn't make it so difficult to use them, and if they were more competent they might not be struggling.

[On the edge]

We lost the gold standard service a while back AndyC! When the 'Post Office' was broken up.

I stood in a queue the other day to try and send a recorded letter.....wait for ever. Pre booked passport appointments taking precedence. Some old chap came along to apologise, because they were short staffed. Apparently, he couldn't help because he was the mortgage advisor!

That's their new version of Customer Service presumably. Is it any wonder competition is making inroads? It's not so much lower wages, more slovenly management.

[blackdog]

Service from courier companies etc is hardly superb either - and Post Office Counters is not the Royal Mail - they are different companies these days.

The real issue is that the Royal Mail has to deliver to any address in the UK, 6 days a week, but they are facing competition who can undercut their prices in situations where it is cheaper to deliver. For instance I could start a local post service, sticking up a couple of dozen post boxes around the town and employing a couple of teenagers on mopeds to deliver to any address in Newbury, for half the price of a first class stamp. The Royal Mail would lose some income, I would make a profit on their loss (perhaps).

As far as I can see this situation will always prevail, the only way to make the market truly competitive is to remove the requirement to deliver everywhere 6 days a week at the same price. If Royal Mail could, for instance, only deliver weekly to remote locations, or charge more to deliver post to such locations, then they could reduce prices to compete in the easier markets - eg by introducing a local post rate in towns and cities.

[MontyPython]

Service from courier companies etc is hardly superb either - and Post Office Counters is not the Royal Mail - they are different companies these days.

The real issue is that the Royal Mail has to deliver to any address in the UK, 6 days a week, but they are facing competition who can undercut their prices in situations where it is cheaper to deliver. For instance I could start a local post service, sticking up a couple of dozen post boxes around the town and employing a couple of teenagers on mopeds to deliver to any address in Newbury, for half the price of a first class stamp. The Royal Mail would lose some income, I would make a profit on their loss (perhaps).

As far as I can see this situation will always prevail, the only way to make the market truly competitive is to remove the requirement to deliver everywhere 6 days a week at the same price. If Royal Mail could, for instance, only deliver weekly to remote locations, or charge more to deliver post to such locations, then they could reduce prices to compete in the easier markets - eg by introducing a local post rate in towns and cities.

Scottish independence should reduce the cost then

Perhaps the one price for all should be changed - townsfolk subsidising the countryfolk yet again.

[Berkshirelad]

There is a requirement in law for Royal Mail to offer a universal postal service. If any company were to replace RM, then they would have this obligation.

Delivering deep into the countryside; highlands and islands is not economically viable, but it is a legal duty.

The problem facing RM is that the 'competition' cherry-pick the profitable deliveries and simply pass the non-profitable ones to RM to complete.

[On the edge]

There is a requirement in law for Royal Mail to offer a universal postal service. If any company were to replace RM, then they would have this obligation.

Delivering deep into the countryside; highlands and islands is not economically viable, but it is a legal duty.

The problem facing RM is that the 'competition' cherry-pick the profitable deliveries and simply pass the non-profitable ones to RM to complete.

There is lies the issue! It was a really sensible well thought out privatisation wasn't it!!!! Separating the Counters from the Delivery was sensible as separating the train operators from the tracks. All make sense to the policy wonks at Conservative central office...because their sponsors can smell a nice wadge on the original sale.

The Postal service as such is still very poorly managed, in both its halves. Then, they are doing the same as the bankers, taking huge salaries whilst it lasts, then when it collapses, a nice big pay off!

Yes, the independence of Scotland should make it far cheaper to operate, just that we'll pay the same price to send stuff there as we do for France. Another benefit of a yes vote!

[regor]

I am sticking with RM.

Last time I tried to use a "rival" to send a parcel to Northern Ireland they told me it was not part of the European Union so I would be charged the same as if it was at the far end of Eastern Europe, same price as Belarus.

I retreated back to good old RM

[JeffG]

Last time I tried to use a "rival" to send a parcel to Northern Ireland they told me it was not part of the European Union so I would be charged the same as if it was at the far end of Eastern Europe, same price as Belarus.

How is Northern Ireland not part of the European Union?