POL: PAY 2010 & 2011 AND FUTURE OF THE CROWN OFFICE NETWORK

[The BFO]

There needs to be a National Audit Office enquiry into the method of cost allocation
used by POL to attribute Cost of Sales to products.

If the true/revised cost of products were known then sales promotions could target
the more profitable items. It could be that Crown Office losses are in fact attributable
to unacceptable POL infrastructure operating costs.

Very interesting - you seem to have some knowledge in this area. Are you able to tell us more?

[obiwanknobe]

As an example, although RM, POL and Crowns are all the same company, there needs to an internal attribution of costs incurred. So RM sells a stamp to POL for a profit not a loss, and POL sell this stamp to the Crowns again for a profit and of course Crowns sell stamps to Joe Public for a profit.

We know that a 2nd Class Stamp is 32p to Joe and we can assume that POL are not paying more than business customers pay for their franking M/cs which is 25p (could be less). So there is 7p profit to be assigned somewhere. POL have overheads just as crown offices do so of course there must be a split, but that split is contentious.

Attribute less to a crown then POL make a profit and Crwon make a loss. Pay less to POL then vice versa. The problem is that if POL make a profit attributable to them then the managerial staff no doubt attract bonuses. And of course it is those very managers who attribute the costs.

Simples

[The BFO]

Thank you, that’s very kind. Do you have a view on this, posted by me on 27 September 2010? This anomaly has existed for many years.

'Today I sold €110 to a customer at a cost to them of £100.92.Had my next customer been selling me €110, I would have given them £84.62 – the margin on the two transactions would therefore have been £16.30. My branch would have been credited with Income of £1.38, a difference of nearly £15. Given the large volume of Travel Money business transacted through my offices, if I were the Head of Crown Offices I would be asking questions about this disparity.'

[jusmasel]

If I were head of crowns I wouldn't be making any disparaging noises against the people that pay me!

So how do you find out??

[rwbarker]

Thank you, that’s very kind. Do you have a view on this, posted by me on 27 September 2010? This anomaly has existed for many years.

'Today I sold €110 to a customer at a cost to them of £100.92.Had my next customer been selling me €110, I would have given them £84.62 – the margin on the two transactions would therefore have been £16.30. My branch would have been credited with Income of £1.38, a difference of nearly £15. Given the large volume of Travel Money business transacted through my offices, if I were the Head of Crown Offices I would be asking questions about this disparity.'

What you have to remember is that Firstrate is a joint venture between POL and Bank of Ireland. So, any profit made on foreign currency business is distributed at the end of the year 50 : 50 between the two companies. The Crown network gets it's share based on the percentage of total travel money business which the 370 branches transact......and still we lose money!

[POSTMAN]

Seems to me the BOI get 50% for doing feck all.
Who brokered that deal!

[subbie]

Hi Richard

Your words
<<<The Crown network gets it's share based on the percentage of total travel money business which the 370 branches transact......and still we lose money!<<<<

I take it this is not the case for the Agent Network, as the loss making element is covered by Government subsidy?

So a sensible POL executive given the Crown Office inability to turn a profit on their sales, should cease selling bureau in Crown Offices altogether, and divert as much of the 50% margin that POL makes on sales into the Agents Network, thus incentivising Postmasters to sell even more bureau, because their commission would be higher, and the rate to the customer could be better as well.

Why does the business pump its precious resource into a part of the Network that loses you money?

Subbie

[onlyanother30years]

Couldn't agree more Mr Subbie

[BELIAL]

Why does the business pump its precious resource into a part of the Network that loses you money?

Subbie

Because 10 years ago , the Co-Op bank were deemed too ethical and too RISK averse to be suitable partners :left:Likewise ,ethical ,practical/as it turns out,insurance products were rejected as being profit light

[billyhayes]

Why does the business pump its precious resource into a part of the Network that loses you money?

To make sure that the footfall doesn't go to a competitor.

The bureau's in the 'flagship' offices have a turnover of between 25 to 40k a DAY during holiday peaks, with around 10 to 15k on any other day.

By all means take it away from the crowns, but they will just go 2 doors away to Thomas Cook et al, or buy it online, with better rates from the web.

...thus incentivising Postmasters to sell even more bureau, because their commission would be higher.

The 'incentive' you need is standing right in front of you. Give them what they ask for.
The amount of customers we get saying "Have you got Euros/US dollars? My local won't hold them."

...and the rate to the customer could be better as well.

The rates across ALL bureau's almost everywhere are on their arse...

They are what they are 'cos the world has flushed itself down the toilet.

The only people who CAN afford 'better' rates, bar the internet, is M&S as they are the best at playing the 'loss leader' game on forex than anyone else.

[The BFO]

I remain unclear. In the example I gave the Margin was £16.30. I don’t know what costs are ducted from that, but let’s say for simplicity it is £6.30. £10 profit, £5 for Post Office Ltd, and £5 for the Bank of Ireland. So of the £5 share why does the Branch only receive an ‘Income’ credit of £1.38? It may not seem a lot, and I obviously don’t have access to the data, but when one considers the amount of business transacted in Crown Offices, it seems to me that something doesn’t quite ring true.

[goggins69]

My office is one of 25 I believe with enhanced euro and dollar rates until the end of March. Tesco still beat us yesterday. Our manager took charge of the deal of the day poster and put the dollar rate down for euros!

[billyhayes]

Our manager took charge of the deal of the day poster and put the dollar rate down for euros!

Wow. That 2.25% payrise was well deserved

[billyhayes]

Why does the business pump its precious resource into a part of the Network that loses you money?

Hi subbie, only me. Serious question. We know where you stand on the staff pay dispute but just wondered what you thought about the management pay deal.

2.25% which takes them to approx £30,000 odd. Remember, we are being compared against minimum wage WHSmith staff, therefore for clarity, speaking to a WHSmith manager, they told me they are paid around £18,000...

What say you?

[subbie]

Hi Billy

Just to correct an earlier posting of yours, Subbies are dying to be able to sell ALL Pol products, so the fact that we cannot sell all kinds of bureau is down to POL not us. Did you know we cannot even stock a Passport form unless we are a check and send office!!!!!

This leads me to your last question, the Management and pay, the above stance has come from Management, so NO they do not deserve the rise that they have been given.

This is why Subbies want to Mutualise POL, so that we can stop the stupid decisions that the Management have made over the years. As far as I can see the Management are spending all the dosh before (we) the great unwashed take over.

Sadly the future for the Crown Network is over and whoever was to have control over POL would come to the same conclusion. You guys have been priced out of the market. And to some extent this goes for some types of Sub Office according to POL, as they appear to have embarked on a conversion program to change many Subs into something called a "Local"

Subbie