Is the decline real ?

[tramssirhc]

For years we have heard the losing a million a day story, mail is in fatal decline, USO is unsustainable and now we have Union Leadership telling us accept the changes or else!!!

It may well be true but how ? It seems most Posties across the UK have unsustainable rounds, parcels are always “through the roof” and mail always seems plentiful at least where we are. Maybe not Ist class but the amount of other mail i deliver daily always seems to stay pretty level. Before Covid my van share partner used to complain daily if parcels where 50 a day and we ended up leaving stuff. Now the same duties are separate vans as daily we take out between 120 to 200 parcels each. (Partner has since left).

The point is how does a company that has seen parcels quadruple , mass amounts of new builds go up across the Nation adding hundreds of thousands of new delivery points along with customers collects etc still be declining? And why are those that work the hardest expected to kill themselves even more for what’s really a wage cut ?( not those roles that go for nature walks u see on the Robin app all backpatting each other)

Seems the Union have decided its us who need to save the company but maybe someone can explain why we all need to have 3-4 managers in an office of 50 people or why they need to recieve such extortionate bonuses? Why are we always being fed the doomsday scenario? Maybe Martin can explain it.

No it isn't. The CWU is too lazy to come up with anything original or to roll up it's sleeves and do good old fashioned organising fighting back trade unionism.

[postslippete]

When RM was privatised in 2013 and sold off by the government for £3.3 billion we all know that it was massively undervalued. JP Morgan reportedly valued RM at around £10 billion at the time! Kretinsky bought IDS (RM and GLS) for just £3.6 billion last year, so he has effectively bought GLS and got RM thrown in for free. And yes, DK has had board access, internal financial visibility and years of observing the business.

RM has already shown during periods like the pandemic that it can generate huge revenues when parcel volumes explode and mail gets delivered as and when. The frustration for many of us though is that ever since privatisation, those profits have mainly gone towards shareholder payouts, management bonuses, consultants, restructures and obviously the billions that have been spent on automation and parcel infrastructure.

No one is against the company investing heavily if parcels and reduced mail deliveries are where the profits are, but there are never any cast-iron guarantees that the people on the shop floor will benefit from any of it. And that, for me, is where the CWU leadership are letting their members down because they are just peddling the company's narrative that the business is barely breaking even and that we must work even harder to save the company.

The message that Martin is putting out is all wrong. He is basically saying that unless members accept these changes, the owners will eventually turn RM into a gig-economy operation within a few years. But surely that's exactly why members expect strong union leadership in the first place?? To prevent that from happening - not to repeatedly tell the workforce to accept more changes because there is "no alternative". If RM ever does end up drifting towards a gig-economy model then it will be because the CWU leadership have failed to draw a line in the sand long before it reached that point.

[steve1873]

The decline in letters is clearly noticeable. However the increase in parcels surely must easily subsidise that decline.

When our last revision was done at end of 2021 we did an exercise counting oversized parcels over a 1 or 2 week period. I believe I was averaging around 12-15 per day. Now if I have less than 40 I am having a good day. Smaller parcels have also seen a similar increase. So I'd probably estimate parcels have increased 400-500% percent over a period of less than 5 years.

[clashcityrocker]

The decline in letters is clearly noticeable. However the increase in parcels surely must easily subsidise that decline.

Why?
If your pricing is having to compete with people who can undercut you by using a different employment model, how does increased volume translate into profit?

[Mr Rush]

The decline in letters is clearly noticeable. However the increase in parcels surely must easily subsidise that decline.

Why?
If your pricing is having to compete with people who can undercut you by using a different employment model, how does increased volume translate into profit?

The poster you're quoting never said anything about net profit, just mitigating the losses.

BTW, here's a tidbit from the 2021/22 annual report (p68)...

Parcels revenue represented 56% of total Royal Mail revenue, compared with 59% in the prior year, driven by the recovery of letter revenue in the year.

Letters aren't nothing, they're still a significant source of revenue. Even if we went Denmark and larped as Parcelforce 2, I guarantee you this company would still lose £100m a year because the razor thin margins on parcels are entirely because of staff pay and conditions.

This is the inevitability that we've finally reached after a decade of valiant stalling: is it easier to wreck all the other couriers' grand profits by making them proper employers to obtain a level playing field, or is it easier to wreck RM alone and this job in order to make RM profitable?

[scotchy1962]

The decline in letters is clearly noticeable. However the increase in parcels surely must easily subsidise that decline.

Why?
If your pricing is having to compete with people who can undercut you by using a different employment model, how does increased volume translate into profit?

Herein lies the problem, but there is a solution.
Don't try to compete with them.
Sounds bad but hear me out.
How about using the fact that you've been around for hundreds of years and deliver to everywhere in the country to your advantage.
Instead of trying to get rid of the USO how about asking the government for a level playing field for all.
Stop letting all these companies piggy backing the network to their advantage.
I think if the government stopped this they would get themselves into a position that in the long run would sustain mail, parcels and ultimately all your jobs, but then again what do i know.

[Splappy_McSplap]

The best strategy is to ask the public whether they want their parcel delivered up a tree in someone else's garden in the rain, or handed to them by someone whose first name they have known for years.

[TopperGas]

The best strategy is to ask the public whether they want their parcel delivered up a tree in someone else's garden in the rain, or handed to them by someone whose first name they have known for years.

The problem is they only want to pay what the first option charges? Although why has this issue only now raised it's head as I can't recall it ever being considered a major issue pre DK?

[postslippete]

Gig-economy competitors undercutting RM on labour costs only tell half the story

Management constantly tells us to prioritise the Tracked because that is supposedly "where the money is". Parcel volumes overall have exploded and everybody on the shop floor feels increasingly overworked. So if volumes, prices and workloads are all increasing - where exactly is the money going?

For years, it was the decline in letters and the USO that was (and still is) seen to be RM's main issue. Now, it's low margins on parcels and gig-economy competition. Low margins doesn't mean no profit. Even supermarkets operate on low margins but their huge scale still generates profits. RM's advantage is its nationwide infrastructure and network which allows them to deliver Tracked, letters, Specials and even D2Ds which are still all revenue streams that our competitors aren't doing. And while RM are keen to point out that letter volumes has declined, stamp prises have also risen sharply at the same time.

At some point you have to ask whether RM's problem is the employment model or if it's something else. There never seems to be any real scrutiny directed towards years of poor management decisions, shareholder payouts, bonuses, consultants and operational inefficiencies.

[Mr Rush]

Management constantly tells us to prioritise the Tracked because that is supposedly "where the money is".

When Tracked was still mostly the domain of retailers, a decade ago and more, those were the big contracts RM was winning. That's why Tracked came into existence nineteen years ago and why PCOD was introduced (before it became default). They, in theory, are where the money is... although in practice a competitive parcel market creates a constant downward pressure on prices. So Asos will bounce from us back to Evri because they're cheaper until cheapness results in too many delivery complaints and they come back to RM for a pricematched 'reliable' service until they want to save money again... and round and round it goes till every service has been equally dragged down into the gutter.

Now, of course, 95% of packets are Tracked and the tiny stuff at the bottom of the york with the badly printed holy 't' on it is probably more of a loss maker than the letters but like free parcel collections, it's more about denying the competition the traffic in the hope of capturing enough of the market to then jack up the prices.

[SpacePhoenix]

Management constantly tells us to prioritise the Tracked because that is supposedly "where the money is".

When Tracked was still mostly the domain of retailers, a decade ago and more, those were the big contracts RM was winning. That's why Tracked came into existence nineteen years ago and why PCOD was introduced (before it became default). They, in theory, are where the money is... although in practice a competitive parcel market creates a constant downward pressure on prices. So Asos will bounce from us back to Evri because they're cheaper until cheapness results in too many delivery complaints and they come back to RM for a pricematched 'reliable' service until they want to save money again... and round and round it goes till every service has been equally dragged down into the gutter.

Now, of course, 95% of packets are Tracked and the tiny stuff at the bottom of the york with the badly printed holy 't' on it is probably more of a loss maker than the letters but like free parcel collections, it's more about denying the competition the traffic in the hope of capturing enough of the market to then jack up the prices.

Over time it looks like more and more letters and flats will be Tracked.