TNT Post wins contract for Emap magazine deliveries

[NEWS]

LONDON - Royal Mail rival TNT Post has picked up the £1.6m contract to deliver subscription copies of all Emap's magazines, including Heat, Closer, FHM, Grazia, Empire and Max Power.

The win is TNT Post's first in the magazine publishing sector and follows an eight-week trial. As part of the 12-month contract, which takes in consumer, B2B and trade titles, Emap will sign up to TNT Post's Premier service, a two-day service to pre-sort its mail. However, Royal Mail will remain responsible for the final sorting and delivery of magazines to customers' homes. Ian Phillips, Emap's group circulation manager, said: "Subscription copies account for a significant proportion of our copy sales and so our postal partner is an integral part of the service we offer our subscribers.

"It's for this reason that TNT Post's offer on price and service will deliver significant benefits for Emap and its customers. We have also been impressed by the plans that TNT Post have in place for development and expansion of their services in the UK and look forward to taking advantage of these."
Nick Wells, TNT Post's chief executive, said: "We are delighted to have secured Emap as our first customer in the magazine publishing sector. This is a sector we are particularly keen to expand into and look forward to seeing other publishers take advantage of TNT Post's product, service and pricing."
TNT Post's clients include BT, Centrica, Sainsbury's, Next, JD Williams, Lloyds TSB, HBOS and Barclays.
Since the liberalisation of the UK postal market in January 2006, TNT has processed more than 60m letters a month. TNT Post was formerly known as TNT Mail and was established in 2003. It signed a downstream access agreement with Royal Mail in April 2004 and began operations in August of that year.

[BB brother]

Hello News !

Does the term Agent Provocateur mean anything to you !

[kinmad4it]

If there's any way I can demand my magazines being sent through Royal Mail and not a competitor I'll try. Failing that I'll have to cancell my subscriptions and goto the paper shop
I've already started sending any mail I get addressed to me back that's sent through our competitors.

[somerset]

Quote = However Royal mail will be responsible for final delivery. TNT want the contracts let them deliver the final mail I am paid by Royal mail not sub contracted to do someone elses work.

[F0zziebear]

RM has had Mailsort products for ages. A company does pre-sortation and then gives it to RM. Mailsort 120 or 1400 for example. There is very little difference between that and TNT taking someone's contract and doing it.

The difference in revenue approx 4p per item not coming to RM. If RM were able to flex their costs at the collection/processing/distribution end then RM would actually be making a profit on delivering the mail rather than doing it themselves. YUnfortunately RM's pipeline is almost exclusively all fixed cost, so it the pipeline costs the same whether 1 or or millions go through it. There is some flexibility in procesing, but other areas are fixed.

So please open your eyes a little wider and consider the wider context

F0zz on Ice

[dvbuk55]

Quote = However Royal mail will be responsible for final delivery. TNT want the contracts let them deliver the final mail I am paid by Royal mail not sub contracted to do someone elses work.

I don't deliver now but I certainly take umbrage at these so called competitors offering a service they don't provide! They must sell the product on price alone and their customers are safe in the knowledge that it is actually Royal Mail Posties that deliver the goods. It is a travesty that Postcom and this Government have been able to sell us down the river - doesn't anyone else in the business world think that it is wrong?

[stevie247]

My eyes are wide open and downstream access no matter how you look at it is causing major losses in revenue.I am all for competition but let's have a level playing field not a FIXED ONE.

[DirtyHarry]

My eyes are wide open and downstream access no matter how you look at it is causing major losses in revenue.I am all for competition but let's have a level playing field not a FIXED ONE.

There can never be a level playing field, stevie. Companies like TNT Post, have not the infrastructure to take on Royal Mail, it would be like David
taking on Goliath. Errrm, no , it'd be much worse in fact, it'd be like me donning a suit of armour, girding my sword, stepping out my backdoor into
the garden, and commencing to do battle with the tiniest worm I could hunt down.

[F0zziebear]

1. If you don't believe in postal competition then having competitors is pointless
2. If you believe that the postal industry is entitled to be in realms of the private sector now that most communication takes place via alternative means, then it is impossible under current circumstances to setup a rival national E2E postal company. Regardless of how big you are the investment just does not justify the costs.

The myth that the competition are making huge profits needs to be mispelled. They are, I have personally seen the accounts of most of the competitors. The big customers, i.e banks, telco's, supermarkets are the beneficiaries. They are now spending less per item on their post than in the past. They demand 99% of their mail reaching the royal mail system on time prior to RM delivering it.

Personally I believe that you are having a go at the wrong people. The greedy big customers have driven competition, and not in general rival postal operators. The government have also attempted to create competition, and probably secretly want to privatise the postal industry just like the gas, and telecomms industries.

I know for a fact that the big 3 competitors TNT, DHL and UK Mail are offering little, none and even possibly negetive margins to win contracts. Essentially there is now less money in the postal industry pot being shared amongst more people, something has to give. What that is, is the question.

Two things that need to happen to satisfy stakeholders:

1. Postcomm need to work out a way for competition to be able to offer alternative E2E collection & delivery
2. RM need to charge more to bridge some of the revneue gap, this will allow RM to offer an improved pay offer, but need to be allowed by the union to cut more frontline roles, simply the pay & condiitons strucutre, and therefore remoce more of their support service such as payroll.

RM need to be allowed by all invovled to update their infrastructure as Deutschepost did in the 1990s (though not under liberalisation). This will allow them to be more competitive. This will mean about 30-40% of the mail centres closing, and relocation of processing centres to transport hubs, and not currently where they are, which is urban, close to railway stations.

As with other privatised industries I expect this one to go through a similar path. Many customers left BT & British Gas, but numerous one's came back because of an improved customer experience. If you let the other postal companies deliver mail they won't be able to match RM's quality of service and RM will probably start to win back contracts.

WOnder what ppl think

F0zz 'n' chips luv