Rival postal operators eat into Royal Mail profits

Post by **TrueBlueTerrier** » 27 Aug 2007, 16:10

http://www.precisionmarketing.co.uk/Art ... ofits.html

Source: Precision Marketing Magazine
ByLine: Jenny Hoffbrand
Publication date: 27 Aug 2007

When Royal Mail blamed its first operating loss in six years on increased competition, eyebrows were raised across the industry.

But new figures from Postcomm reveal that the 15 alternative licenced postal operators are clawing their way deeper into Royal Mail territory.

End-to-end delivery is still largely unfeasible for most of the newer service providers, with only 1 per cent of mail currently not handled by Royal Mail. However, according to Postcomm's latest figures, access volumes have gone from 2.4 billion items at the end of the last financial year, to 4 billion between April and August. This now accounts for one in five items of business mail.

And with Â£700m a year being earmarked for Royal Mail's troubled pension scheme, and the fact that bulk business volumes are down 12 per cent, Royal Mail's predicament starts to look pretty sticky.

But not all Royal Mail customers are willing to lend a sympathetic ear. Stephen Bentley, chief executive of response management and fulfillment house Granby Marketing Services, believes that Royal Mail's troubles are due to a failure to keep costs under control. He is nervous the only way for Royal Mail to recover financially will be to increase prices.

"It's a bitter pill to swallow when you're having to pay for someone else's inefficiencies," he says. "Royal Mail can't blame the changing market. It's down to poor practices and, quite simply, it has to tackle it."

However Paul Budd, external relations director at Royal Mail, claims the organisation has made significant improvements in efficiency and quality. He believes the tight regulations governing Royal Mail's operations mean that it doesn't have the flexibility that its competitors enjoy.

"We've lost Â£44m this year on access mail that we're handling on behalf of competitors," says Budd. "The reality is that we are subsidising their businesses."

But other parts of the business are looking up. In the first half of last year the regulatory report figures show that Royal Mail made a profit on first class mail, including franked mail.

Andy Fruin, external relations director at Postwatch, does not believe Royal Mail's future is terminal. He concludes/ "Royal Mail has gone through a dramatic recovery before, and it will become a healthy company again."

jafferpants · Post by **jafferpants** » 27 Aug 2007, 17:25

IM SICK TO DEATH OF PEOPLE WHINGING ABOUT THE LOSSES WE'VE MADE. AT THE RISK OF SOUNDING LIKE A PARROTT DONT WHING WHEN APP-Â£40 MILLION WAS PAID TO MANAGER'S IN BONUSE'S, AND WHILE I'M AT IT HOW MUCH WAS THE TOTAL SPEND ON INSTALING PLASMA TVs IN EVERY OFFICE SO THAT PINKY & PERKY CAN SPOUT THIER DRIVAL TO ANYONE GAUMLESS ENOUGH TO BELIEVE IT. NOT TO MENTION THE RADIO'S AND TANOY SYSTEM'S BEING PUT IN NO DOUBT SO THAT RM CAN HAVE THIER OWN VERSION OF THE PEOPLE'S STATE RADIO OF CHINA AND WE CAN LISTEN TO THE THOUGH'T'S OF CHAIRMAN "TWAT". WHEN WILL THE NUMPTY'S OF THIS WORLD REALISE THAT RM IS BEING RUN BY PEOPLE WHO SHOULD BE IN A HOME FOR THE TERMINALY STUPID. EG-- GET RID OF A HANDFULL OF DUTY'S ON E V R AND THEN PAY PEOPLE SA TO COVER THEM. THAT MY FRIEND'S IS THE ECONOMIC'S OF THE MAD HOUSE AND WHAT REALLY PISSE'S ME OFF IS NO MATTER WHAT HAPPENS IT ALWAYS SEEM'S TO BE OUR FAULT. BEFORE YOU LECTURE US ON THE FINACIAL STATE OF THE COMPANY GET YOUR OWN HOUSE IN ORDER YOU BUNCH OF RADISHE'S.

Post by **TrueBlueTerrier** » 27 Aug 2007, 17:28

jafferpants wrote:IM SICK TO DEATH OF PEOPLE WHINGING ABOUT THE LOSSES WE'VE MADE. AT THE RISK OF SOUNDING LIKE A PARROTT DONT WHING WHEN APP-Â£40 MILLION WAS PAID TO MANAGER'S IN BONUSE'S, AND WHILE I'M AT IT HOW MUCH WAS THE TOTAL SPEND ON INSTALING PLASMA TVs IN EVERY OFFICE SO THAT PINKY & PERKY CAN SPOUT THIER DRIVAL TO ANYONE GAUMLESS ENOUGH TO BELIEVE IT. NOT TO MENTION THE RADIO'S AND TANOY SYSTEM'S BEING PUT IN NO DOUBT SO THAT RM CAN HAVE THIER OWN VERSION OF THE PEOPLE'S STATE RADIO OF CHINA AND WE CAN LISTEN TO THE THOUGH'T'S OF CHAIRMAN "TWAT". WHEN WILL THE NUMPTY'S OF THIS WORLD REALISE THAT RM IS BEING RUN BY PEOPLE WHO SHOULD BE IN A HOME FOR THE TERMINALY STUPID. EG-- GET RID OF A HANDFULL OF DUTY'S ON E V R AND THEN PAY PEOPLE SA TO COVER THEM. THAT MY FRIEND'S IS THE ECONOMIC'S OF THE MAD HOUSE AND WHAT REALLY PISSE'S ME OFF IS NO MATTER WHAT HAPPENS IT ALWAYS SEEM'S TO BE OUR FAULT. BEFORE YOU LECTURE US ON THE FINACIAL STATE OF THE COMPANY GET YOUR OWN HOUSE IN ORDER YOU BUNCH OF RADISHE'S.

johno47 · Post by **johno47** » 27 Aug 2007, 20:35

The profit figures are just a smokescreen, by Leighton and Crozier, remember when they took over after the first year in charge after a few years of making a loss, we made 3 million profit, and what did those two numbnuts do, they gave 1 million to the London bid for the Olympics, im sorry but you just dont do that if the company is in such financial difficulty...UNITY IS STRENGTH.

jmlr1971 · Post by **jmlr1971** » 27 Aug 2007, 21:13

7oomillion to fund the pension gap! whos f8kn fault is that ?!!!!!! :cfo :lfo

DGP1 · Post by **DGP1** » 27 Aug 2007, 21:17

"It's a bitter pill to swallow when you're having to pay for someone else's inefficiencies," he says. "Royal Mail can't blame the changing market. It's down to poor practices and, quite simply, it has to tackle it."

In this country the word efficiency is used to mean cheaper not what it should mean :

a. The quality or property of being efficient.
b. The degree to which this quality is exercised: The program was implemented with great efficiency and speed

Big Daz · Post by **Big Daz** » 28 Aug 2007, 04:38

jmlr1971 wrote:7oomillion to fund the pension gap! whos f8kn fault is that ?!!!!!! :cfo :lfo

According to the pensions update RM send out every now and then it was only the old poss (section A and B of the current pension plan) scheme that a payment holiday was taken from and the blame was laid on the laws/rules of the day. Apparently RM would have been fined if the pension fund had got too big in funds/value. POPS (section c of the current pension plan) no payment holiday was ever taken from this pension scheme. As a lot of you will know and if memory serves me correctly POSS and POPS are now a single scheme, so does that mean section C subsidises section A and B?

Post by **barkersboy** » 28 Aug 2007, 10:43

So many experts commenting on RM. As far as I know not one of the experts works with or for RM. Perhaps they should have open minds and investigate the truth. The government (postcom in disguise) have an agenda and use postcomm to run the business. Leighton and Crozier are the hatchet men. The 'experts' and the media should take note of what we the workers are saying. We see, on a day to day basis, the demise of RM through bad management and poor planning. In our mail centre massive job cuts are about to take place. When management are asked how they intend to plug gaps they say they will cover with casual workers. Casual workers do not have the commitment or expertise to pull RM through these bad times.

jafferpants · Post by **jafferpants** » 28 Aug 2007, 16:16

bigdaz AS IV'E SAID ON ANOTHER LINK THE OLD SCHEME WAS MERGED WITH THE NEW SCHEME TO COVER UP A SHORTFALL IN THE NEW SCHEME, EVEN THOUGH THIER ACTUARY'S HAD TOLD THEM NOT TO DO IT, AND THAT WAS AFTER RM PAID THEM OVER Â£1,000,000. TO LOOK INTO IT. THEN PROCEEDED TO IGNORE THEM.LIKE I KEEP SAYING THIER ALL f***ing MAD AS MARCH HARE'S AND IF IT WASN'T OUR FUTURE THAT WAS AT STAKE IT WOULD BR ALMOST FUNNY.