Royal Mail may be in trouble, but it's not doomed yet

[TrueBlueTerrier]

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A couple of weeks ago I pointed out that Royal Mail Group (RMG) shareholders are fortunate enough to be sitting on a whopping property portfolio.

I ventured the opinion that Royal Mail’s business might be best seen as a property company – one with a dwindling mail service attached.

Unfortunately, rather than refocusing the business, management is insisting on putting mail delivery first at all costs.

And unwelcome news out this week confirms that a second and very dangerous front has now opened up in Royal Mail’s battle lines.

It’s barking up the wrong tree here

RMG is to launch a new service – 3D digital printing, for small businesses and punters alike.

The idea is that it’s too expensive for small business and individuals to own a complex 3D printer. So instead, you send your digital file to RMG. They’ll print (essentially, model) it and post your plastic thingummybob straight back to you.

Right, so let’s set aside, for a moment, the fact that any number of small businesses already offer this service (and that they don’t have to deal with RMG’s awful delivery systems). Is this really the sort of thing that Royal Mail’s management should be wasting its efforts on?

RMG’s aim, as the Telegraph puts it, is to: “look for new areas that dovetail with its current business.”

Oh my! I bet they’ve got a committee looking into fresh ideas for expansion. No, actually, worse than that, they’re probably shelling out millions in dreaded consultancy fees for other people to come up with these ideas. Ideas that ought really be implemented by entrepreneurs in the truly private sector.

Clearly RMG has cash to burn. The proceeds from its property sales, I guess.

You know what this is starting to remind me of? HMV. That was a business that also had cash to burn – and it fought the good fight, too!

How did that all turn out, again?

[houseoflords]

I want a 3D image of Moya so I can throw Darts at it...

[freelunch]

moneyweek full of sh1t much?

RM's property folio is only one part of the asset mix making other plc's envious, but once it's gone it's gone!

And why shouldn't RM look to new ventures? damned if they do, damned if they don't it would seem.

No mention of the fact fuel prices greatly affect RM's operating costs - and recent plunges in world oil prices will have a beneficial influence to RM's bottom line in the near future.

[TrueBlueTerrier]

One article I didn't post came up today on another website - basically celebrating that loss of the USO (and therefore Job losses) helped the share price go up yesterday.