TNT uses strikes to put pressure on Royal Mail

[TrueBlueTerrier]

http://www.guardian.co.uk/frontpage/sto ... 44,00.html

· Company wants right to make doorstep deliveries
· Walkout costs state-owned operator lucrative clients

Terry Macalister
Monday July 16, 2007
The Guardian

TNT, the most aggressive private sector postal services provider, said the wave of industrial action hitting Royal Mail underlined the need for it to develop a full-blown rival service.

The Dutch-owned company, which uses Royal Mail to provide "final mile" postal delivery, said its customers were suffering disruption from the action by the union but it would not be suing the Post Office because it accepted that the state-owned group was protected by "force majeure" contractual clauses.

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TNT is the only company known to have been developing concrete plans to launch a complete rival service including the use of its own postal delivery staff. Its British boss, Nick Wells, said the impetus to proceed with such a project was higher than ever.

"It is still our strategic intent to create an alternative to the Royal Mail. It [the current dispute] highlights the fact that customers need options," said Mr Wells, although he refused to give any details about when the full-scale alternative would be launched, saying that would amount to releasing "sensitive commercial information".

TNT has been undertaking full-scale trials of next day door-to-door deliveries in Glasgow and Manchester although the vast bulk of its daily mail is distributed to homes through Royal Mail under the specially licensed "final mile" system used by several private operators.

TNT's group chief executive, Peter Bakker, said recently that Britain was one of its most important markets, showing healthy growth. The company is distributing more than 1 billion items of mail a year in the UK and many customers have migrated from Royal Mail, including telecoms group BT, which recently signed a contract worth up to £90m.

Others companies that have defected to TNT include food distribution firm Booker, mail order operation Express Gifts and another telecoms group, Caudwell Communications.

Business Post, another private sector rival to Royal Mail, said last week that its turnover had risen 13% in the first quarter thanks to a strong performance from its UK Mail arm which has won lucrative contracts from the financial services sector. Recent recruit Prudential takes the number of corporate customers to 400.

Among other postal rivals, DX has claimed it stands to make at least £10m this year out of the strikes, while Citipost has been trumpeting its winning of new customers such as the Economist magazine, which turned to the company to provide postal services during the dispute. "Regrettably, if the incumbent providers are unable to deliver what we need, then we'll have to go elsewhere and I'm delighted that alternatives exist," said Bob Milner, UK distribution manager of the Economist.

An estimated 10% of the 20 billion items posted each year in the UK are now handled by private firms while Royal Mail is also struggling against an overall downturn in annual mail volumes.

Royal Mail has warned the Communications Workers Union that customers who go elsewhere during the stoppages may not return, further damaging the state-owned group. The CWU last Friday organised a second 24 hour stoppage while management warned that a £1.2bn investment programme is being put in jeopardy by the strikes.

Royal Mail has offered its 127,000 postmen and women a 2.5% pay increase, plus a performance linked bonus of up to £800, and local productivity deals. It also wants to press ahead with modernisation plans to compete with its private sector rivals.

The CWU is pressing for a pay rise in line with inflation. It also wants Royal Mail to rethink the way it will implement its modernisation programme, claiming that the proposals would mean the loss of some 40,000 jobs. The latest dispute came as the European parliament voted to delay the liberalisation of European Union postal market until 2011.

[neil67]

http://business.timesonline.co.uk/tol/b ... 074985.ece

[cruisey]

I'd personally like to thank messrs Blair and Darling who couldn't wait to open the postal market in this country. Might have given RM time to work with the CWU and restructure the business in a less callous way than RM want now.

[Wild Cat]

Don't listen to TNT they are a complete pile of scab SHITE,first introduced to this country by the none other than the wonerful Rupert murdoch to break the print workers strike at wapping.They have no intention of delivering mail this is just scaremongering by them and their capitalist paymasters in the government(postcomm) who opened the market up to "competition" to break the unions power.The so called contracts royal mail have lost only end up being delivered by us the workers,YES that's right You and I still end up sweating blood and tears every day to deliver this s**t and no matter who wins the contract it will still be the same people carrying it out come rain or shine.

YOU CAN FOOL SOME OF THE PEOPLE SOME OF THE TIME BUT YOU CAN'T FOOL ALL THE PEOPLE ALL THE TIME