Royal Mail delivers growth and predicts demise of rivals

[TrueBlueTerrier]

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The boss of Royal Mail expects rival parcel-delivery companies to disappear amid intense competition, claiming “there’s too much capacity” and that the current low prices are unsustainable.

After City Link and Yodel toiled in the run-up to Christmas, Royal Mail’s Canadian chief executive, Moya Greene, hinted that more firms could collapse this year, saying: “There’s too much capacity in the market, and it’s put pressure on prices. I don’t want to predict the demise of other companies, but I’ve been in this country for five years now and we’ve had an awful lot of players in the market, with many of them sadly not being financially successful. There needs to be a new equilibrium in this industry.”

Ms Greene believes this is the year when “big retailers will realise that quality counts” and opt for its services over those of smaller upstarts.

Her comments came as Royal Mail delivered unexpectedly decent festive results, with UK parcel deliveries up 4 per cent, sending it to the top of the FTSE 100 for a time. After City Link went bust on Christmas Eve and Yodel admitted it couldn’t keep up with demand, Ms Greene said: “Our early Christmas planning, which we started on April 1, paid dividends.”

Royal Mail delivered 120 million parcels in December, which Ms Greene boasted was “more than the vast majority of parcel industry participants deliver in a whole year”.

She added: “This year some of our competitors unfortunately saw their networks struggling under the weight of the surge in Christmas traffic. We’re very happy that did not happen to us.

“This year, big retailers will realise quality counts and it’s worth paying for. A good delivery partner has a halo effect: consumers are more likely to order from them again.”

However, asked if the stronger results meant Royal Mail’s universal service was safe, Ms Greene batted back: “I’m only going to talk about Christmas.”

Royal Mail’s UK business was flat in the nine months to December, but 8 per cent growth in its European parcels business meant group revenues rose by 1 per cent.

The company made a stark warning in November that Amazon’s decision to launch its own next-day delivery network would clobber its parcels business. Royal Mail said that, as a result, it was more than halving its expected growth rate in the UK parcel market: the 6 per cent it predicted at its floatation in 2013 was chopped to 1 per cent to 2 per cent for the next two years.

The shares rose 15.30p, or 3.55 per cent, to 445.80p.

[beezet]

Why is it with Moya is it always doom and gloom. Give us some good news for a change

[Nigel1505]

Here Here. Nobody can help the face they were born with, but I do wish Ms Whalley would smile at least once on RMTV and not look as if the has lost a pound and found a shilling (An old phrase, I know).

[comeracing]

Have to laugh at parcel increase of 4 % more like 14 %.

[ted_e_bear]

Ms Greene said: “Our early Christmas planning, which we started on April 1, paid dividends.”

What, don't think we'd started our Christmas planning even on December 1st !

[TrueBlueTerrier]

Ms Greene said: “Our early Christmas planning, which we started on April 1, paid dividends.”

What, don't think we'd started our Christmas planning even on December 1st !

[Nigel1505]

Planning in our office was done by...................You've guessed it..............BALDRICK it was a cunning one.

[Lincox]

Ms Green,es plan was all about warehousing. She would not be able to plan deliveries even if a good one was put in front of her. Her only plan for deliveries is slash and bully.

[Lounge Lizard]

Ms Greene said: “Our early Christmas planning, which we started on April 1, paid dividends.”

What, don't think we'd started our Christmas planning even on December 1st !

The plan devised on April Fools Day was to start thinking about Christmas on 1st December. ( So eight months of first )

[redandblue]

If Moya is predicting the demise of rival courier firms this year, and is planning for RM to take up the slack. Why the f..k is she insisting that we have to cut jobs?
Who the hell does she think will be delivering the extra work load, the Tooth Fairy?
She really does need her bumps felt. She lives in cloud cuckooland.

[Lincox]

She has been getting away with it for some years now because there is lack of support for cwu at grass roots and no backbone at CWU heirarchy level. She knows it and will continue to decimate in order to achieve the goals she has been set and to continue to feather her own personal nest.

[raikky]

royal mail does not want the business, cause theyd then have to hire. hence why it overcharges for heavy pkts

[NWpostie]

royal mail does not want the business, cause theyd then have to hire. hence why it overcharges for heavy pkts

Doesn't make good business sense.