Migration Of Mail Order Returns (MOR) To A Tracked Returns

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Letter to Branches





No. 416/15
Ref: 709.02
Date: 26th June 2015

For the attention of:

All Postal Branches
Divisional Representatives
Area Processing Representatives
Area Distribution Representatives
RDC Representatives


Dear Colleagues

Joint Statement Between Royal Mail And The CWU Covering Migration Of Mail Order Returns (MOR) To A Tracked Returns High Volume (TRHV) Service

Branches and representatives will be aware that Royal Mail and the CWU are working together in order to develop mutual interest solutions and factor into them opportunities to deliver on the core commitments contained in the Agenda for Growth, Stability and Long Terms Success Agreement.

That agreement recognised the need for a greater focus on growth via introducing enhanced customer offerings on current product range, creating growth through better utilisation of our existing pipeline and exploring more radical solutions. The Joint Statement attached to this LTB is consistent with that commitment and provides an operational change which proactively responds to the growing returns parcel market by redesigning our current Mail Order Returns (MOR) product into a Tracked Returns High Volume (TRHV) offering.

It should be noted that the return element of the parcel market is growing, in Royal Mail revenue has increased 16% in the last 12 months and it is anticipated that this traffic stream will continue to grow going forward.

The department have therefore concluded a Joint Statement with the business which we believe is self-explanatory and will cover the migration of the MOR in the existing network to a revised network, the details of which are covered off in the Operational Impact section of the attached document.

It is anticipated that this change will have no negative impact on existing operations and will positively expand the utilisation of our processing capabilities. We believe that representatives and members will welcome the development of this new TRHV service and recognise the potential that this new offering provides in growing both traffic volume and revenue streams going forward.









Any enquiries in relation to this LTB should be addressed to Terry Pullinger, Assistant Secretary, e-mail: dwyatt@cwu.org or shayman@cwu.org quoting reference number: 709.02

Yours sincerely


Terry Pullinger
Assistant Secretary
JOINT STATEMENT BETWEEN ROYAL MAIL AND THE CWU COVERING MIGRATION OF MAIL ORDER RETURNS (MOR) TO A TRACKED RETURNS HIGH VOLUME (TRHV) SERVICE


Background

Royal Mail (RM) and the Communication Workers Union (CWU) are working together in developing key business policies, mutual interest solutions and a new culture, all of which are at the core of the commitments in the Agenda for Growth, Stability and Long-Term Success Agreement.

Both parties recognise that creating the right joint working environment is key to the success of the business and the commitment to provide employment security in all operational functions of the business.

Both parties recognise the pressures of the increasingly competitive and rapidly evolving environment and are committed to the strategic objective of creating and developing an agenda for traffic, product and revenue retention & growth, as a positive alternative to simply managing decline across the RM operational network and defining a tangible competitive response.

Parcels competition continues to increase with competitors expanding their networks and delivering enhanced customer services. Royal Mail is responding to market challenges through a number of initiatives designed to defend and grow revenue & traffic, and to extend Royal Mail’s service capabilities.

The returns element of the parcels market is growing and in Royal Mail revenue has increased 16% in the last 12 months for this product offering, making it the fastest growing product in this market. Anticipating this growth, the Tracked Returns Enhanced (TRE) product was launched and is currently in deployment to 900 accounts, which will upgrade returns to a Royal Mail Tracked service. This product provides all the features retailers want. However, at the time of introducing this product offering Mail Order Returns (MOR) was excluded from the scope of this project.

MOR customers are demanding a service in line with what competitors are offering today and this has intensified having seen the new TRE product which offers Day C delivery and four scans. The current MOR product is based on a legacy Parcelforce Worldwide customer specification offering delivery from Monday to Friday, with Day E delivery, no tracking or management information. Eleven MOR customers generate c10 million items per annum. Existing MOR revenue and volumes are at risk if we do nothing.


Introduction

Royal Mail and the CWU have been working together to offer existing MOR Customers an improved service that offers delivery from Monday to Saturday, with a Day C delivery, tracking at three points in the process (at POL, on acceptance and delivery) and improved management information.

The MOR operation was originally set up at the Warrington Rail Terminal (WRT) in the North West in the late 1990s, based on the proximity of the operation to MOR customers at that time. Since then customers have relocated, which has to some extent made the design of the current MOR network inappropriate. In April 2015 the MOR operation at WRT was changed so that the RDC nearest to the customer would be the end point for handling returns. The service itself remained unchanged, i.e. Monday to Friday, with Day E delivery, no tracking or management information.



What Are We Doing?

Against that backdrop Tracked Returns High Volume will replace the former Mail Order Returns service. Customers will gradually be migrated across to the new service and MOR will become obsolete.

Tracked Returns consists of two options:

1. That which travels via the Mail Centre network (Tracked Returns Low Volume) and
2. That which starts in the Mail Centre pipeline, then flows through the 2C network to RDC’s for end scan and delivery (Tracked Returns High Volume).

Normally it would be determined whether a customer is routed to the Low or High Volume service at the point of customer take-on and account set-up. However, units handling TRLV (Mail Centres) that see volumes ramping up will be considered for a move to the TRHV service (RDCs).


When Are We Doing It?

The existing 11 MOR customers are expected to move onto the new TRHV service from July 2015 with the transition completed by November 2015.


Operational Impact

Currently 11 MOR customers are served by the following RDC’s:

Distribution Centres
YDC
WRT
NDC
PRDC
ASOS
SDG
Debenhams
Spring
Freemans
JD Williams
Cannons
 
RedCats
M&S
 
 
 
MissGuided
 
 
 
BooHoo
 
 

The proposal is to move these customers to the following RDC’s and Mail Centres.

Distribution Centres (TRHV)
Mail Centres (TRLV)
YDC
WRT
Leeds
Warrington
South MIds
Greenford
ASOS
Feemans
SDG
JD Williams
MissGuided
BooHoo
RedCats
M&S
Debenhams
Cannons
Spring

It is not expected that there will be any impact on staffing levels associated with the relocation of MOR traffic, however if any is identified the full terms of the MTSF Agreement will apply. Joint local dialogue will take place to establish if there is any impact and if so how that impact will be mitigated via local agreement prior to any deployment.




Involvement

Timely engagement will take place between local managers and CWU IR representatives in the process for taking on new customers. Appropriate Union release time will be provided for the CWU representatives to ensure meaningful involvement.

All proposals to prepare for this change at all affected sites will be dealt in line with the full terms of the IR Framework.

Any questions of interpretation, implementation, or application of this Joint Statement shall be referred to the respective Headquarters for resolution.



Terry Pullinger
Assistant Secretary
CWU
Francis Williams
Head of Parcels Design
Royal Mail


Date: 25th June 2015