Rival becomes part of the package for RM with new agreement

[TrueBlueTerrier]

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Royal Mail will fight back against companies eating into its business by joining forces with one of its rivals.

The state-owned postal operator has granted a licence to UK Mail to handle packets up to 5kg in weight — the sort of goods mailed by the likes of Amazon or department stores such as John Lewis.

It is reckoned that Royal Mail has lost up to 40 per cent of this market to private mail order operators such as the Home Delivery Network, owned by the Barclay brothers, which deliver directly to homes.

The new Royal Mail arrangement, which will begin on April 6, means that UK Mail will handle the bulk mailing of such items — typically in excess of more than 1,000 items a night — for customers, oversee the sorting and then hand them over to Royal Mail postmen for the “final mile” delivery. Even including its fees to Royal Mail, UK Mail is confident that it can undercut the opposition.

Guy Buswell, chief executive of UK Mail, said: “It is good business for us and good business for Royal Mail getting post back into its network.”

The market for packets up to 5kg is thought to be worth £1.5 billion a year and is expanding as retailers turn increasingly to mail order and the internet. Mr Buswell said: “It represents the next logical step for UK Mail, given the success our mail business has enjoyed since its start-up at the liberalisation of the postal markets six years ago.”

The news comes as the spectre of further industrial action at Royal Mail after last November’s damaging one-day walkouts was lifted after the Communication Workers Union signed a peace deal in return for a 6.9 per cent pay rise spread over three years.

Separately, TNT, which like UK Mail has taken significant market share in bulk mailings of bank and utility statements, will launch a pilot project in Scotland aimed at medium-sized businesses.

[nelson]

I just hope they have got the price correct this time for the final mile

[Lounge Lizard]

I just hope they have got the price correct this time for the final mile

"the final mile" doesn't do justice to Royal Mail's work in taking it often many miles from Mail Centre via Delivery Office to its final destination.

[the shadow]

I just hope they have got the price correct this time for the final mile

"the final mile" doesn't do justice to Royal Mail's work in taking it often many miles from Mail Centre via Delivery Office to its final destination.

Quite agree Lounge Lizard. I,m a 600 driver in the south west. i pick up york after york of downstream access from the mail centre, which is then transfered to my delivery office 53 miles away. Our delivery office is the main hubb for the area, from there it is distributed to the smaller delivery offices, some of them 20 miles away, then from those the final delivery point can be up to 6 0r 7 miles from there. 53 +20+7 =80. Final mile? Yeah right!!