Sacks of post could soon be piling up in sorting offices across
the country as members of the Communication Workers Union (CWU),
representing 160,000 Royal Mail employees, have voted unanimously
in favour of a boycott of competitors’ mail.
Hundreds of union reps voted to agree a policy to boycott private
mail companies’ post, which is sent to Royal Mail for the
“final mile” delivery via Downstream Access
contracts. If effectuated, the disruption could impact almost
half of all letters (44 percent) delivered in the UK.
Among its grievances, the CWU is worried that competitors are
“cherry-picking” the most profitable parts of the
delivery network and that competition in the postal sector is
“driven by a race to the bottom on the pay and condition of
postal workers”. It has urged the government and Ofcom, the
postal regulator, to intervene.
James Eadie, a spokesperson for Royal Mail, told Direct
Commerce that “All of our customers’ mail is important
to us and needs to be delivered.” He underlined that Royal
Mail has made it clear to the union and to its employees that
“It is vital for the sustainability of the Universal
Service that we continue to provide the high quality delivery
service that our customers have grown to expect.”
A spokesperson from TNT Post, one of Royal Mail’s main
competitors, says, “We disagree with the comments made in
relation to TNT Post by the CWU,” stressing that “TNT
Post continues to provide a high quality, innovative and
value-for-money service for our customers. We are creating many
new jobs in the UK for people who have been out of work for over
a year.”
With regards to the threat of industrial action, the TNT Post
spokesperson says it is a matter for Royal Mail, “but if
the situation did arise, we would work with Royal Mail to
minimise any disruption to our customers”.
A date for the boycott is expected to be set at the CWU’s annual
conference in late April, if progress isn’t made.
Fuel levy
If the threat of industrial action wasn’t enough, Royal Mail also
had to deal with a slew of criticism after unveiling its prices
for 2013 and introducing a fuel levy on certain business parcel
services.
Although standard practice in the industry, this represents a
first for Royal Mail. “The charge we will apply compares
very favourably to fuel surcharges already applied by other UK
parcel delivery companies,” says a Royal Mail spokesperson.
He adds that “at 2.5 percent, [it’s] considerably lower
than the current charges applied by other UK parcel carriers of 6
to 9 percent.”
Some retailers that Direct Commerce spoke to reacted
stoically; Boden’s marketing director Mark Binnington, for
example, says “We only use Royal Mail for a small
proportion of our parcel deliveries and these are mostly our
small/ low weight items. As such, the overall impact on us will
probably be quite small”. However, he adds, “Much
will depend on how the other carriers react.”
Others have been less resigned to accept the news. “We
recognise that Royal Mail is undergoing a period of change and
undertaking cost-saving initiatives. However, during a recession,
it is unfair that loyal business customers and consumers should
have to shoulder additional costs for the same services,”
says Ruel Taylor, operations director at online retailer Mobile
Fun. “Although Mobile Fun receives a volume discount on
Royal Mail delivery services, the addition of fuel surcharges
will effectively nullify this discount,” he adds.
Taylor says that Mobile Fun will also be hit by higher costs for
the majority of its parcels following the withdrawal of the
0-750g weight band. But both Boden and Mobile Fun say they’re not
planning to pass on the increase to consumers. “We have
been working to reduce individual product packaging so that we
can keep delivery costs down and pass these savings on to our
customers,” Taylor explains.
In addition, Taylor says Mobile Fun is about to trial the
introduction of courier delivery to nationwide collection points,
allowing customers to collect their parcel at a convenient time.
“With the new pricing structure, it will become a daily
battle to keep costs down without compromising customer service
and delivery times,” he says. “Many businesses, like
ours, simply do not have sufficient margins to continue offering
next-day delivery at an affordable low price for our customers.
We have no choice now but to begin offering our customers cheaper
and therefore slower delivery services, which is a bitter pill to
swallow.”
Share