Royal Mail posts a £1.04bn loss

Royal Mail posts a £1.04bn loss

Beleaguered by strikes, which not only discouraged consumers from using its services but caused huge disruption to its business customers whose mailings of letters, catalogues and parcels were held up in the peak pre-Christmas period, Royal Mail has recorded an annual loss of £1.4bn for the year to March 26th, 2023.

The industrial action called by the Communication Workers Union amounted to 18 days of strikes which were timed to have a catastrophic impact and resulted in many of its business customers taking their accounts to alternative carriers. This in turn led to some of those alternative carriers in the parcel sector being overwhelmed by extra demand and service levels dropping. It also meant that online and mail order traders had to introduce earlier cut-off rates for Christmas orders which, many said, cost them a significant amount of much needed business as shoppers headed to stores rather than risk the disappointment of gifts not arriving in time.

Whilst a pay deal has been agreed, CWU members have still to vote on whether it is acceptable to them.

Meanwhile, Royal Mail insists that it must modernise in order to be able to continue to stabilise its business going forward. This may include placing further pressure on the government to review the Universal Service Obligation (USO) under which it must currently operate. The USO requires deliveries to be made six days a week across the country, Royal Mail is pressing for this to change to five days a week.

As previously reported Royal Mail CEO Simon Thompson has resigned his role and is set to leave at the end of October.


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