5 day Royal Mail letter deliveries would save £225m

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Ofcom have concluded that cutting Royal Mail letter deliveries to five days a week instead of six wouldn’t make a great deal of difference but could save the company up to £225m per year. It’s all about whether the Universal Service Obligation (USO) is financially sustainable in the longer term and the answer to that is probably not.

Cutting Royal Mail letter deliveries to five days is emotive, but in today’s world where many already receive electronic billing, the biggest difference most would notice is the lack of junk mail on a Saturday. Yes, there will be some who complain their Birthday is on Saturday and they’ve love to receive cards on the day, but the same is already true if your Birthday falls on a Sunday so that argument isn’t valid. Plus Royal Mail will still delivery premium mail such as Special Delivery as well as parcels and that covers off most of those who would complain.

Ofcom discovered that the current six day a week letter delivery requirement meets the needs of 98% of residential users and 97% of small and medium-sized businesses in the UK. Reducing this to five days a week, but leaving all other elements of the service unchanged, would still meet the needs of 97% of these users.

There are some online sellers of small items who use letter post and this would be a challenge. However once consumers became accustomed to no letter post at the weekend and marketplaces adjusted their shipping profiles this would be a temporary blip the country would soon grow used to.

“Our research suggests that people’s needs would still be met if letter deliveries were reduced from six days a week to five.

It would ultimately be for Parliament to decide whether this change is needed. However, Royal Mail must still modernise and become more efficient, to keep pace with customers’ changing needs.”
– Lindsey Fussell, Networks and Communications Group Director, Ofcom

The reality is that moving to a five day a week Royal Mail letter deliveries is almost certainly going to happen, the only real question is when?

“Royal Mail is proud to deliver the ‘one price goes anywhere’ Universal Service which is so valued by customers across the UK. Our unique responsibility began in 1840 when the world’s first adhesive postage stamp, the Penny Black, was used as payment to create a uniform postage service. Times may have changed a lot, but the Universal Service remains vitally important. With changing user needs, which have been accelerated as a result of the pandemic, there is a clear need to move with the times.
 
To stay relevant and sustainable, the Universal Service must adapt to life in the 21st Century. Ofcom’s User Needs Review has shown that reducing letter deliveries to five days a week would still meet the needs of nearly all people and businesses. In the last six months alone, letter volumes have fallen by around a third. The reduction in letter volumes has had a significant impact on the finances of the Universal Service which lost £180 million in the first half of the year. This, along with our own comprehensive customer research, demonstrates the need to rebalance the Universal Service in line with growing consumer demand for parcels, and lower usage of letters.
 
We are working hard to improve efficiency and transform our parcels operation. We have increased the automation of parcel sorting and are investing in two new parcel hubs. But at the same time we recognise that the business has failed to make the progress it would have liked on operational productivity and agree that this must change. Too many parcels are still sorted by hand, and we have not adapted quickly enough to the decline in letters. We’ve taken immediate steps to stabilise business performance and set Royal Mail back on a path towards profitability. But as we have said previously, these measures and the delivery of our transformation plan will not be enough, in themselves, to ensure the USO is financially sustainable in the long term.
 
We will consider Ofcom’s findings very carefully. We look forward to engaging further with Government, Ofcom, our unions and other stakeholders to ensure the Universal Service continues to meet the changing needs of consumers, and ensure it remains financially sustainable.”

– Keith Williams, interim Executive Chair, Royal Mail Group

11 Responses

  1. There’s a big difference in a Postie in a van running around on a Saturday only stopping at houses where a parcel is being delivered, compared to a Postie going to every single house with letters and can’t carry all the parcels….. so you still end up with another Postie running around in a van.

  2. This totally ignore the many large letter or small packet items that could and should be delivered on Saturdays.

    I would argue the opposite to the toothless ofcom, namely that there is a case for delivering on Sundays as well.

  3. Makes sense and should be implemented.
    Most people wouldn’t notice.
    Hermes will probably take the small package (eg clothing) market completely anyway.

  4. I could live without a Sat delivery, but we are in a world where people want it “now”.

    I have not had a large letter item delivered all WEEK so far using there 48 service it is appalling I have the requests already on eBay and all the rubbish that comes with that site.
    Just had to upgrade again to 24 hour post which will probably be delayed again. It has cost a fortune this year with Royal Mail it is really bad for business.
    Where is the planning and upscaling to deal with demand.
    The place I drive for in the evening went from 9 drivers to 60 now in 6 months and extended slots…because there is demand.

  5. My mother in law is delighted to receive love letters/flowers/cards on daily basis (including Saturday and Sunday).

    She finally installed WhatsApp…

    Her friends are sending the virtual goods!

  6. stark staring raving bonkers crackers
    due to the internet the world in now open for online purchases 24 hours 7 days a week
    royal mail want to go backwards only opening 5 DAYS A WEEK

  7. Reading the headline, I thought it meant letters would take 5 days to be delivered – a huge improvement over their normal “service”.

  8. Just a heads up…. The article clearly states LETTER POST. Not parcels.
    So only letter post would be axed on a Saturday.
    With the letters market shrinking increasingly fast each year, it makes sense to concentrate more on parcels.

  9. if your putting logistics in place and employing people on a Saturday to delivery parcels , seems daft not to include the letters

  10. They are dealt with separately. My parcel deliveries are always delivered at a different time. Indeed at my business address we have a letters round postie and a parcels round one. The letters are mainly moved around on pullable trollies, the parcels by van. My business postie tells me that when they used to do both at same time it was far too time consuming and difficult as volumes rose.

  11. Poor chap increased business making it difficult
    And time consuming
    Customers sending mail are just plain nasty

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