Letters, in particular business post,
are a core part of our business.
Letters, in particular business post,
Our consumers and businesses may be posting fewer letters as they embrace digital communications. But our business letter post remains an important part of our core services. We are listening to our customers and responding to their needs to provide postal services they value alongside the Universal Service.
Our core business
Around 12 per cent of all letters sent is consumer mail. Most of this post is sent over the Christmas period. The vast majority of letters are generated by companies. Many of them rely on direct letters and advertising mail to sustain and develop their business. Letters remain a core part of our business.
The reality is that, like most postal operators in other major developed countries, the UK letters market is in systemic decline but it is still a really important part of our business. Consumer spending on post remains low. The average household in the UK today spends around 50p each week on post, equivalent to just 0.1 per cent of expenditure.
The Hooper report on saving the Universal Service in the UK said we had to focus on customer needs to ensure a sustainable business. We are managing the ongoing decline of letters alongside the increased number of delivery addresses by focusing on our customers and maintaining a high quality network. To grow our business and support our business strategy, we are looking at additional revenue streams from unaddressed and direct marketing mail.
We are responding to customer needs. We are taking a more proactive approach. For example, we have already written to more than six million customers to make them aware that we are transforming the way we deliver mail in their communities. We will write to many more customers as the modernisation programme is rolled out across the country.
Our Universal Service: delivering postal services for everyone
With our established delivery networks, and a mandate enshrined in legislation, we are the only postal operator capable of delivering the UK’s Universal Service. The Universal Service offering guarantees a one-price-goes-anywhere nationwide collection and delivery to 29 million addresses across the UK, six days a week.
Royal Mail collects from more than 115,000 post boxes and around 11,800 Post Offices. In order to collect and deliver all the mail, we work through the night. The operation involves our countrywide network of mail centres, fleet of more than 39,000 vehicles, around 1,356 delivery offices and our 127,000 postmen and postwomen who deliver the mail. As a result, UK businesses and consumers enjoy some of the highest quality of service standards in Europe, with our minimum next-day target of over 93 per cent 1st class mail, the highest of any major European country.
UK stamp prices are amongst the best value in the EU. In five of the six weight steps for First Class and Second Class mail, the UK cost of UK stamps are ranked in the bottom half of prices when compared with other European countries. In the 51g to 100g weight band, the new 50p price of a Second Class stamp will be the lowest in Europe.
Modernising to ensure we get it right
We are committed to improving the service that we offer throughout our programme of transformation and change. As part of our major modernisation programme, we are looking at every one of our processes – including collecting, sorting, and mail delivery. Our aim is to make sure we improve efficiencies and use relevant technology such as automated mail sorting, walk sequencing and Postal Digital Assistants to help our teams deliver a premier delivery service.
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© Royal Mail Group Limited 2014