Royal Mail Group

The Royal Mail Group operates through two core divisions: UKPIL and GLS. UKPIL operates in the UK collecting and delivering parcels and letters through two main networks, the Royal Mail Core Network and Parcelforce Worldwide. GLS operates in continental Europe and the Republic of Ireland and has one of the largest ground-based deferred parcel delivery networks in Europe.

UKPIL provides letter and parcel services to and from countries around the world under reciprocal arrangements with other overseas postal administrations. It is also responsible for the design and production of the UK’s stamps and philatelic products.

Through MarketReach, UKPIL provides a full-service marketing mail offering and helps businesses derive more value from their direct mail.

UKPIL’s modernisation programme is one of the largest undertaken in the UK in recent history. The programme is about making our combined UKPIL core network, which handles 90 per cent of the parcels and all of the letters we deliver, more competitive and effective. We are delivering benefits. Eight out of ten letters are now automatically sequenced into walk order. We are progressing with delivery revisions, with 860 Delivery Offices modernised since the programme began, representing more than half of walks.

  • Parcels

    Across the Group our parcels networks are benefitting from growth in online retailing. It is estimated that by 2016, online retailing will account for 23 per cent of the UK’s overall retail spend. Royal Mail is well positioned to benefit from this.

    We are taking steps to optimise delivery processes to reflect the increasing number of parcels in the mailbag.

    We have distributed 44,000 Postal Delivery Assistants to postmen and women, we have a fleet of more than 5,500 shared delivery vans, and we are increasing efficiency and reducing cost wherever possible by routing traffic through our core network.

    We are innovating and investing in this business to ensure we can continue to drive profitable growth without compromising on quality. We know customers use us because of our brand, our reach and our commitment to quality.

  • International business

    Our international operations, based in the UK, work closely with postal administrations across the world to despatch outgoing mail from the UK and deliver items from overseas to customers at home.

    The increase in borderless online retailing continues to drive growth. As with our domestic business, parcels are a growing percentage of the mail mix.

    The international market is a key focus for future revenue generation. In addition to our existing network, including our state of the art processing hub close to Heathrow Airport, we are investing and innovating for the future.

  • Mail, media & unaddressed

    Direct Mail by itself is one of the most effective advertising stratagems. Coupled with other channels, its effectiveness is significantly enhanced. That’s why some of the world’s leading internet companies advertise their services through Royal Mail.

    We have renewed our focus on media and marketing mail to leverage our reach, our customer data, and customer relationships, and have targeted our top 3,000 advertisers with our improved end-to-end services.

  • Mail services

    Collecting and delivering stamped and metered mail is our core business. Ofcom, our regulator, has said that Royal Mail is the only company capable of delivering the Universal Service: a one-price-goes-anywhere, six day a week delivery service to 29 million addresses across the UK.  For more detail, please see our Universal Service section.

    In March 2012, we welcomed a new regulatory framework, which allows Royal Mail to compete fairly in the transactional, bulk mail, and direct mail sectors. The new framework will allow us to earn a fair commercial return for the majority of services we provide. Even with this return, we remain highly competitive.

    Modernisation remains a priority. During the year we completed the upgrade of letter automation in our mail centres, which has made delivery rounds more efficient.

    Our modernisation programme, along with a simpler portfolio, will also help reduce costs across UKPIL’s Business mail arm. But more remains to be done. We must complete our process of modernisation so as to compete effectively in the UK market.

    This means not only making savings on costs, but also delivering a more efficient network and changing every process in the business. The time of maximum change is now.