Renewed focus

Letter volumes continue to decline rapidly, while parcels see strong growth

In the first half of the year, we continued to see a staggering reduction in the volume of letters we deliver. Addressed letter volumes (excluding elections) are down (28 per cent), while parcel volumes are up (31 per cent).

This significant change in customer sending habits is reinforcing our view that the best way to ensure the Universal Service Obligation (USO) continues to meet our customers’ needs is to rebalance our service model more towards parcels. We look forward to the publication of Ofcom’s ‘User Needs Review’ before the end of 2020, and we will be considering the findings carefully. 

Keith Williams, interim executive chair, Royal Mail Group, said: ‘As I have said before, we remain committed to the universal, affordable, “one price goes anywhere” nature of the USO.

‘We have spoken to many of our customers in recent months and it is clear our customers value and want to retain the principle of the USO. They also tell us they want more frequent and convenient parcel deliveries, alongside an affordable next-day letters service.

‘We are urging Ofcom and the Government to consider swiftly what changes may be appropriate given rapidly changing customer needs, as well as the risks to the financial sustainability of the USO.’

Putting the customer first

We have been pushing forward with our transformation to become a more agile business, while delivering more innovation, products and services for our customers.

The quick roll-out of Parcel Collect – our doorstep parcel collections service – is a great example of this. It has already been used more than 76,000 times since the launch at the end of October.

‘If there is one magic ingredient to being a successful business, it is putting the customer first,’ said Keith. ‘So, I am confident this renewed focus will stand us in good stead for the future.

‘However, to turn around our performance, and to become the profitable and sustainable business I know we can be, we also need to control our costs and be more efficient.’

We are on track to deliver the cost savings and restructuring programme we announced in June. We have also increased the pace in the delivery of our transformation; we are making good progress on the construction and fit out of our first two parcel hubs, and we are rolling out more and more parcel sorting machines across our network.

19 Nov 2020