Royal Mail Group

I

Introduction

Royal Mail Group, formerly The Post Office Corporation, the General Post Office, and then Consignia, the United Kingdom's national postal administration, which operates as a public limited company owned, but not managed, by the British Government. It is highly regarded as one of the world's best and most efficient postal systems and operates through three major brands: Royal Mail, the letters business; Post Office, the retail business; and Parcelforce Worldwide, the parcels business. Royal Mail Group is one of the few national postal administrations to operate without government subsidy.

II

Royal Mail

The largest of the three Royal Mail Group brands, Royal Mail is responsible for the collection, sorting, distribution, and delivery of letters and packets throughout the United Kingdom. It also sorts and despatches mail posted in the United Kingdom for delivery overseas, and receives and delivers mail from other countries to UK addresses. It employs about 160,000 people and accounts for about 75 per cent of the Royal Mail Group’s turnover, which was £9.056 billion in 2005-2006. It handles approximately 430 million letters a week, equivalent to 84 million letters every working day, and collects mail daily from more than 110,000 pillar boxes and delivers to all the United Kingdom's 27 million addresses, no matter how remote, at a uniform cost.

In 1968 Royal Mail replaced its traditional services with a two-class postal system—first class mail for letters to be delivered on the next working day after posting, and second class with a three-day delivery target. It delivers 94.1 per cent (2006) of first class mail on target. Since August 2006 the cost of postage within each class has been dependent on the size of the item being posted—letter, large letter, or packet—as well as the weight of the item. These services are augmented by added-value services that guarantee delivery by a specified time, and can also provide compensation for loss of, or damage to, the contents. Royal Mail provides a range of services for high volume and magazine mailings that attract discounts in return for some pre-sorting by the mailing house. These services are used by publishers, mailing houses, mail-order warehouses, and similar organizations.

Automation of mail sorting began in the 1970s with the introduction of postcodes for the whole of Britain. These codes comprise two adjacent groups of letters and numerals that identify the destination town and an individual address or block of addresses. Integrated Mail Processors (IMP) machines scan-print and type postcodes, printing them on the envelopes in a machine-readable form so that sorting can be carried out automatically at high speed—currently up to 35,000 letters an hour. Virtually all letters and cards—including those with handwritten addresses—are sorted by machine.

Mail is distributed within the United Kingdom by a transport network that integrates road, rail, and air into a high-speed system. Its transport fleet of 30,000 vehicles is one of the United Kingdom’s largest. Royal Mail also has a fleet of over 30,000 bicycles. In June 2003 it announced its intention to use a road and air network only, with rail services phased out by March 2004. It then brought back a limited use of rail transport in 2005, with two services a day carrying post between London and Scotland.

Royal Mail has a thriving philatelic arm to meet the needs of stamp collectors worldwide. It issues a number of sets of special stamps each year, commemorating important historical anniversaries or other events. Subjects for special stamps are chosen about three years in advance. Its Philatelic Bureau, at Tallents House, 21 South Gyle Crescent, Edinburgh, EH12 9PH, offers a range of products for collectors and also publishes a monthly journal devoted to the subject. Royal Mail caters for 70,000 younger collectors through its collectors' club that offers advice and information about collecting to children throughout the world. In 2004 a system was launched—aimed primarily at small businesses—that allows users who have paid a monthly or yearly fee to create and print their own stamps. The ability to pay for postage online was extended in September 2006—consumers are now able to pay for and download a barcode that can be printed onto an envelope.

III

Post Office

This operates as a retail business supplying a wide range of services. It pays out cash for Government departments (social welfare benefits, state pensions); issues motor vehicle licences; and accepts bill payments for phone, gas, electricity, and other utility companies, local authorities, and other public corporations. It also provides a retail outlet for the other Royal Mail Group businesses. The Post Office provides banking and similar services for the Alliance & Leicester Girobank and a growing number of high street and Internet banks, and the National Savings Department; it also issues foreign currency and travellers' cheques in collaboration with American Express, provides travel insurance in partnership with the Norwich Union insurance company, and acts as agents for the MoneyGram international money transfer service. It is the United Kingdom's biggest retail outlet selling tickets for Britain's National Lottery. It is Europe's largest retail chain, with some 14,300 outlets; about 28 million customers visit Post Office branches every week. In May 2007 the government announced that 2,500 of these branches are to close by 2009. Until 2001 the Post Office was known as Post Office Counters.

The overwhelming majority of post offices are owned privately and run in association with small businesses such as newsagents or village stores. A small number are franchised out to retail chains and are located in supermarkets. Others are run by agents acting on behalf of the Post Office, and about 500 are directly owned.

A £130 million scheme to install new electronic terminals in all Post Office branches to automate the payment of benefits and other services was completed in the late 1990s.

IV

Parcelforce Worldwide

Parcelforce Worldwide is the leading distribution company in the United Kingdom and delivers to all of the United Kingdom's 27 million social and business addresses, regardless of location. It offers both a guaranteed express and standard parcel service within the United Kingdom and overseas, and gives guaranteed delivery times from same day to 48 hours, with compensation for loss or damage. It uses electronic tracking and tracing on all its services. Parcelforce Worldwide handles 45 million parcels a year, and delivers to 239 countries and territories worldwide. The Royal Mail Group also has a European parcels business, General Logistics Systems, which handles more than 1 million parcels a day, delivering in 34 European countries.