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Death knell for mail monopo
Page 14
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Business Post is set to break Royal Mail's postal monopoly. Guy Sheppard reports.
PARCEL DELIVERY company Business Post is finally on course to break Royal Mail's postal monopoly from April after settling a long-running dispute over pricing.
A licence to operate bulk mail services for business customers was originally granted in November 2001, but it always depended on Royal Mail agreeing to handle -final-mile" deliveries to customers.
Now the two sides have agreed in principle about pricing and conditions; they are due to sign a formal agreement later this month (January).
This will allow Business Post subsidiary UK Mail to collect mail from business customers anywhere in the country and carry out the initial sorting and trunking.
Paul Carvell, chief executive of Business Post, says the service will represent the first large-scale breach of Royal Mail's postal monopoly since it was opened up to competition. "Trials will commence in earnest at the beginning of April and new customers should start to come on stream by mid-April," he adds. "My guess is that there will be an extra 750 jobs minimum over the next three to four years.
"It will double our existing turnover of fl 56m and we will probably need between 100 and 200 extra vehicles. But we will be looking in the early period to use as much of our current resources as we can."
Carvell does not expect the company's 41 franchisees to increase in number but he says: "As the business takes off maybe we will help them to develop larger premises or add more vehicles to their fleets."
Postcomm, which regulates postal services, predicts that competition in the sector will gather pace as a result of the deal because it shows that Royal Mail now accepts the commercial logic of such agreements.
Carvell says Deutsche Post and TPG. the Dutch postal group which owns TNT, will be particu larly keen to enter the UK posta market. But he predicts: "If we continue with the momentum we will be the largest for some consid. erable