Ofcom’s recent report suggesting Royal Mail could deliver over three days instead of six and save up to £650million has received mixed reactions, with experts convinced it is unnecessary to drop the current configuration to save money.
The regulators found the postal service was “getting out of date” and that action was “urgently needed” as the current state of the network is “not sustainable”.
But the Government has ruled out changing the Royal Mail model to a three-day service, stating that a “sustainable model” is possible without forfeiting delivery days.
Making that particular sacrifice is likely unnecessary, as other nations, namely Germany, have successfully proven.
The country has managed to ensure its own postal service can deliver mail six days a week by making changes to its model elsewhere.
Deutsche Post, Germany’s national postal service, has a nationwide universal service mandate, allowing it to make deliveries while its competitors can choose where to conduct their business, provided they pay a sales tax.
The legislation permitting this arrangement was recently updated for the first time in 30 years and recommitted the firm to a six-day letter service.
Officials have managed to make this work by reducing Deutsche Post’s standard letter service.
Instead of the previous one-day delivery standard, the firm now delivers letters in three.
Deutsche Post now also makes more money by making its now nonstandard one-day delivery a premium service.
Royal Mail could learn from other nations’ models, according to Bob Black, Non-Executive Director at global end-to-end supply chain consultancy TMX Transform and former COO of Australia Post.
Mr Black told the Express there are multiple ways to tweak the postal services, in line with other nations, that could save money without navigating away from the six-day model.
He said: “Other countries have shown that there are opportunities to make efficiencies within such a structure through the workforce and network design.
“Many outdated customs and practices, such as shift times, pre-sorting and organisational structures could be challenged.
“Plus, improved automation, sequencing of letters and consolidation could also deliver significant benefit.”
