Royal Mail has today launched a parcel pick-up service across the UK in a shake-up of the daily round.
The new service – Parcel Collect – means postmen and postwomen will now be able to collect parcels as well as deliver them on their daily round. It is one of the biggest changes to the daily delivery since the launch of the postbox in 1852.
As well as offering even higher levels of convenience, the move means that online sellers and online shoppers will no longer need to leave the comfort of their home if they want to mail or return a pre-paid item by post.
Under the ground-breaking initiative, postmen and postwomen will collect a parcel from the customer’s door or nominated safe place for 72p per parcel, in addition to postage costs. Parcel Collect is also available for pre-paid return items at a cost of 60p per item.
Royal Mail can collect up to five parcels per address. Parcel Collect is available six days a week* and can be booked up to five days in advance and up to midnight the day before.
Nick Landon, Chief Commercial Officer at Royal Mail, said: “Royal Mail Parcel Collect is a fantastic step forward for all of our customers. It makes it easier to use our services than ever before. Whether you’re up against time and working from home, making a return, selling online or sending a gift to make someone’s day, Royal Mail Parcel Collect is here to help. The launch of Parcel Collect is part of our commitment to continuously make our services better and more convenient.”
Nicholas Hyett, Equity Analyst at Hargreaves Lansdown
Once upon a time the only collections associated with Royal Mail were folios full of stamps, but now the group is looking to get in on parcel collections straight from your door. The move has potential in our view, allowing the group to put more volumes through its existing network particularly in more rural areas where the universal service is more costly to deliver. However, there will be challenges too – not least in additional infrastructure expenditure and initial operational complexity.
Whether the initiative is enough to turn Royal Mail’s flagging fortunes around remains to be seen. A lot will depend on uptake, which if significant could make the group competitive on larger B2B contracts as well, but pricing in parcels remains tough and Royal Mail’s so far struggled to adjust to the rapidly changing landscape.
Dr Paul Simmonds, from Warwick Business School
From today Royal Mail will offer customers great convenience in how they access their parcel service.
Until today, customers had to take parcels to a post office to arrange and pay for them to be sent through the Royal Mail system. Now, postal workers will, for a small fee, collect parcels from doorsteps although the new service still requires additional customer effort. Customers will have to book and pay online for a parcel to be collected and to print off the necessary address/tracking labels. However, that effort will, assuming the customer has internet access and appropriate printing facilities, invariably be an improvement on going to a post office especially at busy times when there are queues.
This service enhancement represents a major change for Royal Mail who are lauding it as one of the most significant changes to the daily delivery service since the introduction of postboxes in 1852.
It is also a very visible signal of the company’s efforts to improve its efficiency and to recognise that parcels represent the future while letters represent the past. The shift to parcels has been happening for several years but the pandemic has certainly turbocharged the growth in internet shopping and therefore parcels volumes.
The new service will also be a test of how well Royal Mail can plan and organise what is a significant change in its operations that could result in substantial increases in parcels volumes. It’s a substantial investment and needs to pay off.
This is a necessary change and brings Royal Mail into line with other parcels companies who already make home collections. The advantage Royal Mail has is that they can leverage the costly delivery infrastructure they have to maintain in order to meet their Universal Service Obligation.
Royal Mail’s poor recent financial performance has, in part, been attributed to the cost burden of maintaining the USO and there was talk of negotiations to make some changes to it. The introduction of parcels collections and its use of the Royal Mail network may reduce the need for wholesale changes to the USO although some are still needed to stop Royal Mail from being disadvantaged in a very competitive industry.
Undoubtedly, this collection service increases customer convenience and should increase parcels volumes but how successful it will and how much of the future increases in parcels volumes Royal Mail will secure as a result remains to be seen. It’s also worth noting that Post Offices, especially sub post offices, won’t be too pleased by this new service as their volumes will fall as a consequence reducing their income.