Postage price hikes - what is the true cost to DELIVER?

A loss of almost £1 billion over the past four years is hard to swallow and now the UK Royal Mail is feeding that to us. A Royal Mail postal rate increase, the biggest in percentage terms since 1975, is set to hit your mail budgets by 30%. Not good news for output managers looking to spend their bonus on a new Porsche, or even just to get a bonus.

When I checked out comments on Royal Mail's website regarding their previous financial losses, it stated they "were unable to charge the price the service truly costs to deliver." Well, I have to say that I wasn't totally turned off at them responding with a postage hike. Even at 60p, Postman Pat is earning his keep. Next day delivery come rain or shine isn't a bad offer for that price. I'm still buying.

Still, the question shouldn’t be the future of Royal Mail but rather yours. How are you going to deal with the instant reduction to your paper billing budget? Maybe you could add a “Royal Mail Tax” onto your bills? Or start applying the GE approach and fire the bottom 10% of your team? This is serious stuff with some companies set to lose millions off the bottom line.

If the future is eBilling, let it begin now. While you may already take online payment through your current portal, paper turn off still lingers around 15% for most companies. And, that is often driven by marketing the portal on paper. Does that rate of paper turn-off solve your budget deficit? I think not.

eBilling and eMarketing are more crucial than ever before

It’s been proven time and time again, ‘Push’ eBilling consistently results in:

• 25 -70 % paper turn off
• reduced DSO
• reduced call centre volume
• increased cross sales through intelligent and personalised marketing campaigns

So what is the true cost to deliver? Far less than the cost of a new Royal Mail postage stamp.