Nearly two-thirds of all UK business mail will be cheaper to send, with a further 20% remainingat the same price to send as now, when Royal Mail introduces its new pricing system, Pricing in
Proportion, on 21 August, the UK postal operator said.The prices applicable from 21 August have been finalised following Royal Mail’s acceptance of aprice control proposed by Postcomm that resulted in an increase in stamp prices on 3 April 2006.Royal Mail is sending the new PiP price information to its business account customers throughoutMay and has published the new prices on its website.
Royal Mail’s rebalancing of its prices under Pricing in Proportion means that postage will bebased on the size and shape as well as the weight of mail so that they better reflect the costs ofcollecting, sorting and delivering mail. While some prices will increase, most will either decreaseor stay the same and the changes will not generate any further revenue for Royal Mail.
David Dale, Royal Mail’s Pricing in Proportion Project Manager, explained:
“Pricing in Proportion is being introduced to better reflect the cost of collecting, sortingand delivering mail. The new prices, applicable from 21 August, are available now so that customershave time to prepare for the changes and to identify any potential benefits. Businesses could forexample reduce their postage prices by folding A4 items in half and posting in a C5 envelope sothat they are priced under the new Letter category.”
Royal Mail is implementing a £10 million customer awareness campaign to support the introductionof PiP. The campaign will incorporate TV, radio and press advertising as well as information in all14,500 Post Office® branches. There will also be a mailing to every business and residentialaddress in the UK to communicate the changes.
Royal Mail noted that similar pricing changes had already been successfully implemented by otherpostal administrators in Republic of Ireland, Belgium, Denmark, Finland, Greece, Italy, Luxembourg,Australia, Canada, Japan and the USA. Other countries with forms of size based pricing includeAustria, Germany, the Netherlands, Poland, Slovenia, Switzerland, Hong Kong, New Zealand, and SouthAfrica.
