TNT posties set to explode monopoly

Published on Saturday 19 January 2008 16:29

A FLEET of orange-uniformed TNT postmen will soon take on the Royal Mail on the streets of Scotland, the boss of the private postal operator has hinted.

Nick Wells, chief executive of TNT Post, told Scotland on Sunday that the company was gearing up to launch trials of its first "end-to-end" service, where items are picked up, sorted and delivered by TNT staff without any involvement from the Royal Mail.

He gave his clearest indication yet that some of the locations, which the company has so far refused to confirm, are likely to be in Scotland.

"We're going to deliver an end-to-end delivery to carry out the final mile of addressed mail," he said. "You could find there will be orange postmen on the streets of Scotland."

Although a number of private operators have entered the UK postal market since it was opened up to full competition in February 2006, Royal Mail continues to dominate what is referred to in the trade as the "final mile" – the actual delivery of letters and parcels to individual addresses by postmen.

Since its launch in Britain in 2003, Dutch company TNT Post has seized a 9% share of the market, yet it still has to rely on Royal Mail for the final leg of deliveries, effectively handing business back to its competitor.

Wells said: "Last year we handled over 1.8 billion items, but we give all of that back to Royal Mail. Royal Mail still do the end-to-end. We're Royal Mail's biggest client."

It is understood that TNT Post is planning to launch its own end-to-end service early this year in order to reduce the amount of business it hands back to its rival.

Although Wells refused to disclose locations and timings of the end-to-end pilots for competitive reasons, he said TNT Post has been building up a sizeable business in Coatbridge, Glasgow, over the past 18 months.

"Since we started in Scotland we've got about 250 customers," he said. "It's quite a vibrant area with lots of customers."

The company has been targeting businesses in the central belt in particular, launching the PremierSortFlex service for businesses that send more than 250 letters and parcels a day. Corporate clients include Bank of Scotland.

However, Wells said the company had no plans to support the struggling Post Office network in Scotland, which will see up to 30 branches closed or downgraded this year.

Postcomm, the postal services regulator, recently urged private companies such as TNT Post, DHL and UBS to strike deals with the Post Office network over undelivered mail.

Sir Nigel Stapleton, chairman of Postcomm, said private operators could leave undelivered mail for customers to collect at post offices, rather than forcing them to trudge out to remote out-of-town depots.

But Wells said: "At the moment I think we're prevented from doing so by the contracts between Royal Mail and the Post Office. We therefore haven't looked too closely at that."