Mail Franking: You're Helping Royal Mail Compete

Mail Franking from Royal Mail

When Royal Mail was first established in the early 16th century, it was a public entity created to serve the public good. Its function as a public entity continued uninterrupted until 2011, when the government offered Royal Mail shares on the London Stock Exchange. It is now a separate business entity free of government ownership; an entity you are helping to compete by using your Royal Mail franking machine. 

As an independent business entity, Royal Mail now has to compete with other similar organisations for letter and parcel delivery. The company is divided into two primary subsidiaries known as Royal Mail Group Limited and Parcelforce Worldwide. The former handles domestic letter delivery while the latter handles global parcel delivery. A third subsidiary, known as General Logistics Systems, aids the other two by providing logistics support.

So, what does this have to do with your Royal Mail franking machine? Everything, actually.

Royal Mail has traditionally relied on letter service to generate the bulk of its revenues. But letter volume has fallen in the UK thanks to so much business now being conducted online. The decline has been so significant that Royal Mail has had to make up its losses by competing more aggressively in the worldwide parcel space. Every time you use your franking machine, you are generating revenues Royal Mail needs to compete.

Mail Franking - Revenues by the Numbers

The Telegraph reported this past May (2017) that Royal Mail's annual profits were up 25% last year. Total revenues from worldwide parcel delivery were up 9% while the domestic letter business was down 2%. Nevertheless, total revenues for the year increased from £9.25 billion to £9.78 billion, increasing total profits from £267 million to £335 million.

Just like your company, Royal Mail needs a steady stream of customers to fund its growth efforts. Royal Mail has had to greatly expand its overseas parcel business in order to make up for the drop in domestic letter service, but as a loyal customer, you are helping by providing funds necessary for Royal Mail to continue that ongoing expansion.

You may not think of mail franking as a way of helping Royal Mail compete, but it does help nonetheless. At the same time, your company benefits as well. If you are using a recent model franking machine, you are getting the best possible price along with a host of additional features that make your mail room more efficient and accurate. What's not to like about that?

Next time you use your Royal Mail franking machine, just remember that you are supporting a company that has been continually active in Britain since 1516. You are helping to support a company that has provided unparalleled letter and parcel service in the UK for hundreds of years. Furthermore, every time you use your franking machine, you are contributing revenues that are helping Royal Mail expand its business overseas. You are part of keeping one of the UK's longest running companies in business.

Sources:

Telegraph – http://www.telegraph.co.uk/business/2017/05/18/royal-mail-relies-international-business-letter-deliveries-fall/

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