2012 PacketPost Prices

[Mike Hughes]

Only really looked into this now. Has anyone else noticed that the new PacketPost prices for Packets from April will get rid of the bands for < 100g, < 250g and < 500g and everthing under 750g will now be at the new 750g rate?

Quite an increase for me. Generally my post went out at the < 250g rate so I'm looking at a 32% increase in postage costs this year.

Mike

[Golf Tee Warehouse]

Yes, Nit sure whether the same price bands will also apply to non packetpost mail, ie. post office or account customer on standard account rates. If it doesn't packetpost will be a disadvantage to many sending under 500g on average.

The other big change to Packetpost will be the addition of 20% VAT, which will be another big increase for those not VAT registered.

[tdw]

The 750g rate will affect me, most of my average parcel weights were under250 and 500g plus the addition of VAT

Not VAT registered yet so I will be 20% out of pocket.

[Golf Tee Warehouse]

If you are a business using Packetpost and not registered for VAT posting 1st class packet weighing under 100g on avergae (unlikely) you would be seeing a 97% increase in your postage costs.

If your average is 500-750g and use 2nd class the price has actually reduced by 6.4% until VAT is added.

If you send a mix of 1st and 2nd class you may be able to manipulate the average weights by upgrading some packets from 2nd to 1st class.

TDW looks like you are facing increases of 35% (2nd class) or 44%-58% (1st class).

For those who are not VAT registered you may need to work out if it is worth switching away from packetpost back to normal 1st and 2nd class mail as Royal Mail have stated:

We are introducing a new account payment channel for our 1st Class and 2nd Class mail.
Similar to the 1st and 2nd Class products offered via the stamps, online and franking payment channels,
we will not offer any discounts for quantity / volume or presentation. This means the new account
product will remain VAT exempt.
The product will be introduced on April 2nd to offer an alternative to other account services that
become VAT rated on this date. The product will initially adopt the previous year’s prices for Standard
Account mail until the final Ofcom decision on the new regulatory regime for postal services is known.
We will then announce a price increase to take effect in mid-to-late April to ensure the 1st and 2nd
Class account prices are increased in line with other USO services paid via franking and stamps.

I have attached a file showing the price increase for Packetpost for anyone interested.

[Mike Hughes]

Yes, Not sure whether the same price bands will also apply to non packetpost mail, ie. post office or account customer on standard account rates. If it doesn't packetpost will be a disadvantage to many sending under 500g on average.

Yes, the same price bands will apply. As Darren says RM are trying to create an account level to save non VAT registered customers from VAT but have published the old rates (which do still have the lower weight breaks) until they get approval for the new account level (and confirmation of the VAT status). As soon as it's all sorted the actual prices will be published in line with all the other rates.

For Post Office customers, the cost for packets will be £2.36 (plus VAT) up to 750g.

Mike

Edited to add (plus VAT)

[Golf Tee Warehouse]

Thanks Mike,

Were did you find the proposed non-business 2012 prices, I looked around and couldn't find any.

[Mike Hughes]

I could only find the full price list after logging into oba. There's a link on the page as soon as you log in.

Mike

ps. I believe the standard packet cost is £2.36 plus VAT.

[saucysal]

This changes things for us

We have been sending the lightest packages by PacketPost First Class Recorded as this was cheaper than our other carriers. We will now have to review this, and may end up sending very little by Royal Mail (just packages going outside the EU and to UK offshore). The problem with this is that they will stop the free collections if our turnover with them is less than £15,000 per year.

We had already stopped Royal Mail Tracked when they doubled the price per package overnight, last year.

While the Royal Mail are trying to get more in line with other carriers, they are losing what made them useful in the first place. They will end up being just another carrier.

Sarah

[Mike Hughes]

I think the whole delivery sector is going through an upheaval at the moment. There have been too many carriers and prices have been driven down to chase customers.

City link lost more than £30M last year on about 50m packages and haven't made a profit in the last 4 years.

One of the things the head of the parent company said recently was:

Pricing has also been a problem, but this has affected the whole industry and several couriers are planning to put up prices in coming months following years of serial decline.

Whether the couriers can make any price rises stick is a big question.
The problem they have is that there are too many of them chasing the business and their services are esentially the same. So they end up competing on price. It just takes one courier to break ranks and cut prices and they all have to follow them down.

Mike

[tdw]

So price rise confirmed then.

[Mike Hughes]

Hmm. So, OBA prices went to the new price scales on 2nd April but smartstamp and other non-contract services don't change until the 30th April.

Anyone care to guess how I'll be sending most of my parcels this month?

Mike

[Golf Tee Warehouse]

As a non VAT-registered company I have moved my large letters from Packetpost (which now incurs VAT) to the new non VAT OBA 1st/2nd class service using code BPL. The prices are lower than SmartStamp/Post Office but will rise on 30th April, at which point the benefit over Packetpost is much lower.

I am still using Packetpost for packets as the price with VAT is still lower for me.

[fleetwood]

It looks like the lower weight bands still exist for PacketPost Large Letters, even though they have indeed gone for Packetpost Packets. With price caps removed/eased, RM pretty much have price freedom at the moment, as I do not know of any other carrier that offers packet delivery of any size at the £2-£3 mark, for relatively small (5,000pa) volumes.

[eezytrade]

I'll be switching from packet post for now, as most of our items are around the 250gm size.

This price increase is just another move towards privatisation of RM, in my opinion. Their prices will continue to increase until they come near to any other courier service, at which point they'll be sold off.