Thursday, 8 October 2009

Royal Mail v the CWU: misconceptions and misdemeanors

News that the Communication Workers Union (CWU) had voted to strike against Royal Mail raced through the ECMOD conference like Caster Semenya after several cups of Red Bull-spiked cappuccino. That’s no surprise, given that just about everyone attending ECMOD--the UK’s annual conference for cataloguers and other direct sellers--would be affected.

A few talking points:

* Reports that three-quarters of CWU members voted to strike are erroneous. Yes, 61,623 out of 80,830 members voted in favour: 76.2 percent. But 121,000 members were balloted; 40,170 members did not vote. Many observers say that in union votes, members who abstain tend to disagree with the union leadership but fear casting an opposing vote. In other words, of the one-third of members who did not vote, the majority are likely to be against a strike. But even if you don’t want to make that assumption, the fact is that only 51 percent of the CWU members voted to strike--hardly a mandate. And that doesn’t even take into consideration the 20,000 postal workers who, according to Royal Mail, aren’t even CWU members.

* Mainstream media outlets are rushing out with articles offering alternatives to Royal Mail. But while alternative parcel carriers exist--and direct marketers will no doubt be hearing from them in droves--no viable options exist for getting catalogues and other print marketing pieces to customers and prospects. The Wednesday morning ECMOD session “Mail and Parcel Options--The Lowdown”, featuring a panel of carriers and consultants, was in fact misleadingly titled.

Panelist Andrew Goddard, national sales director of TNT Post, which provides downstream access (DSA) services into the Royal Mail mail stream--drop-shipping post so that Royal Mail is responsible only for the proverbial “final mile”--emphasised that cataloguers that avail themselves of DSA services would get their catalogues delivered faster in the event of a strike than those that don’t, because their post will be that much closer to their final destination. But when I asked the session participants point-blank, "What alternatives for catalogue delivery can any of you offer should there be a Royal Mail strike?" they had to admit that there were none. As Graham Cooper, managing director of postal solutions provider Onepost, said, “There’s no magic solution if there’s a mail strike.”

(As an aside, TNT’s Goddard said that his company is working toward unveiling next year an end-to-end service that would include final-mile delivery to about 50 percent of the country.)

* Cataloguers aren’t even certain what contingencies to plan for. Numerous mailers that rely on Royal Mail to deliver some or all of their packages are busy contacting independent carriers. David Price, managing director of multititle mailer Foot Shop, uses Royal Mail to deliver parcels for its Cosyfeet catalogue. Another of its brands, Walk Tall, uses Parcelforce, so Price can shift its Cosyfeet volume to Parcelforce relatively simply. Other companies may have to work harder to find alternatives, however. Parcel carriers have only so much capacity, and cataloguers, particularly smaller ones, might not be able to negotiate terms as favourable as those they have with Royal Mail.

As for their catalogue mailings, in what for the vast majority of business-to-consumer merchants is the critical selling season, the fact that it’s not yet known where and when the strikes will occur makes planning that much trickier. Most at ECMOD assumed that the CWU would conduct 48-hour rolling strikes at differing locations and facilities as it had during the strikes of 2007, rather than a simultaneous nationwide walkout. So should they go ahead with their holiday campaigns and hope that the catalogues arrived in homes eventually--the old “better late than never” philosophy? Should they reduce circulation? Eliminate entire mailings? Graham Winn, owner of gifts mailer Flowercard, said he was “looking at potentially cutting our risk by reducing our acquisition plan”. Unfortunately he’d been planning a big prospecting and sales push for Christmas, so that sales for the season would exceed turnover for all of last year.

* Attendees were hugely sympathetic with Royal Mail. Cataloguers rarely hesitate to criticise Royal Mail. But at ECMOD nearly all of them vented their spleen toward the CWU and sided with Royal Mail and its modernisation efforts. (We'd already done so, pretty much calling CWU leaders a bunch of babies in a post last month.)

Interestingly, two of the panelists at the session “UK Brands Taking the USA by Storm” compared the US Postal Service unfavourably to Royal Mail, with Long Tall Sally chief executive Andrew Shapin calling USPS “a total nightmare” because of its sluggishness and unreliability. If Royal Mail can take any consolation in the ongoing follies, it’s that mailers are finally beginning to show the organisation some love.--SC


  1. Fascinating insight into the background of the strikes. Mind if I cross-post to

    It's a new forum for news and comment about Royal Mail.


  2. Yes, feel free to post this (so long as you credit/link us). Cheers!