Internet business slams new Royal Mail delivery surcharge

Former editor, BusinessZone
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The introduction of a new fuel surcharge for Royal Mail business customers has angered the director of a small internet company. 

From today, Royal Mail is applying a 2.5% fuel surcharge for contract parcel products.

On its website, the company says: "The application of a fuel surcharge is established practice in the parcels delivery market. Royal Mail has until now included these costs into the overall parcel price. This will bring Royal Mail in line with other parcel delivery companies who already apply a fuel surcharge."

But Ruel Taylor, operations director at phone accessories company Mobile Fun, criticised the changes as impacting disproportionately on online retailers.

"We recognise that Royal Mail is undergoing a period of change and undertaking cost saving initiatives," he said. "However, during a recession, it is unfair that loyal business customers and consumers should have to shoulder additional costs for the same services.

"If Royal Mail is to remain competitive in the long term, it must evaluate its relationship with the growing online retail sector. Every year online businesses brace themselves for Royal Mail price rises, which are frequently above the rate of inflation.
"This year we are being hit by rising costs across the board, starting with Royal Mail introducing a 2.5% fuel surcharge on deliveries. Although we receive a volume discount on Royal Mail delivery services, the addition of fuel surcharges will effectively nullify this discount.
"With the new Royal Mail pricing structure, it will become a daily battle for online retailers to keep costs down without compromising customer service and delivery times.
"Many businesses, like ours, simply do not have sufficient margins to continue offering next day delivery at an affordable low price for our customers. We have no choice now but to begin offering our customers cheaper and therefore slower delivery services, which is a bitter pill to swallow.
"We urge Royal Mail to reconsider its pricing structure and try to accommodate the needs of its business customers. We would like to continue to support Royal Mail but the increasing costs involved mean that we must consider alternatives, to continue offering best value for money to our customers."


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