Retailers face higher costs for direct marketing and customer communications after Royal Mail revealed plans to raise its wholesale postal prices by an average of 25 per cent.
The group will introduce the increases from 5 October, with some bulk-mail services rising by more than a third.
The changes will affect access-mail operators including UK Mail, Whistl and Citipost, which sort and process large volumes of post before handing items to Royal Mail for final-mile delivery.
These operators serve major businesses sending marketing materials, catalogues, bills and other customer correspondence, meaning retailers and consumer brands could face higher costs for letter-based campaigns.
The price of sending a letter weighing up to 100g through Royal Mail’s access business economy service will jump 36.1 per cent. The service is used for less urgent post delivered within five days.
Standard access advertising mail prices for large letters weighing between 101g and 250g will rise by 11.4 per cent.
The Mail Users’ Association described the increases as “unprecedented” and warned they would add significant financial pressure for organisations that rely on post to communicate with customers.
The changes could prompt retailers to review the scale and frequency of their direct-mail activity or accelerate the shift towards email, apps and social media.
However, physical mail remains an important marketing channel for businesses targeting customers who are less digitally engaged, as well as brands using catalogues, vouchers and personalised offers to drive store and online sales.
Royal Mail said declining letter volumes had increased the cost of maintaining its nationwide network.
Access-mail volumes have fallen by almost a third since the start of the decade, dropping from 6.3bn items in 2019/20 to around 4.2bn today. Meanwhile, the number of addresses Royal Mail is required to serve has increased to 32m.
The company said the new tariffs were needed to reflect the cost of providing a nationwide postal service amid rising fuel and labour expenses.
Royal Mail added that wholesale customers would continue to receive lower prices than consumers buying equivalent services.
The postal operator has recorded losses of almost £800m over the past four years and said its finances remained below the level Ofcom considers compatible with a sustainable universal service.
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