Royal Mail to target footwear and apparel deliveries ahead of expansion

The Royal Mail has its sights set on working more closely with clothing and footwear retailers and deliver heavier packages, as the company fights for it's share of the UK parcel market from a growing number of contenders.

According to the Royal Mail trading update, the UK parcel division oversaw the delivery of 120 million packages last month, a 4 percent increase from a year ago. "Royal Mail delivered one of its highest ever quality of service performances for parcel delivery to our customers over the month," said Moya Greene, chief executive officer for the Royal Mail.

"This is because we started to plan for Christmas in April [and] as a result, Royal Mail was able to provide customers with reliability, flexibility and high quality delivery at a competitive price." Revenue for the parcel division was flat during the first nine months of the financial year, as an surplus number of delivery operators focuses on weighing prices.

“It’s still a pretty competitive environment out there,” added Greene in an interview with Bloomberg. “We've got too much capacity being brought on stream too quickly given the rate of growth in the industry.” As the largest UK postal service, Royal Mail has focused on expanding it's currently letter-driven delivery network to focus more on profitable parcel delivery as well.

Royal Mail offers customers and retailers "reliability, flexibility and high quality delivery at a competitive price"

Parcel volumes for the Royal Mail were up 3 percent during the first nine months of the fiscal year, driven by a number of initiatives introduced by the Royal Mail last year. The current growth witnessed in e-commerce has helped drive sales for the London-based firm, as more and more UK retailers realise the value their consumers place on flexible and trustworthy delivery services.

“There’s a halo effect that comes onto a retailer if they choose a high-quality delivery partner," noted Greene. Some of the new initiative Royal Mail has introduced to make sure they stand out as a quality partner for retailers include extended working hours, with a number of key office open on Sunday, additional drop-off points for deliveries and plans to extend the range of items it handles for delivery.

Group revenue for the nine months to December 28, 2014, increased 1 percent, minus changes in currencies, working days and one-off effects. During the Christmas trading period, the Royal mail opened 10 sorting subs and 19,000 employees on a temporary basis. "We have benefitted from the initiatives we introduced earlier in the year, successfully targeting new sectors of the market and benefitting from opening our network at the weekend," added Greene.