Royal Mail could deliver letters just three times a week as the regulator will help the company to have a more sustainable service.
Ofcom has said their consultation is to start a “national debate” to discuss the future of the British postal service.
The watchdog has said that there has been a decline in letter volumes and costs have risen, they are discussing to reduce the service from six to five days or even just three times a week.
Ofcom said this “would require government and parliament to change primary legislation,” and the aim is for Royal Mail save up to £650 million.
Following news that Ofcom would allow Royal Mail to end Saturday post or allow deliveries to take place on alternate days, Federation of Small Businesses (FSB) Policy Chair Tina McKenzie said, “Trading essential services for short-term savings is a slippery slope that may compromise the trust small businesses place in Royal Mail. Considering that 25 per cent of them rely on the postal service, these proposals could cause real disruption to our economy.
“They will not just impact the householder waiting for birthday cards or hospital appointments. Many have built their business operations around the postal service, from the cake seller who needs to send a last-minute topper to letterbox flower companies which rely on next-day deliveries.
“These sellers are in a routine and knowing they can deliver things quickly allows them to build a positive relationship with their customer. Similarly, it will also affect the customer who prefers to schedule deliveries on a Saturday when they will be home to sign for it.
“This will also affect those dependent on supplies through the post. If a self-employed carpet fitter doesn’t get their materials on time, they can’t fulfil their order. Similarly, a jeweller who doesn’t receive metals regularly will struggle to meet their targets. Other couriers charge up to 200 per cent more than Royal Mail to send the same item, and many small firms cannot afford to swallow that extra cost.
“This all comes at a time where our Small Business Index (SBI) shows retail confidence plunged to -29.8 points in the last quarter of 2023, a fall from the -22.8 points recorded in the last period. We cannot afford to take anything away from the sector.
“Traditional office-based firms are at risk too – business rates reminders, for instance, are rarely sent electronically. For firms in rural areas, the risk of a sporadic postal system is far greater, with 32 per cent reporting issues with the reliability of their broadband. They will lean on the postal service more than their urban counterparts, and letters arriving late can have unfair consequences.
“All of these firms have already had to handle Royal Mail cyber-attacks and strike action, highlighting how fragile the post system can be. Trimming things back is not the way to make improvements. Regular post is something deeply integrated into the nation’s routine and Royal Mail is a true British institution. It’s understandable that the overall number of mail volumes has fallen in recent years, but the number of small businesses relying on it has not.
“The answer, therefore, lies in modernising a service designed in the 1970s to fit the needs and expectations of today’s culture in a sensible way, that doesn’t leave small firms feeling short-changed.”