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The £21m Fine: It’s Not Their Loss. It’s Your New Invoice.

The £21m Fine: It’s Not Their Loss. It’s Your New Invoice.

 

Let’s strip away the corporate gloss. Ofcom has slapped Royal Mail with a £21 million fine for missing their delivery targets by a country mile. Do you genuinely think that money is coming out of shareholder dividends?

In the corporate world, fines are just another line item in “Operational Expenditure” (OpEx). And OpEx is always—without fail—passed down to the customer. While the press release is busy “apologising,” their finance directors are already recalculating your rate card for April.

Here is what their excuses actually mean for your bottom line:

1. The Trap of “Financial Sustainability”

 

  • The PR Spin: “We must reform the Universal Service Obligation (USO) to secure our future.”

  • The Insider Reality: They are legalising failure. The fine happened because they only delivered roughly 77% of First Class post on time against a 93% target. Their solution isn’t to fix it; it’s to lower the bar.

  • Your Cost: You are paying “Premium” rates for an “Economy” service. If you rely on First Class for invoicing or legal notices, prepare for cash flow gaps. Your post simply won’t arrive when you need it to.

2. “Modernisation & Efficiency”

 

  • The PR Spin: “We are accelerating automation to streamline processing.”

  • The Insider Reality: This means stripping out the experienced posties who knew your local route and replacing them with rigid sorting machines. When the tech fails (or “exceptional weather” hits), there are no humans left to clear the backlog.

  • Your Cost: A spike in “Claims Management” hours. The time your admin team spends chasing “Where is my parcel?” is a hidden wage cost you need to budget for immediately.

3. “Improving Quality of Service”

 

  • The PR Spin: “We are investing to regain trust.”

  • The Insider Reality: Failing on the basic tariff is a strategic way to force you to upgrade. Since First Class is now unreliable, the only way to guarantee delivery is to switch to Tracked 24/48.

  • Your Cost: Forced Upselling. You are being technically coerced into moving from standard PPI/stamps to Tracked services, which cost 30-40% more, just to get the service level you used to have.

How to protect your P&L (Before the Price Rise Letter lands)

 

Don’t wait for the new financial year. Move now:

  1. Stop using First Class: For B2B, this product is effectively dead. Either downgrade to Second Class (if time allows) or pay for Tracked. There is no middle ground anymore.

  2. Diversify Carriers: If you give 100% of your volume to one carrier, you have zero leverage. Open an account with DPD, Evri, or Yodel immediately as a “Plan B”.

  3. Audit the Surcharges: Read the small print on your next contract renewal regarding “Fuel Surcharges” and “Green Levies.” That is exactly where they will hide the cost of this £21m fine.

Want to check if you are overpaying?

I have developed a “5-Step Postal Cost Audit” for my private clients. It cuts through the noise and shows you exactly where your current rates are bleeding margin.

I am happy to share this PDF with readers of this site who want to run a quick self-check on their tariffs.

To get a copy, simply drop me an email at av@procurepartners.co.uk with the subject line “CHECKLIST”, and I will forward it directly to your inbox.