In the zone

Royal Mail is intending to apply to Postcomm, the regulator, for permission to price their bulk mail products zonally.

This would mean that large mailers would be charged different prices for their mail depending on where it was been sent. The measure is proposed to be delivery point density, which will in the main part lead to city centres being cheaper to mail to, whereas rural areas would become more expensive.

Before Postcomm will consider the formal application they must have sufficient information of good quality from Royal Mail which will clearly demonstrate that zonal pricing will be revenue neutral, cost reflective and not inhibit competition. This stage has yet to be reached, however when it is there will be a nine month timeline before Postcomm make a decision.

On first glance it seems that this system will disadvantage those in rural areas, however there may be a drop in the amount of unaddressed mail delivered to these areas – which some people tell us will be a benefit.

You can see the initial briefing on zonal pricing from Postcomm here