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Massive Royal Mail Stamp Price Hikes Announced



In percentage terms the prices of the two basic letter services are rising by 30 percent for 1st class and 39 percent for 2nd.

Naturally the headlines today are focusing on the basic 1st and 2nd class postal services but there are also some significant changes to the cost of large letters, packets, premium inland mail services and overseas deliveries.

One major change affects the cost of sending small packets. Currently these are priced in four weight bands up to 750g starting at £1.58 1st class and £1.33 for 2nd class. With effect 30th April the four weight bands are being merged in to one spanning all packets weighing 0-750g costing £2.20 (2nd) and £2.70 (1st). This represents an increase of more than 70 percent for packets under 100g. I fear the future prospects for kitchen table sellers on eBay aren't looking great.

Royal Mail has been consistently blaming falling demand for its woes in recent years as customers have switched to free and low cost electronic communication services and business mail services have been opened up to increased competition. So it seems the plan now is to give up even trying to increase the mail volumes handled and look to dramatically increase margins on lower mail volumes instead. Leading toward privatisation it looks to me as if lower mail volumes will allow significant further operating cost cuts which will compound the benefit of the increased margins creating sufficient trading profits to justify and encourage private ownership.

From the stamp collecting perspective it's difficult to see how these price increases for future issues wont cause the abandonment of many British stamp collections. Will Royal Mail try to keep collectors interested by opening up the special handstamp services to covers bearing second class stamps? Will they include a second class stamp instead of a high value in future commemorative issues? Will they steer away from special issues comprising of ten stamps or more? I fear they wont consider such steps and the resulting drop in demand could well impact on the viability of producing special stamp issues altogether in future.



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