Independent retailers face uncertainty over the crucial festive period as strikes by Royal Mail threaten Christmas deliveries.
Proposed strikes by Royal Mail workers will have a deep impact on independent retailers that rely heavily on its services. Indies are also likely to incur additional costs by switching to an alternative carrier to guarantee deliveries.
As Drapers went to press, an initial strike, led by the Communication Workers Union, was planned to take place on October 22-23, but retailers feared that if disputes were not settled, further strikes could lead to a continued backlog in deliveries as the Christmas rush sets in.
Kyle Salt, owner of young fashion indie Freedom Clothing in Portadown, Northern Ireland, which uses Royal Mail’s next-day delivery service, said: “We are worried about the length of these strikes and how they will affect our customer service, as we don’t have a plan B at this stage.”
Etail industry body IMRG has urged retailers to seek alternative carriers and to put clear instructions on their websites detailing any expected delays to deliveries and updating returns policies during the strikes. IMRG director of operations David Smith said: “Our latest research shows that 86% of retailers use the Royal Mail but that figure is higher in the independent sector.”
He added: “Independents should be putting a contingency plan in place, but it will be hard to negotiate deals at the moment if delivery levels are comparatively small.”
Some indies are already setting up contracts with alternative carriers. Designer indie Sunday Best in Rawtenstall in Lancashire uses Royal Mail but has signed courier company UPS as a back-up.
Fiona Mulderrig, who runs the store’s website, said: “This will cost £2 to £3 more per parcel but we will stand that cost, not the customer.”
Steve McEvoy, partnership and SME sales director of Metapak, which runs a software programme that helps retailers place deliveries with the most cost-effective carrier, said: “During strikes, some of our members have asked us to provide an alternative carrier such as Parcelforce. Obviously this will cost them more but they have decided that offering consistent levels of business service is worth it.”
Indies have also acknowledged they would have to extend the time period for returns, which could result in them receiving excess stock late in the season. Salt said: “We give 14 days; that may have to double.”
Confidence in etail
Statistics from Capgemini and IMRG on etail growth in September 2009 found that:
- Year-on-year etail sales growth was at a record low of 7.6%
- Month-on-month growth of 1.9% was unusually low for September
IMRG attributed this slowdown in growth partly to postal strikes deterring online shoppers.
Royal Mail action
As Drapers went to press the Royal Mail had offered to approach the conciliation service Acas to discuss its modernisation plans if the Communication Workers Union called off planned strikes. The carrier has also employed an additional 30,000 temporary workers to help keep mail moving during the strike.
Royal Mail group chief executive Adam Crozier said: “We are continuing to urge the union to halt its appalling and unjustified attack on customers.”