PostNord and Royal Mail

When we look at the numbers in the chart below, we can say that barring an event that makes digital communication impossible, the continuing trend of fewer and fewer letters being sent and delivered in the UK is inevitable.

While specific per capita figures for each year are not readily available, we can estimate these values using total letter volumes and population statistics.

YearTotal Letter Volume (billion)UK Population (million)Letters per Capita
200020.058.9339
200519.760.4326
201016.062.8255
201512.065.1184
20208.067.1119
20246.768.298

So when does it become untenable to deliver letters at all?

PostNord, Denmark’s state-run postal service, is in the news. It will end all letter deliveries at the end of 2025 because since 2000 there has been a 90% decline in the number of letters sent.

Some news outlets are asking when the same will be true in the UK.

Denmark, has a population of about six million. The number of letters sent has fallen from just 1.4bn in 2000 to 110m last year. That’s a drop of over 230 per person in 2000 to 33 last year.

And there will be those in Royal Mail who want to use the figures from Denmark to bolster their own agenda to cut letter deliveries in the UK.

And that is precisely where comparisons between countries fail. What might not be viable when the total number of letters is 110 million might be completely viable when the overall number of letters sent is 6.7 billion as it is in the UK.

There’s another point. The Spanish newspaper El Pais reported that the Transport Minister Thomas Danielsen said it will be up to the Ministry of Transport to decide, perhaps by tender, who will be in charge of this task in the future, ensuring that postal services continue across the country.

Does it mean that the Danish state-run postal service expects that private companies will come to fill the void? Why would that work when the very reason that the state-run postal service is closing is because they can’t make it work?

But again, that is Denmark. We are already past that in the UK and have been since Royal Mail went fully into private hands in 2016.

To fill in the picture of how Royal Mail passed into private hands after 500 years of public ownership:

In 2013 the UK government sold 60% of its ownership through an IPO on the London Stock Exchange. Two years later is sold a further 30% and a year after that is sold the rest of its ownership.

And now the whole shebang of Royal Mail is owned by International Distribution Services (IDS), which in turn is owned by Daniel Křetínský through his investment vehicle, EP Group.

Why do they keep the name ‘Royal’ in the title?

If it is because of the terms of its licence that require it to deliver mail, then the economic reality is that, as I started this article saying, barring an event that makes digital communication impossible, the continuing trend of fewer and fewer letters being sent and delivered is inevitable. And then public or private, letters will not be sent or individuals will use multiple private delivery services.

But we are not there yet. Want to predict a date? How about 2030?

Oh, what about letters being sent abroad or being sent from abroad? Now there’s a question.