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WORLD CLASS SUPPLY CHAIN

John Hornby – CEO – The Lettershop Group

Tim Cable - Head of Media Products – Royal Mail

Jan Challis – Quality & Service Integrity Director – Royal Mail Logistics

The Strategic Mailing Partnership™ supported by Royal Mail

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•Context

•What are Royal Mail currently doing

•What is SMP currently doing

•What do you think we should be doing

20 mins

20 mins

Agenda

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Context

What is the problem we are trying to solve?

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What does our market look like at the moment

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What does our market look like at the moment

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What does our market look like at the moment

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The Opportunities

• Re- energise Direct Mail in an increasingly Digital World

Bigger share from existing users

Channel of choice for printed material

More businesses into the Medium

• Keep Paper Relevant in Transactional mail

Investment or Cost

Part of the Customer Relationship

8Source: Insight Exchange, SME customer understanding (2010)

Base: 146 Sophisticates

74%

35%

33%

25%

20%

19%

16%

5%

It’s expensive

It takes too long

I think it’s bad for the environment

It's difficult to get right

It hasn’t worked for us in the past

It’s not flexible enough in terms ofplanning and booking

Customers don't like it

We’ve never really considered it

Barriers to making more use of Direct Mail

We did some research with SMEs

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The Barriers to Direct Mail

1. Difficult to use 79

2. Expensive 74

3. Environmental 33

4. Doesn’t Work

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5. Recipients don’t want it

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74%

35%

33%

25%

20%

19%

16%

5%

It’s expensive

It takes too long

I think it’s bad for the environment

It's difficult to get right

It hasn’t worked for us in the past

It’s not flexible enough in terms ofplanning and booking

Customers don't like it

We’ve never really considered it

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• Promoting Mail as a Communications Medium

• Redesigning our Product Portfolio

• Focus on Customer Experience

• Challenging our Regulatory Framework

• Investing in our Network

• Ensuring our Colleagues are up for the challenge

What is Royal Mail Currently doing about it

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What is SMP Currently doing about it

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• Learning so far:

• Mutual view of processes, how and whether they work, and an understanding of common faults.

• Involvement of people most affected by issue is best way of solving/influencing the outcome.

• Cultural change: Employees appreciate they can influence outcomes, when it may appear rules and compliance reign.

• Great way to communicate

• Kaizen is a continuous process that will improve the relationship

What is SMP Currently doing about it

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Practical matters:

Agreed to use Lettershop designed version of CCR to improve documentation flow

Agreed to accept emailed Sales order, so long as received by 1700

DVD training session on CBC/OCR DVD delivered to Lettershop employees.

Many questions from Lettershop employees answered face to face

What is SMP Currently doing about it

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What do you think is necessary to tackle the ‘difficult to use’ barrier, through demonstrating a World Class Supply Chain to current and prospective mailers?

We would really like to hear yor views

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Thank you