The restructuring of the package delivery arm of the postal operator Parcelforce -- part of a wider overhaul at the Royal Mail aimed at stemming its 拢1.5m a day losses -- is being blamed for having a domino effect on the rest of the industry.
Parcelforce is now concentrating on express deliveries and its basic parcel services for domestic customers. It will abandon its declining and unprofitable portfolio of three-day-plus delivery products.
However, Parcelforce is said to have been so overwhelmed by the number of its clients who upgraded to its more expensive services that it cancelled some of its less profitable contracts in August with as little as 14 days' notice.
Some have moved to rival services such as Parcelnet, Business Express and GUS's Reality, but they are now having to turn away business because they can not cope with the demand for deliveries in the run-up to Christmas.
Parcelforce is also expected to struggle to fulfil customers' deliveries in time for Christmas.
Royal Mail so far rejected the reports, saying it is "geared up for Christmas and fully expects to deliver service of the highest quality".
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