Tuesday, September 19, 2006

Stamping out the licking habit

I was just catching up on some news and I came across this from the BBC.

In summary the Royal Mail allow you to print a barcode that represents the stamp value and pay for it online.

Think of it as prepaid franking....

They are targeting the work from home and eBayers to try and assist them and to try and reduce queues in the post office.

Given that the letter business has been unraveled and that the distribution side of the Royal Mail, according to the BBC, made an annual profit of ~350M with the post office counters business losing 2M per week I would like to see more granularity behind the costs.

The actual distribution costs don't change because of this model but the cost of sale for consumable does. I don't know how much they pay for paper, glue, ink etc. for the stamps but based on some analysis I have done here the printing and postage costs of today's large operations, say a telco, make up the bulk of the cost and it is fairly fixed. There's not a lot of meat on the bone to pare away, you have to send the bills out somehow.

The solution for me then was the equivalent of the Royal Mail's idea, get the customer to pay for the paper and the ink. For me it was a fax server and fax them or email them the bill. They can print it off and take the hard copy for reference or to pay against. For the Royal Mail it's get the sender to print a bar code to fix to their package or letter.

It's not a new idea, this has been a growing trend in cinemas for some time. Showcase cinemas in the UK allow you [for some theatres] to print the ticket off and bring with you once you've successfully been through their online payment system.

I wonder what will be next, go to McDonalds and cook your own burger. Based on my most recent experiences here in Thailand that would be a good thing, at least you'd get it all at the same time :)

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