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Post Office proposals for its withdrawal from the external cash delivery market to improve support to its own branch network and reduce costs

Press release   •   May 17, 2016 17:11 BST

The Post Office today confirmed that it has entered into consultation with its unions and employees about changes to its Supply Chain operation designed to improve support for its branch network, reduce costs and continue its journey towards becoming a commercially sustainable business.

Supply Chain is the Post Office’s logistics operation that collects, delivers and processes cash, valuables and stock.

The business proposes to withdraw Supply Chain from the external cash transportation market, enabling it to focus on providing services to its 11,600 branches around the UK. This would see the closure of nine operational facilities and a reduction of 594 jobs during the current financial year. The plans are subject to a collective consultation with Unite and the CWU.

Supply Chain was originally established to service the Post Office branch network but for more than a decade it has also offered a cash collection and delivery service to a number of businesses across the UK.

Mark Ellis, Supply Chain Director, said: “In the course of the last three years, we have transformed over 6000 Post Office branches, making those businesses more sustainable for their communities, giving customers longer opening hours and improving the quality and efficiency of service.

“If Post Offices are to thrive in the future, we need to look at all aspects of how we operate, transforming our support areas as well as our branch network. Supply Chain’s core purpose must be to provide a cost-effective and reliable service to our branches and the communities that they serve.

“With downward pressure on prices due to competition from larger providers and the market for external cash-in-transit services gradually declining we believe that, in the future, our resources should be wholly focused on supporting our network.

“Our proposals would mean difficult changes for many colleagues working in this part of our business. As always, we’re committed to working with our unions to maintain our strong record for supporting our people through change.”

Notes for editors

  • Post Office is the UK’s largest retail network. Around 50,000 people work for 11,600 Post Office branches around the country. Post Office Ltd’s bottom line is steadily improving: last year, the operating loss before government subsidy was £60 million - almost half what it was in 2011/12.
  • Post Office Network Transformation is the largest modernisation programme in UK retail history, and the network now has more than 3,000 branches open on Sundays. The company is making substantial investments building its online presence and IT infrastructure, to support its leadership position in the mails market and grow its financial services brand, Post Office Money.
  • Post Office Supply Chain currently employs 1,338 colleagues across its 25 operational sites and support teams. It currently services about 1,000 external customers at over 11,000 locations, alongside the work it does to support the Post Office branch network.
  • Subject to the consultation, nine operational units would close under the proposals: depots in Preston, Stoke, Hull, Edinburgh, Inverness, Poole, Eastbourne and Dartford, and the coin operation at Merlin House in Birmingham. 

About the Post Office

The Post Office (Post Office Limited) has an unrivalled national network of over 11,500 branches across the UK, more than all the high street banks combined, and sits at the heart of communities in Northern Ireland, Scotland, Wales and England. The Post Office has made a commitment to maintaining its network of branches at its current size and reach. It provides around 170 different products and services spanning financial services including savings, insurance, loans, mortgages and credit cards; Government services; telephony; foreign currency; travel insurance and mail services.

The Post Office serves over 17 million customers a week and a third of small businesses. Some 99.7% of the total population live within three miles of a post office and over 97% live with one mile of a post office. For many rural communities, the post office is the only retail outlet. Post Offices branches remain highly valued and trusted, and are the focal point of many communities. For more information, visit

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