Royal Mail now only compensates cost price for businesses, is that allowed?

Grumpy_chap

https://forums.moneysavingexpert.com/discussion/comment/81950154#Comment_81950154

The hourly rate needs to be the business's input costs for time, not the sales rate.

soolin

This is not a new policy, RM have always only compensated the actual loss costs and never any profit element, it comes up a lot as an aside on the eBay board and even in the past month I have mentioned that I rarely claim for lost business items due to my low ‘cost’ price. You’ve probably just been lucky before.

it is an interesting point though whether ‘cost’ can include time. I have successfully in the past claimed for postage costs on a more expensive item where I submitted an original invoice with multiple items shown, but also an import and postage costs- and done a rather rough breakdown as to how much that worked out for the item that was lost, and that was paid.

dumpster_fire2025

https://forums.moneysavingexpert.com/discussion/comment/81949926#Comment_81949926

No, your hourly rate is effectively your profit which they've said they don't cover.

dumpster_fire2025

https://forums.moneysavingexpert.com/discussion/comment/81950056#Comment_81950056

If the wood is free then your loss is zero (at least in terms of what you've paid for the items.)

GDB2222

https://forums.moneysavingexpert.com/discussion/comment/81950166#Comment_81950166

You have asked your question on the consumer rights board. It’s worth noting that you are a business customer of Royal Mail and the usual consumer rights don’t apply.

If they are asking for invoices, I suggest that you send them the invoice for the last time you bought clay. Plus an invoice for the last time you bought glaze. Leave them to try to apportion the cost to the particular pottery item you sold. They may just give up and send you the amount you claimed.

A_Geordie

Royal Mail provides a clear explanation of their compensation policy online, with examples.

1. Where an item is lost or damaged beyond repair then actual loss is the amount it cost the customer to acquire, purchase or manufacture the item subject to condition, age and depreciation. Where an item is damaged it is the cost of repair. No additional payment will be made for the reduced value of the repaired item. If a customer has used one of the services set out in table 1 above, then any claim for compensation for actual loss will be paid up to the market value or the statutory maximum which ever is the smaller amount. Where Royal Mail Special Delivery Guaranteed by 1pm® has been used then any compensation for actual loss will be paid up to the smaller of market value or the compensation purchased by the sender. Below is an example of actual loss.

Mrs Smith (the end purchaser) bought a pair of jeans from a shop and paid £25 for them. If she posts them on and they go missing she can claim what it cost her to purchase the jeans, i.e. £25.

The Shop (the retailer) that sells the jeans buys them from the manufacturer for £15. If they post them and they go missing they can claim what it cost them to acquire the jeans, i.e. £15.

The Factory (the manufacturer) that supplies the shop makes the jeans for £10. If they post them and they go missing they can claim what the item cost them to manufacture, i.e. £10.

RM also offers additional compensation for consequential losses for an additional fee depending on the type of service your purchased, and that should pay out the gap between your actual loss and loss of profit. It would be wise to factor this cost into your pricing going forward, or use another courier that already offers compensation beyond the cost price. There are some companies that do offer delivery services for fragile goods, which may be worth investigating.

noitsnotme

I’ve had a Royal Mail business account for 16 years and they’ve always only paid compensation equivalent to my cost.

born_again

https://forums.moneysavingexpert.com/discussion/comment/81950247#Comment_81950247

No that is a cost to the buisness, for making a product or part. Not a profit.

Profit is what is made when all costs are taken into account & is what is left between costs & price charged.

Ectophile

How about setting up two businesses, each with its own bank account. One business makes pots. The other sells pots on the internet.

The second business buys the pots from the first one. If a pot goes missing in the post, then you can look at the accounts to see how much it cost the pot selling business paid for it.

Grumpy_chap

They'd presumably have to be two Ltd Co businesses so the costs and hassle might well outweigh the benefits for the occasional broken item.