
Did you know the Royal Mail procurement function saved millions by buying cheaper bicycles? Yes, the organisation used to buy these really expensive models from the UK, with a very particular specification – some £350 a time (actually, we've seen even higher figures quoted).
But because of good work from procurement, they managed to get the price down to just £50 a time, saving a fortune. Sourced from China, of course. It must be a true story - this is what the BBC website said when writing about the savings track record of an Royal Mail ex-CPO during last year’s high-profile employment tribunal:
“This was partly achieved by procuring delivery bikes for postmen from China at £45 each, rather than paying £360 per bike in the UK”.
Hang on a minute, that can’t be right. Here is Supply Management in a recent article featuring another ex-Royal Mail procurement executive:
“…. his team saved in the region of £300m over three years. “It’s not always the biggest deal; sometimes it’s the thing that demonstrates lateral thinking and creativity,” he says. “The phrase ‘we’ve always done it like that’ is a dangerous thing.” He gives the example of the bicycle used by postal delivery workers: “It was specified to the nth degree – the gears, the tyres, the braking distance… As a result, it cost £300 a bike, when you could buy a higher quality one from offshore for about £50. That was a real symbol of what we were trying to do…”
But I’m sure I can remember another Royal Mail CPO claiming credit for the bicycle savings? Oh well, what’s that old expression – a good idea has many fathers?
Yet the paradox is this. Perhaps it wasn’t that smart an initiative anyway. The European Commission has pursued anti-dumping regulations against China for some years now, claiming unfair subsidies are given to their bicycle manufacturers. Meanwhile, what did taking the business away from a UK manufacturer do for local UK industry? How many bicycle makers ended up on benefits, costing the taxpayer millions?
And were the Chinese bicycles made to the highest ethical standards; are we sure there was no “modern slavery” involved, for instance school children forced to work during their holidays (as we know has happened in their electronics industry).
Yet a quick bit of Googling throws up another interesting question – did Royal Mail ever really buy bikes from China? Because cycles were phased out from 2009 to 2014 in favour of a combination of vans, hand-pulled trolleys (made in China?) and shoe-leather. So if procurement did put a lot of time and effort into re-specifying and sourcing bicycles from China, was that actually a waste of time and money in the end?
Anyway, the Royal Mail bicycle story has clearly earned its place in procurement mythology. But who was responsible and whether it was a fine bit of work, misguided or just a waste of time remains a bit of a mystery.
I really doubt “higher quality from offshore for about £50”
Cyclists call them “BSOs” when they are being polite.
https://bicycleshapedobject.wordpress.com/hall-of-shame/
Of Course it maybe (like the Jeep).the expect lifetime of the bike is pretty short anyway..
Nonesense
Interesting footnote
https://elephantbike.co.uk/about/