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Until the late nineteenth century the carriage of parcels was in the hands of 'carters' or carriers, operating on a local basis. With the improvement of the roads in the eighteenth century and the inception of the railway services in the late 1820s, the volume of parcels conveyed by coach and railway increased. By the 1850s railway companies had cornered the bulk of this business. In 1842 Rowland Hill suggested that a parcel service should be operated by the Post Office. However, the government was content to let this business remain in the private sector, for the time being. By the 1860s the population explosion and dramatic expansion of British commerce and industry gradually forced the Post Office to give some thought to parcel post. A plan for the introduction of a parcels post was suggested in the 1860s by Rowland Hill and Frederick Hill, (Rowlands' brother and Assistant in the Postmaster General's Office).

The establishment of the General Postal Union in 1874, (now known as the Universal Postal Union) led to further discussions. In 1880 the union promulgated a convention for the exchange of postal parcels between Germany, Austria-Hungary, Belgium, Bulgaria, Denmark, Egypt, Spain, France, Great Britain and Ireland, British India, Italy and Luxembourg. This envisaged the transmission of parcels up to 3 kilograms in weight. A convention was signed at Paris on 3 November 1880, due to come into operation on 1 October 1881. A protocol attached to this convention took note that Great Britain, Ireland and British India were not in a position to sign the convention as they did not have an inland parcels service at that time, and they were accordingly given until 1 April 1882 to bring the convention into effect.

On 11 February 1882, Henry Fawcett, Postmaster General, assisted by Frederick E Baines, Inspector General of mails, and Sir Arthur Blackwood, Secretary to the Post Office, submitted a memorandum analysing the various problems preventing the introduction of an inland Parcel Post service and suggesting ways of overcoming them.

An Act to amend the Post Office Acts with respect to the Conveyance of Parcels (45 and 46 Vict. Ch. 74), was passed by Parliament on 18 August 1882. Twelve of its seventeen sections dealt with matters arising from the negotiations between the Post Office and the railway companies; their remuneration and the services to be rendered by them.

The Inland Parcel Post came into operation on 1 August 1883 and 'letter-carriers' were entitled 'postmen' as a result. From 12 August 1884 the service was known as the Parcels Post. Parcels sent by the Post were limited to 7lbs in weight and the rates of postage ranged from 3d for 1lb to 1s for 7lbs.