PO decline - where have all the parcels gone?

Industry insiders have debunked the theory that the courier industry has effectively killed the Post Office by taking over its small parcels business following the three-month PO strike last year. But it’s no myth that the PO is busy killing itself with a combination of on-going staff strikes, management malaise, poor productivity and ingrained inefficiency, said Garry Marshall, MD of Bidair Cargo and CEO of the SA Express Parcel Association (Saepa). “They face a fast-growing market, and should be growing like mad. But they’re just too inefficient,” Marshall told FTW. As for a switch from ordinary post to the courier/express service, he felt that this had been exaggerated. “There was a bit at the beginning (of the PO strike). But nothing noticeable. “What we found was that a lot of bodies, like municipalities, rented delivery vans to deliver their invoices. But very quickly they persuaded their client base to switch to e-mail delivery – and e-mail became the replacement for the post office.” As for the two delivery modes, they are, said Marshall: “Just poles apart.” For a start, he pointed out that the courier rate is 12 times that of the PO. “But for that you get the courier item electronically and physically tracked and traced through every link between consignor and consignee, with full records and proof of delivery. With the Post Office, you dump the parcel into a bin and there’s no record of its receipt or where it’s gone. It’s just gone. “You get what you pay for.” The only alternative to a service like the PO’s is a “messenger” service. Like the herds of delivery bikes that race around cities all over the world, said Marshall. And an interesting example of this, and one that is now threatening all other postal services as it has already done to the SA taxi industry, according to Marshall, is that of the ‘Uber’ taxi service. But Uber, with both passengers and parcels? “They began getting more and more requests for their drivers to carry parcels across the cities,” said Marshall. “That’s messengering and not courier. But it works.” And that was a question that your very own FTW had to answer during that PO strike. What alternative to the Post Office did we have for the delivery of printed copies of FTW? Not much really, according to Anton Marsh, MD of Now Media and publisher of FTW. Now Media is trying to deliver 4 000 copies a week of a relatively low-value postal item to addresses around the country – some of these are relatively out-of-the-way places. “At the time of the strike, it seemed that nobody but the PO and courier companies could carry this type of stuff,” Marsh said. “And, because we were suddenly faced with the need to deliver magazines urgently, we had to use courier companies – after we had changed all the addresses to street addresses. “But this was costing R30- R50 an item, and was just not sustainable. Also, even these guys only operate in high population density areas, so anything to a dorp in the bundu is not a cost-efficient exercise.” But then Marsh found a private company, Media Support Services, that is a delivery operation for magazines and newspapers. “This answered our need. So now, we move our 4 000 copies of FTW – 2 500 by hand delivery; 600 by the PO to regional areas and marginal city areas; 500 to OR Tambo International Airport (Ortia) and 250 to Lanseria; with 200-300 the few that fall under ‘other delivery types’.” So, in this case study, Marsh pointed to the SA Post Office having gone from 3 700 FTW deliveries a week a year ago to 600 now. “That’s an almost 84% loss of business to Sapo, and it still costs us the same,” he said. INSERT & CAPTION The Post Office has gone from 3 700 FTW deliveries a week a year ago to 600 now. – Anton Marsh