Tailor-made solutions at a competitive price is what the Post Office’s logistics business unit is all about. Comprising Speed Services, PX and XPS, it is matching service offerings to its capabilities, and getting its prices right, according to unit MD Molefe Mathibe. It has also been cutting costs and reducing its operating losses in the past three years, he told FTW. There’s also a concerted focus on the turnaround strategy, backed by a strategy of pricing for profit together with other pricing and cost-reduction initiatives. This was initiated by investigations and detailed planning that included splitting the courier and freight services offerings – and involving clearly differentiated minimum weight and pricing considerations. From February 2005 the group has consistently recorded some large gains in sales that are now correctly priced, according to Mathibe. “We re-looked at our accounts, we re-looked at the prices we were charging, and we looked more closely at the relationship with our customers,” he said An example of its costcutting initiatives was in the line haul business, where its initial goods sorting and classification procedures were adjusted to ensure that it was transporting items by the most appropriate and cost-effective means. “Internal staff took a critical view of the product sets, and eliminated some of them from the product mix,” said Mathibe. “Sales, in the meantime, have focused on the performance of major accounts – and this has been linked to the staff’s commission earnings and performance assessments.” To help ensure that the group delivers on its plans and budget, Mathibe pointed to the use of advanced technology wherever possible. “This is in such areas as electronic proof-of-delivery systems via palmtops,” he said. “The group intends to expand on this trend as much as possible in every aspect of its operations.”
