“Forward ever, backward never: onwards with Breaking Through”
No 79 -2019Click here to view
Formulated by UNI Apro Post and Logistics Sector

USPS increases security measures on packages to protect staff. October 3, 2019.

One strong nationwide postal network for the Netherlands. October 1, 2019.
Nottingham strike ballot after postman ‘fired for complaining’. October 1, 2019.

UPS completes expansion of Tennessee distribution facility. September 30, 2019.

NZ Post reports $35 million increase in revenue, write-down on mail assets. September 27, 2019.

USPS increases security measures on packages to protect staff

October 3, 2019
The United States Postal Service (USPS) is increasing the safety and security of its collection box procedures through a modification of the long-standing Aviation Mail Security Rule, which was established in August 1996 and called for all packages weighing 16 ounces to be presented in person to a postal clerk or a letter carrier.

The action was taken to enhance security measures and to protect the public, postal employees and postal contractors who transport the U.S. Mail.

In 2007, the weight allowance was decreased to 13-ounces or more for all anonymous mail. Since then, packages and other mail pieces weighing 13 ounces or more, bearing only stamps as postage must only be presented to a postal employee at a retail counter.

This month’s update to the rule will enhance the existing safety program by prohibiting packages with stamps as postage that are more than one-half inch thick and/or weigh more than 10 ounces from anonymously being entered into the mail stream through collection boxes or Post Office mail slots. Packages and all other mail pieces of this type will now need to be taken to a retail counter.  This change is effective Oct. 1, 2019.

 Consumers who opt to use postage stamps to mail packages, or other items, weighing more than 10 ounces and/or more than one-half inch thick must conduct their transactions at a Post Office retail counter. Consumers can also take advantage of Postal Service self-service kiosks to purchase postage labels and drop those packages into the package slots, not mail slots, at a Post Office. If a restricted package or mail piece is found in a collection box, mail chute or lobby mail slot after Oct. 1 it will be returned to the sender with a Customer Return Label attached explaining the restrictions and reason for return.

Source : https://postandparcel.info/115111/news

One strong nationwide postal network for the Netherlands
October 1, 2019
The Hague, the Netherlands, 1 October 2019 – PostNL and Sandd are combining their postal networks to create a reliable, accessible and affordable postal service, with greater job security for thousands of postal deliverers. With the Deputy Minister of Economic Affairs and Climate Policy having granted conditional approval and with all other conditions met, PostNL will now acquire all of Sandd’s shares and start the integration of the two networks.

Herna Verhagen, PostNL’s CEO, said: “This is a key strategic step towards a robust and stable mail business. We are very aware of the responsibility that comes with our leading position in the postal market, which means that we will continue to carefully weigh the interests of all stakeholders to help us create both financial and social value. The consolidation will bring greater quality and continuity to senders and consumers, and enhance job security for our postal deliverers. We’ll be continuing our existing price policies of the past few years.”

Ronald van de Laar, Managing Director of Sandd Holding, commented: “Looking back on two decades of Sandd, I can only say that I’m extremely proud of and grateful for what we’ve achieved together. That said, the time has now come for a single, robust Dutch postal network that offers consumers, businesses and our workforce the best long-term solution. We have agreed a solid way forward for the integration of our networks and for the future of our people.”

PostNL and Sandd announced they were looking to join forces on 25 February 2019. When the Authority for Consumers and Markets (ACM) ruled on 5 September that it would not grant a licence, PostNL and Sandd invoked Article 47 of Dutch competition law to urge the Deputy Minister of Economic Affairs and Climate Policy to decide otherwise. On 27 September she decided to grant permission on the basis of significant public interest, subject to a number of conditions.

With these two networks combined, both businesses and consumers will have the security of a postal service that meets high quality requirements and remains affordable and accessible across the Netherlands.

The consolidation also provides greater job security for thousands of postal deliverers and will help cushion the decline of the postal market in a socially responsible way. For one thing, Sandd’s postal deliverers will all be offered jobs with PostNL, while PostNL will find alternative positions within the company for other Sandd people, or look for alternative solutions.

PostNL will also continue collaboration with sheltered workplace companies. As a result, the consolidation will not affect employees who face challenges in the labour market. PostNL has drawn up a solid plan to help it complete the integration of both networks in the first six months of 2020. Over the next couple of months, it will consult with Sandd customers to gradually absorb their volumes into the PostNL network, with the bulk of the migration scheduled to take place at the beginning of 2020. Once the integration is completed, Sandd’s brand and stamps will be discontinued.

Sustainable value creation
On 25 February 2019, PostNL published the transaction’s outlines and expected financial consequences. Since this announcement, PostNL made the business case more robust and developed a solid integration plan. The 27 September decision has created clarity on the conditions – access, returns and workforce – set by the Deputy Minister of Economic Affairs and Climate Policyfor the consolidation to go ahead. The key elements of the transaction are:
Cash consideration of €105m at closing (including redemption of shareholder loans) and assumption of circa €25m in other liabilities by PostNL
Annual underlying cash operating income (UCOI) contribution* synergies of €50m - €60m, reaching full run-rate in 2022
Integration-related cash-out of approximately 1x run-rate synergies, equally split over 2019 and 2020; one-off costs (non-cash) related to accelerated depreciation in 2019 and 2020
Delay in implementation of current cost savings plans will impact result by €(30)m - €(50)m (cumulative) in period 2019 – 2022 (25 February 2019: €(50)m - €(70)m)
Expected negative UCOI impact in 2019 is expected to be between €(15) million and €(25) million
Positive contribution to UCOI in 2020

Funding and dividend
In financing the transaction and the ensuing integration costs, PostNL expects to temporarily exceed the leverage ratio target (adjusted net debts/EBITDA) of 2.0x max. In line with its dividend policy, PostNL will not pay dividend during the integration period as long as the leverage ratio exceeds the 2.0x figure. PostNL aims to reduce leverage below the 2.0x target in 12 to maximum 24 months and to resume paying dividends thereafter.

Source : https://www.postnl.nl/en/about-postnl/press-news/press-releases/2019

Nottingham strike ballot after postman ‘fired for complaining’

October 1, 2019
Angry postal workers met outside Glaisdale Delivery Office this morning and vowed to fight for justice in response to the “unfair dismissal” of one of their fellow workers.

No 80 -2019

Formulated by UNI Apro Post and Logistics Sector

Swiss WorldCargo signs up for seven more years with Cargologic. October 3, 2019.
Digitisation“The Biggest Lever” for  DPDHL.
October 2, 2019.

TForce Final Mile Bargaining – Red Deer Update.
October 1, 2019.

Swiss Post completes sale of CarPostal France to Keolis S.A. September 30, 2019.

Japan needs to rethink the last mile if capability is to be maintained. September 30, 2019.
Swiss WorldCargo signs up for seven more years with Cargologic

October 3, 2019

Swiss WorldCargo has extended its deal with cargo handler Cargologic at Zurich airport for another seven years.

The deal will see Swiss WorldCargo continue to use Cargologic’s airfreight handling competencies at its hub in Zurich, where Cargologic will maintain its position as dedicated ground handler.

According to Swiss WorldCargo’s head of quality and services Christian Wyss said: “We can depend on Cargologic as a professional partner delivering a premium service. Together, we offer our customers fast, efficient and reliable services. Needless to say, we jointly ensure that consignments arrive as per our promise to our customers.”

Marco Gredig, managing director of Cargologic, added: “The long-term continuation of this proven partnership is extremely important to us. It is a clear reaffirmation of the Zurich Airport location and makes a substantial contribution to its future growth.”
Source : https://www.aircargonews.net

Digitisation “The Biggest Lever” for DPDHL

October 2, 2019

Deutsche Post DHL Group has revealed its new corporate strategy and announced plans to invest around 2 billion euros in digitisation  by 2025. 

With the “Strategy 2025 – Delivering excellence in a digital world”, the company will focus even more consistently on tapping the continuing high potential for long-term profitable growth in its logistics core businesses.

The investment would  directed into “modernising IT systems, integrating new technologies and offering employees targeted advanced training to enable them to use these technologies”.

In addition, it will accelerate the already initiated digital transformation of the Group in all divisions.

Frank Appel, CEO of Deutsche Post DHL Group presenting the “Strategy 2025” in Frankfurt am Main said: “Deutsche Post DHL Group is stronger than ever before and we believe that future growth will result from a consistent focus on our profitable core logistics businesses – and digitisation will be the biggest lever,” said Frank Appel, CEO of Deutsche Post DHL Group presenting the “Strategy 2025” in Frankfurt am Main. “We do not have to reinvent ourselves, we will digitise ourselves.”

The Group has set itself the following concrete financial targets for the coming planning period until 2022:
EBIT should rise to at least 5.3 billion euros.
The Group plans to generate a cumulative free cash flow of 4.5 to 5.5 billion euros in the period from 2020 to 2022.
Capital expenditure (capex) is expected to amount to between 8.5 and 9.5 billion euros over the period from 2020 to 2022.

Source : https://postandparcel.info/115081/news

TForce Final Mile Bargaining – Red Deer Update

October 1, 2019
We represent TForce Final Mile couriers and other employees in Ottawa, Winnipeg, Saskatoon, Red Deer, Kelowna, Victoria, Prince George, Kamloops and Nanaimo. CUPW served notice to bargain for all these units in December 2017.

It’s been a rough round of bargaining at times. As you’ve seen in previous updates, we are now concluding successful negotiations in one unit after another.

The latest unit to achieve a collective agreement (CA) is Red Deer! The agreement was ratified by a 100% YES vote on Friday September 27th.

What did we gain?
Increase in hourly rate for attending all meetings (for owner operators) - from $15.00 to $20.00
Increase in uniform allowance
Reduction in communication device charges
Wage increases:
Warehouse Worker – from $13.91 to $15 at signing
Warehouse Lead Hand – from $15.19 to $16.18 at signing
2% July 1, 2020
2% July 1, 2021
2% July 1, 2022
4% increase to Benchmarks
Car/Mini Vans/1/2 ton $156.77 January 1, 2020
Cargo Van $164.25
Cartage $246.29
Labour Code increase to bereavement leave
Labour Code increase vacation entitlement
$750 signing bonus
Elimination of cargo bond insurance charged to drivers.
10.Expanded and comprehensive Rate Committee language

One More to Go
Winnipeg and Saskatoon ratified a new CA in February, and the units in B.C. ratified theirs in April. Talks are ongoing for the Ottawa unit, and we are confident we’ll make real gains there too.

Your sustained unity and determination are what brought TForce to the table. When you stand together, stay informed and stay involved, your collective power makes a real difference, and here we see more results.

Source : https://www.cupw.ca/en

Swiss Post completes sale of CarPostal France to Keolis S.A.

September 30, 2019
The French competition authorities have given the green light for the sale of CarPostal France. The SNCF subsidiary Keolis S.A. is to take over CarPostal France together with all its operating staff and vehicles. With the sale of CarPostal France, Swiss Post is bringing to an end the commitments of PostBus in France.

Swiss Post announced its decision to sell CarPostal France on 27 May 2019. On 26 September 2019, the French competition authorities in Paris approved the request for the sale of CarPostal France to Keolis S.A. With the sale, Swiss Post is delivering on the promise it made last year to examine an orderly exit from the French market as part of PostBus’s new strategic focus.

In the French company Keolis S.A., Swiss Post has found a buyer which enjoys a good reputation and foresees a socially acceptable integration of CarPostal France. As part of the acquisition, Keolis will take on all companies, including their operating staff and vehicles, meeting both requirements set out by Swiss Post for the sale of CarPostal France. The sale of CarPostal France will create long-term prospects for the company and its approximately 1,200 employees in France.

CarPostal France sold in a good, competitive condition.

After a difficult economic start, CarPostal France has been financially stabilized over the past few years. CarPostal France is now in a good, competitive condition. The value of CarPostal France at the time of the takeover by Keolis is around 62 million Swiss francs. The sale includes the shares of CarPostal France SAS, including its 18 subsidiaries.

The sales package comprises all the assets (vehicles, properties and moveable assets) and liabilities of the individual companies. Swiss Post will register an expected loss of around 19 million Swiss francs* from the sale in its carrying amounts, subject to actual figures as at 30 September 2019.  The negative effect from currency translation amounts to 14 million Swiss francs*. This is due to the development of the euro-Swiss franc exchange rate since the acquisition.

Source : https://www.post.ch/en/about-us/media/press-releases/2019

Japan needs to rethink the last mile if capability is to be maintained

September 30, 2019

A tight labor market and a booming e-commerce sector is putting pressure on last mile operators in Japan. Japan Post, Yamato and other carriers are undergoing change to cope with this pressure. Analysis from Ian Kerr (Postal Hub Podcast) and Marek Różycki (Last Mile Experts).

Japan’s delivery sector is caught in a bind. It’s suffering severe labor shortages while the number of parcel deliveries continues to rise thanks to e-commerce – 4.25 billion in FY 2017, up 5.8% from the previous year. Meanwhile the percentage of working-age people aged 15-64 fell 0.28% to 59.49% in 2018.

So how is the delivery sector responding? Let’s start with Japan Post.

Letters down, parcels up
Japan Post is facing a situation familiar to posts the world over. Letter volumes are falling, while e-commerce parcels are booming. In August it was announced that Saturday delivery for standard mail would cease due to a labor shortage and dwindling demand. Standard mail delivery requirements will also be relaxed.

While Saturday deliveries for letters could be terminated as early as next year, Saturday delivery for parcels is to remain, along with express and registered mail.

A government panel proposed an end to next-day delivery for standard mail, and that the standard delivery time limit of three days be extended to four days. The Japanese government holds a more than 50% stake in Japan Post Holdings.

Japan Post estimates the changes will lift its postal service profit by ¥62.5bn (US$578m) thanks to reduced labor costs.

Labor shortages
Japan Post isn’t alone in suffering labor shortages. National parcel carrier Yamato is also suffering capacity issues thanks to e-commerce growth and first-time delivery issues.

Home delivery still accounts for almost all online orders. Cultural norms have led to a situation where Japan Post, Yamato, Sagawa and other Japanese carriers will continue to attempt residential delivery until the consumer says otherwise. Market reports suggest that 15-20% of home deliveries fail first time. With more women and seniors working, and single-person households increasing, face-to-face deliveries to the home are proving more difficult.

Rakuten and One Delivery
Price rises have also been introduced as a means of dealing with the driver shortage. This has also opened the door for online retailer Rakuten to launch its One Delivery initiative.

Rakuten is Japan’s biggest e-commerce site. In reaction to continued capacity issues and increased delivery costs, it is taking a leaf out of Amazon’s book in launching One Delivery.

With One Delivery, Rakuten will manage merchant deliveries from end to end, working through both Rakuten’s own logistics network and external partners.

Merchants will be able to use Rakuten fulfillment centers and customers will be able to opt for faster deliveries. It also offers some interactive delivery management (IDM) features, such as checking delivery status and specifying the exact delivery time and method (such as pickup at a convenience store, delivery locker or residential delivery).

Rakuten is also collaborating with external partners to build a comprehensive logistics network.

Rakuten’s self-operated door-to-door delivery service, Rakuten Express, is also growing to cover all Japan’s major cities. Last year Rakuten launched ‘Oki-hai’ delivery, a variation on unattended home delivery, allowing customers to designate a location for couriers to drop off deliveries, for example ‘near the doorway’ or ‘near the gas meter’.

What about Amazon?
Amazon is active in Japan and is taking a different approach to the labor issues affecting the major carriers. Amazon’s Prime Now service in Japan increasingly depends on individual freelance drivers working via Amazon Flex.

Sagawa Express stopped delivering for Amazon in 2013 and, following price increases in 2017 and capacity issues, Yamato reduced its contract with Amazon and withdrew from delivering Prime Now purchases.

The labor shortage means Amazon Flex drivers approach delivery as a side job that they do in their spare time.

Amazon Japan has announced it will begin installing Amazon Locker pickup kiosks in Japanese retail outlets and train stations this year, starting with Tokyo. It is partnering with the FamilyMart convenience store chain, supermarket operator Fuji Citio and Odakyu Electric Railway.

Amazon Japan intends to expand the service to 500-1,000 locations nationwide over the next few years.

Parcel lockers
Packcity Japan is a joint venture (JV) formed in May 2016 between Yamato and Neopost Shipping, with Yamato owning 49%. The JV already has a network of around 5,000 locker installations, which are carrier agnostic.

Japan Post has set up a locker service called Hako Post. The service is carrier specific (Japan Post says it is considering opening up the network) and currently operates some 400 lockers in major cities. Earlier this year it was reported that Japan Post is considering joining the Packcity network.

In 2017 a government survey found that fewer than 1% of people had used parcel lockers for e-commerce deliveries.

PUDO points
While there are tens of thousands of PUDO points in Japan, particularly in the convenience store sector – Lawson, Family Mart, Circle K and 7/11 all have wide-scale tie-ups with the major carriers – the adoption of PUDOs in Japan still lags behind many other e-commerce markets. To date, PUDOs have been almost exclusively used for failed deliveries, rather than a customer delivery preference.

Rakuten is encouraging its shoppers to nominate Japan Post post offices or parcel lockers as their delivery preference. Japan Post has a network of about 20,000 post offices.

Traffic congestion is a problem in many markets, but in Tokyo local authorities are encouraging measures to reduce congestion in the lead-up to the 2020 Tokyo Olympic and Paralympic Games.

In an attempt to reduce parcel redeliveries, Yamato will promote its advance parcel delivery notification service, which allows customers to change the location for receiving parcels. It will also continue to grow its parcel locker network.

Rakuten is partnering with China’s JD.com on drone delivery, with the aim of accelerating the development and commercialization of Rakuten’s unmanned delivery solutions in Japan.

Drones were used to make deliveries from a convenience store to a recently de-quarantined area near the Fukushima nuclear disaster, where residents were returning to a town devoid of shops or services.

More recently Rakuten partnered with Bell Helicopter to jointly develop a drone capable of traveling at 160kph (100 mph) and carrying up to 32kg (70 lb). The drone itself is 2.7m (8.8ft) wide, 1.8m (5.9ft) tall and weighs about 160kg (350 lb).

But drones aren’t just in the air – ground-based delivery robots are also being developed. Rakuten will be using JD’s delivery robots, while other robots have been trialled at university campuses.

Delivery robots can’t be deployed on public roads for now, but the Japanese government plans to open up public roads for trials of unmanned delivery robots in the next six months or so.

Japan is a stark example of what happens in developed economies with an aging population and shrinking labor pool when there is an explosion in e-commerce parcel volumes.

The Japanese are right to explore IDM but will need to pair this with out-of-home delivery capability (offering higher first-time delivery success rate and greater operational efficiency with more parcels per stop) to manage growing volumes.

Source : https://www.parcelandpostaltechnologyinternational.com/analysis