Formulated by UNI AproPost and Logistics Sector
1. Ofcom calls on royal mail to modernise its network and become more efficient.
DHL deploys electric truck on streets of London.
4. Australia Post in full flight to deliver in Queensland.November 21, 2020.
5. Canada Post segment reports $265-million loss before tax in third quarter. November 20, 2020.
1. Ofcom calls on royal mail to modernise its network and become more efficient
Ofcom’s sets out data and trends within the postal sector, and examines Royal Mail’s performance. In 2019/20, 2.8 billion parcels were sent and received in the UK – one billion more than in 2013 – in a market now worth over £10bn in revenues.
The organistion said: “Our analysis of Royal Mail’s efficiency shows that costs in the part of the business responsible for the universal service increased last year. The company failed to make efficiency gains or meet the targets it set itself for improving productivity.
Unless Royal Mail can modernise its network to adapt to parcel customers’ changing needs, and operate more efficiently, the sustainability of the universal service could be at risk in the longer term.”
Lindsey Fussell, Ofcom’s Networks and Communications Group Director, said: “Our research suggests that people’s needs would still be met if letter deliveries were reduced from six days a week to five.
“It would ultimately be for Parliament to decide whether this change is needed. However, Royal Mail must still modernise and become more efficient, to keep pace with customers’ changing needs.”
Keith Williams, interim Executive Chair, Royal Mail Group, commented on Ofcom’s recommendations: “Royal Mail is proud to deliver the ‘one price goes anywhere’ Universal Service which is so valued by customers across the UK. Our unique responsibility began in 1840 when the world’s first adhesive postage stamp, the Penny Black, was used as payment to create a uniform postage service. Times may have changed a lot, but the Universal Service remains vitally important. With changing user needs, which have been accelerated as a result of the pandemic, there is a clear need to move with the times.
“To stay relevant and sustainable, the Universal Service must adapt to life in the 21st Century. Ofcom’s User Needs Review has shown that reducing letter deliveries to five days a week would still meet the needs of nearly all people and businesses. In the last six months alone, letter volumes have fallen by around a third. The reduction in letter volumes has had a significant impact on the finances of the Universal Service which lost £180 million in the first half of the year. This, along with our own comprehensive customer research, demonstrates the need to rebalance the Universal Service in line with growing consumer demand for parcels, and lower usage of letters.
“We are working hard to improve efficiency and transform our parcels operation. We have increased the automation of parcel sorting and are investing in two new parcel hubs. But at the same time we recognise that the business has failed to make the progress it would have liked on operational productivity and agree that this must change. Too many parcels are still sorted by hand, and we have not adapted quickly enough to the decline in letters. We’ve taken immediate steps to stabilise business performance and set Royal Mail back on a path towards profitability. But as we have said previously, these measures and the delivery of our transformation plan will not be enough, in themselves, to ensure the USO is financially sustainable in the long term.”
“We will consider Ofcom’s findings very carefully. We look forward to engaging further with Government, Ofcom, our unions and other stakeholders to ensure the Universal Service continues to meet the changing needs of consumers, and ensure it remains financially sustainable.
The organisation said: “We have researched whether the minimum requirements of the universal service reflect the reasonable needs of postal users. It would be for the UK Government to determine whether any changes are needed to these minimum requirements and to bring any proposals before Parliament.
Separately, we are reviewing the future regulatory framework for post. This will consider issues affecting the broader postal sector, as people’s reliance on parcels continues to grow. For example, we will look at continuing the requirements for Royal Mail to provide wholesale access to its network, and whether extra consumer protections are required in the parcels market. We will consult on these issues next year and conclude this review in 2022.”
3. DHL deploys electric truck on streets of London
DHL has begun operating its first purpose-built fully electric 16-ton vehicle in the UK. The Volvo FL Electric 4×2 rigid is now part of DHL Supply Chain’s fleet in London, making last-mile deliveries into the West End shopping district.
The vehicle is powered by four 200kWh batteries, giving a range of 193km, and can carry a maximum of 12 pallets weighing up to 6 tons. The company notes that the truck will recharge overnight at its base in Purfleet for daily operations into the city center.
Ian Clough, managing director, network logistics and transport, UK & Ireland, DHL Supply Chain commented on the trial: “As the market leader in contract logistics, and part of the world’s largest logistics group, we have a responsibility to reach for ambitious sustainability targets as we deliver best-in-class solutions for our customers.
We are very proud and excited that our investment in the UK’s first operational fully electric large commercial vehicle is just another example of how we are doing that.
The Volvo FL Electric is the perfect solution to the challenges of urban logistics, allowing us to make deliveries in densely populated inner-city locations where air quality and noise pollution challenges are highest.”
According to research conducted among transport decision makers on behalf of DHL, ground transportation is moving away from its traditional role as a commodity toward becoming a business differentiator; 71% believe it is a strategic component of their business, and 75% agree that investment in this area will directly support growth.
4. Australia Post in full flight to deliver in Queensland
November 21, 2020
A new dedicated Australia Post freighter has taken to the skies transporting up to 60 tonnes of mail each week to and from the Gold Coast, improving parcel delivery times for local online shoppers ahead of Christmas.
The new freighter service comes as local demand for parcels booms, with online shopping growth for the first eight months of the pandemic up 64 per cent year-on-year.
Popular purchases on the Gold Coast include food and liquor, and home and garden products, with both categories up 90 and 78 per cent respectively, when compared to the same time last year.
Essential medical supplies and various other items are also transported via the service.
Australia Post General Manager Deliveries North, Christian Jackson said the new service is one of many recent investments the organisation has made it its air network during the pandemic.
“We’ve invested heavily in our air network this year and looked closely at where we were seeing big growth so we can better service the Australian community,” said Mr Jackson.
“The dedicated Gold Coast freighter is an important addition to our network as it removes the need for parcels to transit via Brisbane, allowing us to get parcels to customers faster than ever before.
“With this new plane we have more than 70 flights to and from Queensland each week - an increase of 40 per cent since February - so we’re well placed to deliver for Queenslanders ahead of the upcoming Cyber sales and the Christmas rush,” Mr Jackson continued.
Australia Post has also boosted capacity on the ground welcoming 1000 new recruits to its Queensland operations. This includes more than 350 Christmas casuals who will be working at Australia Post’s Brisbane Parcel Facility helping to process up to 700,000 parcels per day.
Brisbane facility – the largest of its kind in the southern hemisphere – celebrated its first birthday in October and has processed more than 85 million parcels in its first year of operation.
Earlier this year, Australia Post also installed two new, automated parcel conveyors at its Pinkenba and Molendinar delivery facilities which have a combined processing capacity of 45,000 parcels per day; improving safety for staff and efficiency for customers.
“We’ve been delivering like it is Christmas for months now, and we’ve been planning meticulously for this upcoming peak. Our Queensland network is primed and ready to deliver what we know will be a Christmas like no other,” said Mr Jackson concluded.
Customers are reminded to post early this year to guarantee delivery prior to Christmas. Final posting dates are 19 December for Express post and 12 December for Parcel Post.
5. Canada Post segment reports $265-million loss before tax in third quarter
November 20, 2020
OTTAWA – Canada Post recorded a loss before tax of $265 million in the third quarter of 2020, as declines in Transaction Mail and Direct Marketing revenue and higher costs had a significant impact on earnings. Parcels revenue continued to grow in the quarter, but it was not enough to offset these contributing factors.
With Canadians shopping online more during COVID-19, the Parcels business continued to grow strongly in the third quarter. However, the postal service incurred significantly higher costs related to providing an essential service during COVID-19, including special leaves and additional collection, processing and delivery costs.
Canada Post also continues to incur added costs stemming from the June 2020 arbitrator’s ruling that resulted in new collective agreements with the Canadian Union of Postal Workers (CUPW).
For the first three quarters, which ended September 26, 2020, the Canada Post segment recorded a loss before tax of $709 million on revenue of $4.9 billion. That compares to a loss before tax of $162 million, on revenue of $4.8 billion, for the first three quarters of 2019. Canada Post estimates that COVID-19 had a net negative impact of $188 million on its before-tax results for the first three quarters of 2020. The segment would have still incurred a loss without the impact of COVID-19 and the new collective agreements with CUPW.
Canada Post’s Parcels business continued to be strong as Canadians shopped online more often during COVID-19, even as physical stores reopened in the third quarter.
Parcels revenue grew by $186 million, or 30 per cent1, in the third quarter and by $465 million, or 25.5 per cent, for the first three quarters of 2020, compared to the same periods in 2019. Volumes grew by 22 million pieces or 31.1 per cent in the third quarter, and by 52 million pieces or 24.5 per cent in the first three quarters, compared to the same periods in 2019.
Transaction Mail results
Transaction Mail is mostly letters, bills and statements. Ongoing revenue and volume declines accelerated as businesses and Canadians used digital alternatives even more during COVID-19. In the third quarter, Transaction Mail volumes fell by 72 million pieces or 11.5 per cent and revenue decreased by $52 million or 8.8 per cent, compared to the same period in 2019. Over the first three quarters of 2020, Transaction Mail volumes fell by 204 million pieces or 9.2 per cent, and revenue fell by $172 million or 8.1 per cent, compared to the first three quarters of 2019.
Direct Marketing results
Customers continued to delay or cancel marketing campaigns due to COVID-19 during the quarter, adding to the impact of ongoing digital substitution. Direct Marketing revenue declined by $60 million or 24.1 per cent in the third quarter and by $212 million or 26.9 per cent for the first three quarters of 2020, compared to the prior year. Volumes fell by 269 million pieces or 25.3 per cent in the third quarter and by 1 billion pieces or 31.0 per cent in the first three quarters, compared to the same period last year.
Group of Companies results
The Canada Post Group of Companies2 reported a loss before tax of $216 million in the third quarter of 2020, which was a $129 million change from a loss before tax of $87 million for the same quarter in 2019.
For the first three quarters of 2020, the Group of Companies recorded a loss before tax of $602 million, or $565 million worse than the same period in 2019. These results are due to losses in the Canada Post segment.
The Purolator segment recorded a profit before tax of $42 million in the third quarter of 2020, an increase of $1 million compared to the same period last year. For the first three quarters of 2020, Purolator recorded a profit before tax of $91 million, a decrease of $14 million compared to the same period last year.
The operations of the Canada Post Group of Companies are funded by the revenue generated by the sale of its products and services, not taxpayer dollars.
Formulated by UNI AproPost and Logistics Sector
1. Coronavirus pandemic also weighs on Swiss Post’s result.
November 26, 2020.
2. An Post: parcel volumes have reached spectacular levels.
3. MVS Division resolves national dispute on article 32.2 Vehicle Costs. November 25, 2020.
4. Aramex wants more of market.November 25, 2020.
5. It is no longer necessary to be at home to receive courier parcels. November 20, 2020.
1. Coronavirus pandemic also weighs on Swiss Post’s result
Swiss Post’s result for the first three quarters of 2020 is down year-on-year. At the same time, however, it appears to be stabilizing somewhat, which means that the impact of the coronavirus pandemic on Swiss Post’s finances at the end of the year may be less severe than expected after the second quarter. The annual result is now largely dependent on how the pandemic continues to develop and on business over the festive season.
In the period to the end of September 2020, Swiss Post generated Group profit of 136 million francs. That is 127 million francs less than the prior-year period. Operating profit (EBIT) in the first three quarters was 176 million francs, 195 million less than the same period in 2019. Operating income is also down. At 5’113 million francs, it is 187 million francs lower than in the previous year.
The consequences of the coronavirus pandemic are also weighing on Swiss Post’s result. The significantly lower third-quarter result reflects the ongoing pressure on relevant value drivers at Swiss Post – letter volumes, over-the-counter transactions and interest rates. In the letter business, the volume of addressed letters fell by 6.8 percent compared to 2019, in payment transactions, there were 14.9 percent fewer over-the-counter payments, and PostFinance’s interest income was down 25 million francs year-on-year. While these three key figures have been declining for some time now, the negative trend was to some extent further exacerbated by the coronavirus crisis. At the same time, growing parcel volumes cannot offset the negative effects in the other business units (see box).
Some recovery beginning to show
“The final annual result depends on how the pandemic continues to develop and on the festive season, which is very important for our business,” says Alex Glanzmann, Head of Finance at Swiss Post. The forecasts are reviewed on a monthly basis and could change quickly, depending on the evolution of the Covid-19 situation, adds Swiss Post’s CFO, stressing that: “Thanks to the good basis that Swiss Post has established in recent years, we can cope with the current financial challenges from our own efforts.” Since August, there have also been signs of some stabilization. A certain recovery and a catch-up effect are beginning to show, particularly in letter volumes. For example, the volume of promotional mailings or of priority letters has increased again in individual months in the past quarter.
At the moment, Swiss Post assumes that the impact on Swiss Post’s finances by the end of the year will be less severe than was feared at the end of the second quarter. Overall however, Swiss Post expects a negative impact on its result amounting to a figure in the triple-digit millions, with the biggest part played by market effects resulting from the coronavirus pandemic. Examples of this include the accelerated decline in letter volumes at PostMail, as noted above, and the deficit in income from transport services at PostBus. The smaller part of the negative impact on EBIT is due to one-off effects of the coronavirus. These include the thank-you bonus for employees in business operations (10.5 million francs), the procurement of protective equipment such as disinfectant, Plexiglas screens and face masks, and the employment of temporary staff (21 million francs).
Solidarity shown and the economy supported
But it is not only Swiss Post that is suffering the effects of the coronavirus, it is the Swiss economy as a whole. Swiss Post has therefore taken action in solidarity, to provide additional support for or to relieve the pressure on the economy. For example, Swiss Post has paid its pending invoices earlier than the required payment deadlines. This means that suppliers have received urgently needed money as quickly as possible, enabling them to invest and use it for their financial obligations. Swiss Post has also reduced rents for tenants severely affected by lockdown, or refrained from collecting it entirely.
PostFinance for its part participated in the Federal Council’s assistance programme and granted its SME customers bridging loans. A total of 17’350 credit limits with a volume of more than 850 million francs were granted. And last but not least, Swiss Post will not make any general price adjustments to the mass parcel and letter business next year. Any changes will be delayed until the following years.
As Swiss Post’s Head of Finance Alex Glanzmann emphasizes: “With all of the measures adopted, Swiss Post has fulfilled its responsibility as a reliable partner of the Swiss economy.” The “COVID-19 Solidarity” stamp also reflects Swiss Post’s commitment to social cohesion. The proceeds, around 2.7 million francs to date, will go to Swiss Solidarity and the Swiss Red Cross.
2. An Post: parcel volumes have reached spectacular levels
An Post’s e-Commerce backbone has the capacity with the opening in October, just-in-time, of the second automated parcel hub in CityWest, Dublin; the arrival of 600 additional electric vehicles; and the deployment of the latest handheld scanners for track and trace.
In recent weeks An Post has delivered 2.5 million parcels per week and this is set to hit 3.3 million per week between now and mid-December. The mix of high street store closures during Level 5 Covid restrictions, online retail offers and early Christmas shopping is driving a 230% increase in parcels, from 1 million to 3.3 million items compared to the same period last year. Letter volumes are also rising steadily in response to An Post’s “Send Love and Memories” campaign. The Post Office network is also handling record numbers of parcels over the counter with customers availing of An Post’s packaging options.
Globally and nationally supply chains are under strain, working at record demand. E-tailers, postal and logistics organisations, and retailers’ Online services all carry the same message: Order as early as possible as delivery times globally are longer.
David McRedmond, CEO of An Post said “Parcel volumes have reached spectacular levels as the lockdown has driven all early-Christmas purchasing Online. Our €30 million investment in parcels automation ensures we have the capacity to deal with this surge. Processing and delivery are taking longer than normal and we are delivering record volumes of parcels seven days a week. It’s great to see such huge support for Irish goods and that customers are acting on our advice to post early to overseas destinations.
“We have 1,000 extra staff helping us this Christmas and our delivery staff have new scanning technology and electric vehicles to help them get parcels and letters to customers as quickly as possible. We’re working around the clock to deliver parcels and cards to customers speedily and safely. I cannot thank our staff enough for working tirelessly and efficiently despite all the necessary Covid restrictions, whether on the frontline, or in customer support, to make this as good a Christmas as possible for everyone”.
3. MVS Division resolves national dispute on article 32.2 Vehicle Costs
November 25, 2020
On November 23, the National MVS(Motor Vehicle Service) Craft Division came to agreement with the USPS on a class action Step-4 dispute regarding PVS (Postal Vehicle Service) Costs, case no. Q10V-4Q-C 16534585/HQTV20160326.
The issue presented was whether or not the USPS violated Article 32.2 of the National Highway Contract Route Agreement when they assigned the full cost of a vehicle as a line item in their cost comparison. The MVS Craft officers complained that these were unreasonable costs added to PVS making it harder to compete with HCR (Highway Contract Route) costs in the comparisons. This issue had been occurring for several years and was first challenged by former MVS Director Bob Pritchard. The MVS Craft always felt that this was a violation of several provisions of the Collective Bargaining Agreement including the Contracting or Insourcing of Contracted Services MOU.
The parties have agreed to the following:
"The purchase price of a vehicle is a line item on a cost comparison. The cost of the vehicle should depreciate over the anticipated service life of the vehicle, which is listed in Exhibit 221.211 of Handbook PO-701.
Exhibit 221.211 of Handbook PO-701 lists the service life of Tractors, Spotters, 5-ton, 7-ton, 9-ton and 11- ton as eight (8) years, and trailers as twelve (12) years.
The vehicle costs should be spread over the service life in the Article 32.2 cost comparisons as 1/8th the cost of the trucks and 1/12th the costs of the trailers until the vehicle has been depreciated. If the vehicles are still in service at the end of the service life, these costs will no longer be included in the Article 32.2 cost comparisons."
MVS Director Michael O. Foster stated, “this is a step forward in our journey towards a fair cost comparison in the Article 32.2 process. We will continue to seek transparency in our fight against subcontracting. I want to thank Assistant Director Ken Prinz and former Assistant Director Javier Pineres for their contributions in these efforts."
Source : https://www.apwu.org/news
4. Aramex wants more of market
November 25, 2020
The Dubai-based international logistics and courier giant Aramex wants to double its market share in Australia in the next two years as it expands the nation’s largest crowd sourcing operation in logistics known as Blu Couriers.
Aramex, which acquired Fastway Couriers four years ago, currently handles three million parcels per month through its network of almost 900 couriers and is gearing up for a 40 per cent increase in delivery volumes following the Black Friday and Cyber Monday sales.
Aramex Australia chief executive Peter Lipinski said the Aramex warehouse at Chullora in Western Sydney normally handled close to 1.5 million parcels per month, but in December that will increase to well over 2 million.
He said Aramex estimated that it had about 5 per cent of the local e-commerce market versus the more than 75 per cent share enjoyed by Australia Post.
Japan Post recently put its Toll Global Express assets on the market but plans to retain ownership of Toll‘s logistics and forwarding businesses.
“My target is that we double our market share in two years. The market is expanding as well. Provided you look after the receivers’ needs and be nimble and listen to your customer and try to be creative, you will grow share,’’ Mr Lipinski said.
“COVID has been very bad the for the economy overall, but from the logistics sector it has been very positive. We have seen massive increases in volumes of freight. When Melbourne went into its most recent lockdown, volumes doubled.”
In the wake of the pandemic wine deliveries in general are 60 to 90 per cent up on their average volumes of last year and doubled in most places.
“We have seen a massive uptake too on flatpack furniture. It is not the favourite one with courier franchisees but we have seen that almost double. Especially when people were setting up home offices. It has been the same with workout equipment,’’ he said.
Aramex, which is listed on the Dubai Stock Exchange, is now in detailed discussions with a range of retailers to assist their e-commerce offerings in the post-COVID world.
The firm’s Blu Couriers business, based on the Uber transport model where courier drivers can use their own vehicles and follow route-directing systems to plot the deliveries on a map, has been performing strongly.
Last month Blu Couriers was named as the Winner for Service Innovation at the Australian Business Awards 2020.
“We have always focused on e-commerce. We started looking at what we needed to do to cope with different scenarios. Courier Franchisees are good for stable growth. When growth is rapid, you need to scale up very quick. We started testing the Blu Courier idea four years ago. It has been really successful,” Mr Lipinski said. “The growth has been staggering, we have doubled, if not tripled the number of Blue Couriers. It was first the capital cities, it is now migrating into regional areas immediately outside the capital cities. We have 28 locations around Australia so it is available to all of them.”
The service saw a significant increase in inquiries from people looking to become couriers during the lockdown and Mr Lipinski said he now wanted to expand the model to evening and weekend deliveries.
“We are looking at developing it further into different services. For example we aren’t doing evening and weekend shifts. We want to look at that going forward,’’ Mr Lipinski said.
5. It is no longer necessary to be at home to receive courier parcels
November 20, 2020
From 30 November, couriers will start handing over parcels using a simplified procedure upon agreement with the client. This service change means that if the addressee is not home, they can agree for the courier to leave the parcel in a safe location protected from the elements, e.g. on the terrace, or hand it over to a neighbour. To confirm delivery, the courier takes a photograph of the parcel at the delivery site.
As an additional safety measure, this simplified procedure is also used even when the addressee is present to receive the parcel. In such a case, the client will receive the parcel from the courier, but there is no need for a signature and so physical contact is avoided. The signature is replaced by the courier's photograph of the parcel at its delivery site.
"We are listening to our clients' requests and will start issuing parcels using a simplified procedure – this way, the parcels will arrive faster and also with as little physical contact as possible," said Omniva (Estonian Post) Tallinn Terminal Manager Anneli Undrest. "We tested the simplified parcel issuing procedure as a pilot project in six cities and client feedback was positive everywhere."
Parcels are issued with the simplified procedure to both business and private clients. The new solution is used only in the case of national deliveries in Estonia and courier deliveries arriving to Estonia from Latvia and Lithuania. As an exception, a signature is still required in the case of additional services, such as identification, or if the parcel has a payment requirement.
Source : https://www.omniva.ee/