Mexico's postal services: On Mexican time
An improvement from appalling to bad
WANT to pay a bill in Mexico? Go to the bank, and pay it straight into your creditor’s bank account. Wish to send a letter across town? Call a messenger. Something for abroad? Use an international courier. As for the state-owned postal service, Sepomex, it evokes a laugh from most Mexicans.
Mexico’s dysfunctional postal system
Gonzalo Alarcón, Sepomex’s head, says that “delivery times are acceptable”. He seems to be among the few who thinks so. “If you are trying to send a piece of mail from a small city to another small city, may God help you,” says Carlos Casasús, a former official at the transport ministry.
Sepomex is less inefficient than it was. Its annual losses were equal to half its total revenues, but have fallen to 10% even though wages for postmen have doubled in the past five years. But Sepomex has only one automated mail sorting-machine, at Mexico City’s airport. Many of the 2m letters and parcels it delivers each day are conveyed by bicycle. It does not help that Sepomex has just 20,000 employees serving 103m people. The United States Postal Service has over 700,000 workers in a country of 300m.
Remarkably, Sepomex retains 60% of Mexico’s postal market, with the rest shared by private companies. Constitutionally, Sepomex has a monopoly for letters and small packages, but this is not enforced. Mr Alarcón complains that his private competitors evade paying taxes and workers’ benefits. Since the private firms do not have to provide a universal service, they concentrate on business customers and can afford to invest in automation and training.
The government says that 95% of the mail is now delivered within target times–which range from one to ten days. Anecdotal evidence belies this. Marc Chassinat, whose company delivers newspapers and magazines to subscribers, concedes that Sepomex is better than it was. But, he adds, “the chances that [it] will improve enough in 20 years to force me out of business are nil.” Though that provides an opportunity for nimble entrepreneurs, it imposes an uncounted cost on the economy.
SOURCE: The Economist
