Austrian Post Repositions Parcel & Logistics Division in Austria
In a Supervisory Board meeting held on December 12, 2007, the Management Board and Supervisory Board of Austrian Post approved a comprehensive plan to reposition the Parcel & Logistics Division in Austria.
Essentially, the concept encompasses three core measures which will be implemented during the year 2008 to enable an improved market position of the Parcel & Logistics Division.
– Redimensioning (downsizing) of parcel logistics operations, and its partial integration in the letter mail logistics operations, in order to create an even more efficient nationwide delivery network
– New premium product: the 24 hour business parcel (B2B and B2C)
– Growth in the B2B business customer parcels segment – market share of 20pct in 2011
The restructuring measures will lead to the closing of 7 parcel delivery bases, and the transfer of the Parcel Sorting Centre Graz to the existing location in Kalsdorf. The planned reduction in the parcel logistics work force by about 360 employees resulting from lower parcel volumes will be cushioned as much as possible by shifting employees to the Mail Division or by means of a social (redundancy) plan.
“In recent years, we have transformed Austrian Post into a successful and profitable company. The EBIT has risen continually from EUR 4m in 2002 to a planned level of EUR 160m in 2007. The current package of measures will enable us to continue our path to success. The restructuring measures will ensure that the Group profit for the period in 2008 will only be slightly under the 2007 level, and then rise continually. We are well on track to achieve an expected mid-term EBIT margin of between 7pct and 8pct”, says Anton Wais, Chairman of the Management Board of Austrian Post.
The restructuring plan encompasses the following measures:
1. Redimensioning of parcel logistics operations: quicker and more efficient service in conjunction with letter mail logistics
This new approach will enable standard package logistics to be carried out in a more efficient manner, and exploit synergies with letter mail delivery processes. A total of 7 parcel delivery bases (Wörgl, Vitis, Steyr-Dietach, Großwilfersdorf, Fohnsdorf, Liezen and St. Georgen locations), will be closed. A large proportion of the parcels volume will be handled by Austrian Post’s nationwide network of 11,000 delivery staff. Parcel delivery in urban areas will continue to be carried out with a separate parcel delivery service.
Accordingly, Austrian Post will require about 360 fewer employees for parcel logistics. All related measures will be cushioned by an existing employee severance scheme. In addition, some employees from the Parcel & Logistics Division will be integrated into the letter mail logistics segment. Transport logistics will be further optimised, and the areas covered by existing freight carriers partnering with Austrian Post will be expanded.
2. Improved and value added services: launch of new premium product, the “24 hour business parcel service“ to complement the 48 hour parcel
The Parcel & Logistics Division will offer improved services in the course of the year 2008. A new premium product, the “24 hour business parcel service” will provide considerable competitive advantages to B2B and B2C customers. The final deadline for accepting parcels for next day delivery will be extended from 7:00 p.m. at present until 1:00 a.m. This represents an extremely significant improvement, taking into account the parcels arriving from international central storage facilities, which are increasingly located outside of Austria.
Moreover, multiple delivery attempts and Saturday delivery are among the changes which will primarily benefit private customers. In the case of multiple delivery attempts, a time will be scheduled with the recipient via a call centre and electronic notification of the parcel delivery staff.
3. Sales drive in the B2B segment – market share of 20pct targeted for 2011
Austrian Post
