Dutch postal reforms to eliminate Monday deliveries

The Dutch government wants to allow the country’s universal postal service provider to cut back to five days’ delivery per week to avoid “significant” rate rises. Henk Bleacher, the secretary for economic affairs, agriculture and innovation told lawmakers last week that PostNL would be allowed to eliminate deliveries on Monday, the quietest day of the week for its service.

But, as ministers are set to introduce postal reform legislation in the first half of 2012, changes to the postal retail network and mailbox coverage will not be made.

The move from six- to five-day weeks would mean avoiding other cutbacks to services, the minister said, in order to cut costs to respond to declines in mail volumes.

The overall number of letters sent in the Netherlands dropped 14% in the five years up to 2010, from 5.6bn in 2005 to 4.8bn in 2010.

Predictions are for the decline to continue as more people use the internet for paying bills, accessing statements and even sending birthday cards.

Review

The Dutch government, which has been carrying out a promised review of the universal service obligation two years after the Postal Act was laid, said 85% of the Dutch population did not mind if there was one day less of mail delivery each week.

Research from Ecorys suggested shifting from six to five days of delivery would bring the biggest savings for PostNL.

Although SMEs had expressed a preference for eliminating Saturday deliveries, Bleacher said that only 2% of the total weekly mail was currently being delivered on a Monday, and it was therefore “obvious” to look at dropping Monday deliveries.

The plan to drop Monday deliveries would not affect urgent deliveries, Bleacher said. The minister also said that he will not for the moment consider amending the universal service requirements for PostNL’s network coverage.

“By dropping Monday delivery, the Postal Service can be affordable to all,” Bleacher said. “Reducing the number of mailboxes and post offices, as suggested in several studies, I think now is one step too far.”

Market

Running the country’s universal postal service in a liberalised Dutch postal market, PostNL is currently required to provide at least 2,000 postal outlets and 902 full-service postal outlets, most of which are now co-located in retail stores.

The Dutch postal market is currently almost 60% letters and more than 40% direct mail and periodicals.

PostNL, which has an 80-90% share of the overall postal market, faces virtually no competition for the sending of correspondence, but direct mail and periodical volumes are split between PostNL and rival Sandd, since Sandd acquired Selektmail in April.

In the growth area of parcels, however, the market in the Netherlands is much more competitive, with TNT holding around a half share of the billion-euro market, with Selektvract and GLS the other major players, and smaller players including DPD, UPS, Trans-o-flex, Skynet and Kiala.

PostNL recorded a EUR 313 loss in its third quarter results last month, and is currently in the process of restructuring to save on costs, with plans to centralise its operations and close hundreds of delivery offices from next year.