Latvian Post planning reforms to cope with competition
Latvian Post’s new management board has launched a review of the business ahead of the liberalisation of the country’s postal market next year. Ministers appointed a new three-person board last month, chaired by former head of delivery Māris Kleinbergs, with a view to the arrival of competition in the postal market from January 2013 in compliance with European Union postal laws.
Yesterday the Post said its new leadership is now planning a reform process for existing operations and developments that will also involve introduction of new services.
The biggest changes will involve a restructuring of the company to avoid duplication of operations and cut out unnecessary costs. Currently, Latvian Post has around 600 sites and 4,600 staff.
Latvian Post said changes are particularly needed in the delivery of basic mail services, including improvements to postal delivery services and also for customer service at post offices.
The review is looking at all aspects of the postal business, from mail carriers to retail operations and transport costs.
Latvian Post said in a statement: “Latvian Post expresses its commitment to making reforms in 2012 to reach the goals of postal service quality improvement, cost management and stable operation under the conditions of a liberalised postal market in 2013.”
Reforms
Describing some of the aims of the reforms being considered, The Post said it wanted to avoid “excessive centralisation” in its network and the associated delays to mail delivery that such a situation can cause.
Unprofitable real estate looks likely to be sold off to cut costs, with the Post also aiming to “radically” change its human resources strategy to “significantly” reduce its administrative department.
“The Latvian Post board believes on current estimates that a separate administrative structure can be reduced by up to 50%, and that total annual savings from the planned changes could reach up to LVL 700,000 ($1.3m USD),” said the company.
In terms of introducing new services, Latvian Post said its management board is devoting its attention towards the maximum possible diversification of the company, for example looking at how partnerships with other businesses might help to expand the services on offer in post offices.
The Post said: “Latvian Post has already been encouraged, and will soon begin, cooperation with local authorities to provide their services, such as financial services. This has already been tried successfully in Carnikavā. There is also interest in similar types of cooperation with Latvian Post.”
Latvian Post is also aiming to continue expanding its new freight services, launched last year to make use of its “unique” transport network coverage in offering “regular and cost effective” delivery of goods anywhere in Latvia.
