Non-traditional services filling in for letters in postal revenues

The Universal Postal Service has said its latest research shows that for the world’s postal operators, non-traditional services are “quickly filling the gap” in revenues as letter volumes slide. The UN-affiliated global postal agency said its latest statistics, for 2010, show that around the world letter post now accounts for 46% of the total $331bn postal revenues, down from 54% in 2001.

Filling the gap, parcel and logistics services have seen a 7.7% increase in global revenues for Posts between 2001 and 2010, and now account for 15.7% of global postal revenues.

The UPU said financial services are also taking an increasing prominence for postal operators, comprising 17.3% of global postal revenues in 2010, up nearly four percentage points compared to 2001.

UPU statistician Matthias Helble said: “As Posts diversify their activities, they either introduce new products and services or focus on expanding traditional ones. So, while revenues from letter post are decreasing, we see upward trends in those generated by parcels, logistics and postal financial services over the last 10 years.”

The UPU said while letter volumes are generally declining around the world, they are still “booming” in some countries. Some of the biggest increases in letter volumes have been seen in Lebanon and Albania from 2001 to 2010, with increases of 281% and 314% respectively.

UPU economist José Ansón said development of letter volumes no longer correlate with development in country economies.

“For a long time, economic growth was helping boost letter post volumes in industrialised countries. Today, this close relationship between economic growth and postal traffic is not so evident.”

The UPU pointed to e-commerce as a big driver for parcel and logistics revenues, with the world now sending nearly 6.1bn domestic and 43.6m international parcels each year.

Among some of the Posts with the biggest growth in parcels since 2001 has been Philippine Post and India Post. Philippine Post has seen parcel and logistics services jump from 8% share of revenues in 2001 to 77% in 2010. India Post has seen parcel and logistics go from a 3% share of its revenues to 40% in 2010, the UPU said.

The UPU named Hungary’s Post, Magyar Posta, as having a particularly dramatic increase in financial services revenue share, increasing its share of revenues from financial services from 39% in 2001 to 59% in 2010.

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