Asian post liberalisation will be different from that in Europe
In the next presentation in the postal session, Perry Chao, senior vice president of UPS’s Asia Pacific region, highlighted the way the internet had ‘forever changed the competitive landscape’ for express operators, for example by enabling customers to research different suppliers and choose between them.
With the supply chain increasingly global in nature, customers also now demanded ever more complex solutions, meaning that the days of the stand alone provider were over. Instead, integrators like UPS offered a portfolio of solutions through partner companies.
He cited examples such as a computer manufacturer which might design its PCs in Singapore, manufacture the CPU in Taiwan, source the disk drive in Korea, and ship all to China for final assembly before delivering to a US customer.
In such cases, the solution might involve UPS’s express parcels arm, UPS Logistics, and its forwarder Friz, Chao said. UPS had thus moved from being a package delivery company to a supply chain manager, inventory manager and warehouse manager.
Chao admitted that like the integrators, post offices were key enablers of commerce, but said technology had introduced a wide range of competitors to them, including private express companies and private postal operators.
This changes was only starting in Asia, however, prompting the question of whether Asian post offices would rise to the challenge, with faster services and better IT infrastructure. The latter would require a huge investment, he noted, one which might stretch even the resources of a government-backed operation.
Chao warned against taking parallels with the European market too far, however. Asian countries were separated by water, he pointed out, a fact which would make the kind of cross border delivery networks being developed in Europe hard to imitate. Instead, he expected post offices in Asia to remain dominant in national mail, while the integrators dominated the international parcel market. To this end, Chao called on less liberalised countries in the region, such as China, to open up their express markets, noting that ‘global commerce is like a river: it flows alon ghe path of least resistance, that is, through counties with lower regulation and better transport and IT infrastructure.’
Two key areas in which governments could help were deregulating air services and introducing electronic customs clearance, he said. UPS welcomed Koreas open skies policy for cargo, which made it well placed to serve as a hub for North East Asia, he added.
