Swiss Post open to international alliances

Swiss Post will seek more operational alliances in future but there is little prospect of any all-encompassing strategic alliance or even part-privatisation, according to a senior executive. The comments follow a move by Swiss authorities towards restructuring the Swiss national postal operator into a public limited company with employees on contracts rather than staff with civil servant status.

The Swiss government decided earlier this month to commission a report into the future structure of the country’s postal market, including the legal reorganisation of Swiss Post. Key issues include the future extent of universal service obligation in Switzerland and need to retain a partial monopoly in future to finance this.

Swiss Post has welcomed the plan as necessary to create the conditions for fair competition while ensuring “a quality and need-based basic postal service provision”. This would ensure the postal company’s long-term competitiveness alongside postal coverage for the Swiss population and economy. While EU states further opened their postal markets to competition in January 2006 by reducing the domestic letter monopoly limit from 100g to 50g, Switzerland still has a monopoly up to 100g.

Outlining Swiss Post’s alliance strategy at last week’s World Mail & Express Europe conference in Paris, Beat Friedli, head of business consulting, described the plan to make the organisation into a plc by 2009 as “an important step”. But the prospects of a stock market flotation or partial sale to a strategic investor had receded, he noted. Similarly, Swiss Post was not inclined to any group-level cooperation with another European postal operator due to the political and practical difficulties of such a grouping. “Swiss Post wants to retain its independence at a group level,” Friedli said.

Cooperations in specific business areas would be the focus, instead. “Swiss Post will continue its partnerships at a divisional level,” Friedli commented. “Swiss Post will make acquisitions or alliances at a business area level or below.” This would reduce risk and investment levels while opening up new growth opportunities, especially in fast-growing niche businesses. Swiss Post could offer nationwide domestic distribution in Switzerland for other companies, for example.

The partnerships with TNT for international express and GLS for international parcels would continue, Friedli stressed. “Both alliances work perfectly,” he said. Asked about the company’s logistics activities, Friedli said that Swiss Post now had full domestic coverage in Switzerland and could be interested in an international partnership.

Source: CEP-Research