Express mail and delivery firms diversifying in the Czech Republic
With the European and Czech market of postal services slated to be fully liberalized by 2009, the Czech state-owned post office Ceska posta (CP) continues broad remedies to withstand the impact of competition, which is driven by the market to boost services, increase quality and reduce prices.
“Within two years, Ceska posta will be a different company,” said Ivo Mravinac, the director of communications with CP. The ongoing changes are concentrated on two major levels — the internal restructuring of the company and the conversion into joint-stock company.
For the past couple of years, the Czech government harbored plans to privatize the company and finally last fall the board of trustees of CP charged company CEO Karel Kratina to work out the details of the transformation into a state owned joint-stock company. “There’s no time-schedule for the whole process or for its individual steps,” Mravinac said, adding that the final deadline is Jan. 1, 2009, when the Czech postal services market is to be fully liberalized, but that the company hopes to reach its target sooner.
Apart from administrative changes and more centralized management, CP plans to revamp and spice up its services to be more competitive on the market with such tailor-made services as mobile phone or e-mail notification about package delivery, and the option to decide when and where the package should be delivered.
“There will also be changes at the counters as well, and soon all these changes will be visible,” Mravinac said, pointing out that the company is working on detailed projects for such improvements. October’s mystery shopping results suggested the areas for improvement on which CP needs to focus. While the company, in general, gained four points compared to the year before, totaling 69 points out of the possible 100, the business skills of its employees rated worse than the year before. “We need to think about system changes. There are simply too many duties on the [people behind the] counters,” said Iva Steinerová the director of strategy planning at CP.
CP previously stated its plans to change its strategy and wants to branch out of its traditional post offices to business and shopping centers. The company is going even further by utilizing its dense network of post offices to reach customers by providing exceptional services they might not need every day. As of January 2007, the CP offers statements from the central land registers and soon it plans to offer statements from the central business register as well. In the future, it plans to offer statements from other central registers, such as criminal, contract, trade certificate and debt free certification.
–Labor Code and e-toll effect
The new Labor Code, which came into effect on Jan. 1, 2007, is more likely to affect larger companies such as CP, due to limits on overtime work, cancellation of extra work and growth in severance pay. The necessary weekend work alone will now cost CP an additional tens of millions of crowns, according to Dita Václavíková, the CP spokeswoman.
In the meantime, logistic company PPL CZ — which was bought by Germany’s Deutsche Post World Net subsidiary DHL Express division in December 2005 — continues to increase its quality of services. Last year the company offered a “documents back” service, in which the receiver of the delivery confirms that the package was handed over and the messenger returns the signed document back to the sender by the next day. In addition, PPL, which operates under the brand name Professional Parcel Logistic, launched an SMS order placing system for its customers on Jan. 3, 2006.
While, generally, the postal services market drives prices down quite aggressively, some providers have been or will be forced to increase prices due to the e-toll system, launched on Jan. 1, 2007, on 970 kilometers of highways. As of that date, PPL increased the prices per one kilogram of delivered package by KC 0.26, according to its Web page.
–Off beat services
With services such as delivery tracking and online or SMS ordering becoming necessary to retain customers, Czech messenger service providers are increasingly turning to areas that weren’t at the core of their business a decade ago. “The more services we offer to customers, the bigger chance we have to succeed,” said Karel MysliveCek, the operational director of Express Parcel System (EPS).
While the general trend to expand services is imminent, messenger companies are adding services not directly connected only to the management and logistics of deliveries, according to MysliveCek.
EPS decided to build on its successful flower delivery service called E-flowers.cz, which last year generated over 200 orders on Valentine’s Day alone. For this year, the firm decided to market special packages for those who wish to send something more than just flowers to their loved ones. “The Valentine’s packages are completely new, we just started to offer them [as of Jan. 15],” MysliveCek said. In addition to flowers, packages include classic items such as heart shaped red pillows, teddy bears, chocolates, heart shaped cakes, and also cinema, dinner or sauna vouchers. Some of the more exotic packages include parachuting, airplane or balloon sightseeing trips, a weekend in Paris and golf lessons.
Some options seem to defy in the proper romantic spirit. A flight in a jetfighter and the chance to drive a tank are listed, and the company is ready to arrange anything clients wish for, according to MysliveCek. “We plan to offer similar packages for other holidays throughout the year,” he said, but declined to provide any details.
Another courier service provider, Globus Car decided to cater to customers who are unable to drive their own car, but are reluctant to take taxis and leave their vehicle behind. Last year the company started to offer transport of both the person and his or her vehicle, and with the new traffic law’s stricter point system and penalties, the company attracts enough partygoers, or simply overworked managers, to gain a competitive advantage.
