The week that was: 22 July 2011
Posts in Russia and Brazil plan massive investments in modernisation, while others in Britain and America look at huge cutbacks… It was the best of times, it was the worst of times in the pages of Post&Parcel this week, as we sum up the top stories of the last seven days…
Russian Post is doubling its investment in upgrading processing infrastructure and its post office network, in order to dramatically speed up delivery times.
The company is ready to invest 14bn rubles ($500m USD) of its own and borrowed funds into new high-tech delivery services across its network. But, at the same time the Post is also seeking government assistance – without which, it says, improvement projects can “stretch over many years”. Yesterday a big step forward was made with approval from the Public Council within the Federal Communications Agency for plans targeted at improving delivery of periodicals.
At the moment, Russian Post is struggling with outdated equipment and systems, in a network where two thirds of facilities have been operating for at least 20 years.
Brazil’s Correios plans to invest R$4bn ($2.5bn USD) over the next five years to improve postal services and modernise infrastructure.
The plan, which has been submitted to the government, was announced last week as Wagner Pinheiro revealed a 48.2% increase in profits for his first six months as president of Correios. From next year, the Post’s investment programme will aim to modernise and expand the Post’s branch network, vehicle fleet and information technology, as well as upgrading and building new distribution centres and cargo terminals.
The new Correios president has already overseen the start of modernisation of operations, along with a major effort to hire 10,000 new workers to cope with a shortage of staff. Some 3,700 new apprentices have already been hired through the recruitment program.
Meanwhile, Royal Mail has confirmed that it plans to cut 550 jobs in the Midlands, as it reshuffles its operations across the UK region.
The operator said that formal proposals are in place to close and sell its mail centre in Leicester, with other mail centres in Derby and Worcester being downgraded to delivery offices. In addition, it is proposed that the Ilkeston and Heanor Delivery Office would be incorporated into Derby. Similarly, it is proposed, the delivery offices at Droitwich and Worcester city centre would be relocated to the current site at Wainwright Road, Worcester.
In light of the plans, Royal Mail said that its workforce of 17,500 people across the region will be reduced by 550. However, a company statement said that “everyone who wants to remain in the business would be able to do so”.
The US Postal Service looks likely to see formal approval on plans to review thousands of post offices across the United States for possible closure.
Sources on Capitol Hill have suggested that the request could be made around July 27. Postal Regulatory Commission (PRC) chairman Ruth Goldway told Post&Parcel that a commitment has been made to USPS to complete an advisory opinion on the matter within 90 days of the USPS filing. The US Postal Service has already briefed staff in both the US Senate and House of Representatives on the retail network review, which forms part of a major effort to “right size” the retail network in the light of declining mail volumes and a reduction in the public use of post offices.
Next Tuesday (July 26), Postmaster General Pat Donahoe is expected to reveal a list of around 2,800 post offices and 700 stations that will be reviewed for possible closure – and ideas on alternative forms of access to postal services for communities faced with the closure of their post office.
And Finally…
Have economic woes made the industry lose its spectacles when it comes to the long-term vision?
Have crisis situations pushed business planning dangerously towards the short-term?
Mail & Express Review columnist Howard Wright gives us a little perspective »
