Canada Post to begin phasing out doorstep delivery this autumn
Canada Post said today that its plan to end door-to-door mail delivery in Canada will be phased in from this autumn. The state-owned company first announced its intention to switch to community mailboxes last December. The plan would see about a third of Canadian households moving to cluster boxes over the next five years, helping Canada Post cut delivery costs in light of its dwindling mail volumes. Other households already use some form of centralised mail delivery system.
Canada Post estimates that the nationwide use of community mailboxes will save it between $400 and $500m a year in operating costs, with deliveries to community mailboxes costing half as much as delivering mail to the door.
Today Canada Post revealed the first 11 communities that will switch to community mailboxes this year.
These include more than 10,000 addresses in Calgary, 12,500 addresses in Winnipeg, 7,900 addresses in Ottawa and nearly 10,000 addresses in Halifax.
Switch
To begin with, only certain neighbourhoods within large cities will be affected, and most businesses will keep their delivery to the door. In smaller cities nearly all households and a higher proportion of businesses will make the switch.
Customers in rural areas with a mailbox at the end of their driveway will not be affected, and mail delivery to lobbies of apartment buildings will continue unchanged. Businesses that receive a large volume of mail, or are located in well-established business districts will also keep their existing delivery arrangements.
Additional solutions may be offered to Canadians with mobility difficulties.
Canada Post said neighbourhoods chosen for the initial phase are close to areas that already have community mailboxes, where operations are already set up to deliver to this kind of delivery point.
The company said today: “Affected residents will soon receive an information package from Canada Post in the mail. It will tell them how they can express their priorities and preferences about their new delivery method. Using the feedback from residents, Canada Post will work with local municipal officials to determine suitable locations for the community mailboxes.”
The Community Mailbox plan will affect about 5m addresses in Canada in total.
Community mailboxes will include individual locked compartments dedicated for each address, big enough to take more than 50% of parcels and packets mailed in Canada. Units also include an outgoing mail slot and larger parcel compartments that can hold more than 80% of the parcels and packets mailed in Canada. When a parcel is left in one of these compartments, a key to the compartment is then placed inside the mail compartment for the corresponding specific addressee.
Strategy
Canada Post’s plan to phase out door-to-door mail delivery comes as part of a five-part strategy revealed in December, which seeks to turnaround the company’s financial troubles in the light of declining mail volumes.
With transactional mail volumes falling 7.3% year-on-year at the moment, research from the Conference Board of Canada last year predicted that on the existing course, Canada Post would be making a $1bn annual loss by 2020. The company made a $134m loss in the first three quarters of its 2013 financial year, and also faces a $5.9bn solvency deficit in its pension scheme.
The company is also introducing a new tiered pricing structure for domestic letters, in which prices are higher for those buying individual stamps, with discounts for those that use the mail most.
The strategy also includes the aim of opening more franchised postal outlets, and automating the parcel and mail sorting process.
The work force will be reduced by 6,000 to 8,000 positions, mainly through attrition, as the changes are implemented.
