Hybrid Mail: Effectively Transforming Postal Operations
Hybrid Mail: Effectively Transforming Postal Operations
Read MoreTag: Russia
New Russian Post CEO targets modernisation as losses rise
The new head of Russian Post, Andrej Kazmin, has unveiled a package of measures to modernise the vast postal service and make it more competitive following increased losses last year. But privatisation is not on the agenda.
Priorities will be to offer a wide range of services, to improve the profitability and quality of mail services, to expand financial services and to modernise the IT and infrastructure, Kazmin said at a two-day high-level meeting of the Russian Ministry of Communications and Information Technologies earlier this month.
Russian Post said it increased mail volumes by 14 pct and parcel volumes by 25 pct last year. Its EMS express shipment volumes increased 42 pct in comparison with express market growth of 37 pct. The company’s 2007 revenues increased by 23 pct due to the higher volumes. However, Russian Post ended 2007 with a loss of RUB 5.8 billion (EUR 158.94 million) compared to a RUB 4 billion deficit (EUR 109.61 million) in 2006.
According to Kazmin, Russian Post’s main goals for 2008 include improving the enterprise’s economic efficiency, providing standard delivery of correspondence and freight to and from any part of the Russian Federation at available tariff rates, establishing modern infrastructure and developing financial services within the postal service system.
In terms of the growth factors and prospects for this year, IT is seen as an important factor for the development of postal services. In 2007, Russian Post extended computer technology with a 35 pct rise in the number of terminals at post offices. In addition, it opened over 3,000 Internet public access outlets increasing their total number to 23,000, the Russian Post said.
Read MoreRestructuring of Russia’s postal system will take up to five years
Post in Russia has had a difficult time in recent years, both for users of the antiquated service and for the government underpinning its financial position. It lost USD 186 million in 2007. But this is set to change with the appointment of a new head and a renewed focus on service and infrastructure.
One of the oldest and largest government owned enterprises – Russia Post – is entering a reconstruction phase. Currently it includes almost 90 affiliates with 42,000 outlets, but even these figures don’t help it to make profit.
The latest move to do something about the post was to place former Sberbank CEO Andrey Kazmin in charge. He says the first thing to change will be the financial losses.
“Russia Post will not become a bank in the future. It will have a range of services, but the main service will be delivering post. Financial services will be a part of these. And we do plan to increase the profitability of Russia Post by enlarging the number of financial services and updating the sector,” Kazmin said.
It will be focusing on services such as money transfers and loan payments, and will offer some banking services in regional Russia.
“Currently, Russia Post has a lot of problems. And it will take from three to five years to finish the reconstruction process. However, by the end, with the financial services in place, it can compete with Sberbank in places where there are no banks at all,” said Anatoly Aksakov, the head of Association of Regional Banks.
The restructuring of Russia’s postal system will take up to five years, according to experts.
It’s expected that more concrete proposals for Russia Posts transformation will be unveiled in March.
Read MoreRussian Post to remain state-owned company, official says
Russian Post is to remain a state-owned company, IT and Communications Minister Leonid Reyman told journalists during a meeting of the ministry’s board today, adding that the ministry had yet to decide whether Russian Post needed to be converted into a state corporation or into a joint-stock company fully controlled by the government. Commenting on the possible deregulation of the postal sector, Reyman noted that if private-owned companies were allowed access to the market, it was necessary to ensure that Russian Post did not become an operator of its least efficient segments.
Read MoreDHL continues to expand its service points network in Russia
DHL is expanding its presence in the Russian market and announces opening of two more service points in Moscow and one in Kazan.
DHL network currently encompasses over 500 cities in Russia. Opening of the new offices is part of the program to expand DHL’s service points network. This program has been developed in line with the global strategy of the company, which sets provision of the most reliable and accessible service as one of DHL’s priorities. In 2007, DHL opened a total of 12 service points across Russia.
The new offices stand out both for the range of services provided and technical capabilities. They are styled to meet the company-wide requirements for such centers all over the globe and provide a vivid example of DHL corporate style. All DHL service points offer the customers a full range of express products both within Russia and abroad.
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