THE South African Post Office (Sapo)‚ faced with declining mail volumes mainly due to the onset of the internet‚ is due to follow clients online with a planned R800-million expenditure to be used in building digital platforms and modernising its infrastructure.
Sapo is looking to turn to profitability after years of decline‚ worsened by work stoppages costing it more – as well as ingrained problems. Last year mail and registered letter deliveries were down 3% and 15% respectively.
New tariffs came into effect this week. The Independent Communications Authority of South Africa (Icasa) has approved a general increase of 5% on unregulated tariffs‚ aimed at items weighing more than 1.2kg.
A 6% hike was granted for regulated tariffs‚ meaning that the cost of sending a basic letter should not exceed R3. Other services to benefit from the tariff increase include courier services.
Sapo offers services such as logistics‚ mail services and banking through the Postbank. With aggressive cost-cutting and a balanced revenue mix‚ Sapo would stem its losses within a year‚ chief financial officer Khumo Mzozoyana said this week.
Like many others the SA Post Office has been hard-pressed to survive against the internet.
The company would grow its electronic-business unit and devote more resources to digitisation of services‚ Mzozoyana said. “We plan over a three-year term and our IT (information technology) spend is going to be over R800-million to create platforms that will serve our clients and also provide us with an opportunity to innovate.”
The proposed e-business encompasses a secure online system to support bulk postings and the Trust Centre‚ a platform that provides user authentication and also ensures trust and legal status in electronic transactions through the use of digital certificates.
In the year to last month the Post Office suffered a loss of R178.6-million on a turnover of R5.7-billion‚ a performance attributed to mismanagement and protracted labour unrest.
It incurred R2.1-billion in irregular expenditure relating to procurement contracts. In 2012 the company sought a R5.1-billion bail-out from the government through disgraced former communications minister Dina Pule.
A further loss was likely in this financial year‚ said Mzozoyana. A new strike and heavy reliance on a single source of revenue topped the Post Office’s challenges.
“Labour issues destabilise the company. With the volatility you keep sending a wrong message to clients. Second is the revenue mix; there is a huge dependency on traditional mail‚ we need to grow logistics services and also financial services.”
Mzozoyana said the past three work stoppages had cost the company more than R200-million and the most recent strike‚ which lasted two weeks‚ cost it R23-million. — BDLive
New path to profit
Sapo is looking to turn to profitability after years of decline‚ worsened by work stoppages costing it more – as well as ingrained problems. Last year mail and registered letter deliveries were down 3% and 15% respectively.
New tariffs came into effect this week. The Independent Communications Authority of South Africa (Icasa) has approved a general increase of 5% on unregulated tariffs‚ aimed at items weighing more than 1.2kg.
A 6% hike was granted for regulated tariffs‚ meaning that the cost of sending a basic letter should not exceed R3. Other services to benefit from the tariff increase include courier services.
Sapo offers services such as logistics‚ mail services and banking through the Postbank. With aggressive cost-cutting and a balanced revenue mix‚ Sapo would stem its losses within a year‚ chief financial officer Khumo Mzozoyana said this week.
Like many others the SA Post Office has been hard-pressed to survive against the internet.
The company would grow its electronic-business unit and devote more resources to digitisation of services‚ Mzozoyana said. “We plan over a three-year term and our IT (information technology) spend is going to be over R800-million to create platforms that will serve our clients and also provide us with an opportunity to innovate.”
The proposed e-business encompasses a secure online system to support bulk postings and the Trust Centre‚ a platform that provides user authentication and also ensures trust and legal status in electronic transactions through the use of digital certificates.
In the year to last month the Post Office suffered a loss of R178.6-million on a turnover of R5.7-billion‚ a performance attributed to mismanagement and protracted labour unrest.
It incurred R2.1-billion in irregular expenditure relating to procurement contracts. In 2012 the company sought a R5.1-billion bail-out from the government through disgraced former communications minister Dina Pule.
A further loss was likely in this financial year‚ said Mzozoyana. A new strike and heavy reliance on a single source of revenue topped the Post Office’s challenges.
“Labour issues destabilise the company. With the volatility you keep sending a wrong message to clients. Second is the revenue mix; there is a huge dependency on traditional mail‚ we need to grow logistics services and also financial services.”
Mzozoyana said the past three work stoppages had cost the company more than R200-million and the most recent strike‚ which lasted two weeks‚ cost it R23-million. — BDLive
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