A lot has been happening in the past year and there has been plenty to talk about: 2020 has been dominated by the COVID-19 pandemic, which of course made it one of the major topics at this year’s Parcel+Post Expo.
The Impact of COVID-19 on the Postal Industry
The coronavirus is an unprecedented crisis with dramatic economical impacts – not just on postal operators, but on all industries. A first and striking consequence of the pandemic has been its widespread disruption to international supply chains. Strict constraints have been posed on international transport, particularly on air traffic. Therefore, cross-border shipping was almost impossible during the first few months of COVID-19. As a result, global trade decreased by 3 % in the first quarter of 2020 (The Economic Times, May 2020) and a vast amount of postal items were stranded in “logistical no man’s land”.
Postal operators throughout the world decided on a number of important measures to mitigate the impacts of the disruptions in the global supply chain. First of all, extensive safety measures for employees and customers had to be applied, such as a daily disinfection of buildings, plexiglass partitions at counters and the set-up of sanitization tunnels. Furthermore, methods and tools were developed to ensure contactless delivery. Some of these measures were a necessary and obligatory follow-up to the public health measures, others were aimed at reducing the direct impact of disruptions on the service. The redeployment of staff after implementing health and safety measures was an effective technique to manage a sudden state of normalcy. However, these additional security steps also led to an increased cost of mail processing.
Challenges and Opportunities for the Postal Industry
The pandemic has accelerated the decline of letters and growth of e-commerce parcels, due to an increased number of people shopping from home. Last-mile delivery companies have scaled-up dramatically because of the recent volume increase. For many postal operators it was Christmas-like peak time every day. According to Frank Yu (principal consultant at Pacific Consulting Group), they had to deal with parcel volumes up 90 % compared to the same time last year. This led to additional problems, such as capacities being overwhelmed, staff being burned out and service performance declining.
Furthermore, COVID-19 made clear how much the postal network depends on the global transportation systems. Closed lanes and rate increases are still an issue for cross-border shipping of mail and parcels.
However, postal operators are taking these challenges as an opportunity to evolve, adapt and speed up transformation. As Bishar Abdirahman Hussein, director general of the Universal Postal Union (UPU), said: “The postal organizations have been facing many challenging situations throughout history and they have always found a way to adapt and transform.” Thus it showed in this crisis: COVID-19 has been unprecedented and the postal industry had to innovate and come up with new ideas. Hussein: “We have to be innovative and come up with new strategies and business plans to deal with these kinds of things.”
Recover. Rebuild. Emerge Stronger Together.
A valuable lesson was learnt, even though it was painful. The postal industry has become more agile in transforming operations. During a time when most airlines are still grounded, they had to find other modes of transportation and make sure that deliveries – particularly across borders – are not interrupted. Therefore they have been working closely with the governments and customs organizations, such as border securities. Not only has the network between post and governments become stronger, but also between post and consumers. The Postal Union was also providing logistical and technological support in terms of advanced data information systems, to let member countries know when mails are ready and when they are supposed to be delivered. As Bishar Abdirahman Hussein puts it: “Innovation and adaptation are some of the lessons we have learned from COVID-19. We have to constantly be driven by the demands of the market, our customers and our clients. Therefore, we need to have innovation to meet the expectations of our society.” Freight and logistics expert Yu agrees: “Postal operators can seize this unique opportunity to address complex legacy structural issues in order to transform their business and emerge from the pandemic with more efficient operations.”
Post COVID-19 focus points
As a long-term strategy for businesses to respond to COVID-19, companies should take the opportunity to perform transformative changes. These opportunities align with one core thing: visibility. Yu: “With a touch of a button, we can now order everything. People expect immediate action when it comes to delivery and transparency. Shipments are expected to be seamless, on time and with no hassle.” Operators are therefore required to develop their transformation timelines to successfully improve customer experience and boost profitability.
Kizy Tracking has developed a device that helps you achieve all of this by making supply chains visible: the K-2 tracker is an active solution that transmits real-time data of geolocation and movement from anywhere in the world. It comes with long autonomy, a small size and high accuracy. It meets the specific requirements of a great number of industries: from automotive, postal and courier to food and beverages. Visibility in supply chains helps companies to effectively respond to disruptions and prevent incredible financial losses – not just in times of a pandemic, but always.
Transparency in the transport network with live tracking
Kizy Tracking will host a webinar on November 4, 11-11:30 am CET, looking at issues such as how to keep Santa’s Christmas journey efficient in times of a pandemic. How to identify bottlenecks and keep your customers happy at all times. Interested?