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UPS – TNT Express Merger – Real Gains For UPS Come in Asia

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UPS announced an agreement to purchase TNT Express in an all cash offer.  Most of the stories focus on the impact on European competition. However, the real advantage to UPS is how the merger allows it to quickly gain market share in Asia where UPS and TNT are both small players in a larger pond. Market Shares in Asia Deutsche Post Group Results Presentation March 8, 2012 The following chart illustrates current market share in the time definite market in Asia.  The chart shows that prior to the merger both TNT and UPS were relatively small competitors compared to either DHL and FedEx.  With the merger, the combined Asian market [...] Read more »

Could Royal Mail’s Approach to Postal Retail Services Work in the United States?

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One of the major issues related to the United States Postal Service is the future of its retail infrastructure. The issue of the future of retail is important everywhere. In Great Britain, where 97% of all Post Offices are contract operations, the issue of the future of retail postal access has been a major issue because Royal Mail had reduced the number of retail locations by 25% over the past decade. Royal Mail Ltd, runs its retail operations as a separate, for profit entity called Post Office, Ltd. This subsidiary currently has a ten year exclusive contract to sell Royal Mail Services through a franchise network of retail counters as [...] Read more »

Privatization is Not Free

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Privatization of the Postal Service has received recent attention in a speech by Governor Tim Pawlenty and the editorial page of the Washington Post.    Neither presentation provided any indication of an understanding regarding what it would take to privatize the Postal Service either legally or financially. In an earlier post commenting on Governor Pawlenty’s speech, I noted that privatization would likely require resolving the retiree issues in the Postal Service’s favor.  Confirmation of that conclusion is coming from Great Britain.  The Financial Times reports that Ed Davey, postal affairs minister, told the Commons that, to put Royal Mail on a sustainable commercial footing, its balance sheet would need to be [...] Read more »

Marketing Mail in a Competitive Market

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Third Sector reported the results of a TNT Post announced the results of a survey that it conducted in Great Britain on the effectiveness of mail for gaining contributions by mail.   The results illustrate not only why mail is an effective marketing tool for non-profits but also how postal operators in competitive markets work to expand sales. Findings of the TNT sponsored study One-third of people who make donations to charity are prompted to do so by receiving direct mail from the organization. 57% of those who respond to mail appeals respond by mail. 87% of those who want more information get that information on-line.  Only 10% use the mail [...] Read more »

Privatizing the Post

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In the United States, the policy debate is over how the Postal Service will survive past the end of the fiscal year.   In Great Britain and Canada the debate is now respectfully when and if the Post should be privatized. Royal Mail clearly is on a path toward privatization. In July, Sky News reported the government hired advisers on a potential Royal Mail sale. More recently, Royal Mail hired Moya Green, former CEO of Canada Post who the Times (London) steered the “organization to a trebling of its net profit to C$281 million (£183 million), despite a 5.1 per cent drop in revenue.“  Ms. Greene also served as “Assistant Deputy [...] Read more »

Amazon: Avoiding the Post Office

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In Rethinking the Parcel Market, I noted Amazon’s effort to offer same day delivery and what that means for UPS, FedEx and the Postal Service in the United States. Today’s Times Online reports that Amazon has launched “a secret search for bricks-and-mortar stores to support its rapidly growing website. It is understood to be scouring the country for high-profile sites.” According to the article, Amazon is not looking to open retail outlets where customers can buy goods that the store has in inventory. Instead, the stores will provide a delivery point for customers that order larger items that mail or truck delivery is inconvenient. [Monday 12/7/2009 Amazon has subsequently denied [...] Read more »

Mailing to Santa

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Santa Claus’s Main Post OfficeArctic Circle, Finland Given all of the troubles the USPS is having with mail to Santa this year, I took a quick look at how it is handled in other countries. Mail to Santa is a worldwide phenomena and countries close to the North Pole all receive thousands of pieces of mail addressed to Santa. Many have formalized programs to answer the letters. A couple of Posts have websites that help children (and their parents) send letters to Santa. All of these countries reflect English culture. Here are three. Australia Post - handles over 100,000 letters to Santa. They have a special address and Postal Code. [...] Read more »