Post Office consolidates courier freight divisions

Wiseman Khuzwayo

The SA Post Office was consolidating the four brands in its logistics division to improve efficiencies, cut costs and render a better service to customers, Nhlanhla Dube, the acting managing director of wholly owned subsidiary Courier Freight Group (CFG), said on Friday.

This would save the Post Office 10 percent in transport costs, amounting to more than R300 million a year.

Dube said mail volumes were falling as correspondence through e-mail replaced letters.

In the financial year to March 2011, the Post Office declared a 3 percent increase in revenue to R6.1 billion but cash flow declined by 46.9 percent to R157m, and profit after tax fell by 48 percent to R152m.

Dube said the Post Office had been working on the consolidation since 2008.

The four brands in CFG are XPS, Speed Services Couriers, PX and Docex, which are the parastatal’s most profitable services.

In 2010/11, CFG’s operations generated R1.25bn in revenue, 20 percent of the group total.

Dube said the courier operations employed 1 400 people and operated 1 250 vehicles.

He said: “We have done this [consolidation] without retrenching a single soul.”

The problem was that there had been a lot of duplication between the brands.

“Instead of using four vehicles to one destination, we now use one,” Dube said.

PX, the backbone of CFG, has 9 000 containers, and each truck carries 12 containers to a destination. Dube said the cargo now included mail, in addition to urgent documents and packages.

Speed Services Couriers, which provides a door-to-door service in urban and remote areas, moves almost 1.1 million parcels every month.

“We are now able to gain efficiencies and deliver faster to our customers,” Dube said.

Pharmaceutical distributors use CFG to deliver chronic medication.

Dube said the group moved 3 000 medical packages daily, with the biggest contractor being the Government Employees Medical Scheme.

One has to wonder why the crisis in the delivery of textbooks to schools in Limpopo took place with CFG on hand.

Dube said the group had in the past delivered books to 16 000 schools in three weeks.

It has also delivered payslips for provincial education staff in the Eastern Cape. Whereas teachers used to get their payslips up to three months after payday, CFG delivered five days before they were paid.