Zimpost Faces A Tough Year As Mail Business Declines

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Zimpost is expecting the contribution of its mail business to annual turnover to decline to 22 percent next year from 30 percent this year due to a decline in volumes from traditional clients and overall growth in other areas. Zimpost managing director Dr Douglas Zimbango told the Herald Business last week that there is room for improvement as the company begins to benefit from its new products.

“In the current year mail business revenue is expected to close at 30 percent of total revenue. The 2015 mail revenue contribution is expected to decline to around 22 percent as a result of an overall growth in other areas and a decline in volumes from traditional clients who are moving to prepaid platforms thereby eliminating the need for bills,” said Dr Zimbango.

He said the electronic substitution will also affect the contribution of mail to overall revenues.

Dr Zimbango said the mail business has declined 86 percent from 2000 to date. Zimpost has three post offices that are at various levels of construction but has now decided to expand through franchising, mobile post offices and agency arrangements, in line with the need to streamline our cost structures.

One mobile post office was launched in the year and seven caravans were ready for deployment once all the registration exercises are complete.

Zimpost’s turnover for 2014 will remain flat at $20 million but there is hope for better fortunes in 2015 as new products begin to perform.

Zimpost introduced an array of products with the idea of migrating from traditional mail business and these include ZipCash, community information centres among others.

He said 2014 revenues will remain flat if not down on last year but as new products come on stream in 2015, they expect sales to go beyond the $20 million mark.

However, in line with the Universal Service Obligations, contribution to upstream and downstream players will be much more as Zimpost will be reaching more clients through the use of ICTs and empowerment programmes through franchising and sub-offices operations.

Dr Zimbango said the company is currently working on a number of initiatives to improve revenue through a 24-hour platform that will enable virtual operations.

“As we move forward, Zimpost continues to take note of the fact that its future lies outside the traditional letter post business and so will continue to innovate and automate so that the post remains relevant.

“This will insure that we move in line with our philosophy of going beyond the envelope,” said Dr Zimbango.

This year Dr Zimbango told journalists that Zimpost is investing about $5 million on completing automation of its offices across the country to make the functioning of the new products on the market more convenient. He said about $4 million has been invested so far towards procurement of the automation equipment. Dr Zimbango said the company will not automate all its outlets for economic reasons.

 

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