Presentation of Posten AB's new service network

Transcription

1 PTS-ER-2004:38 PTS-ER-2006:37 Presentation of Posten AB's new service network a presentation in English of PTS reports on access to the new postal network

2

3 Contents Summary...3 Background...3 The assignment of the National Post and Telecom Agency...4 Regulatory framework...4 The new service network...5 Structure of the service network...6 Posten AB's experiences...7 The rural delivery service...8 Increased accessibility...8 Posten AB's agreements with outlets and agents...9 Consumer reactions...9 Conclusions...10 Summary This English version summarises two reports about Posten AB's new service network that were published by the National Post and Telecom Agency (PTS) in 2004 and The aim of this document is to describe the development of Posten AB's new service network, which is largely based on franchises rather than traditional post offices. Today, consumers have access to various postal services through grocery and petrol station chains. This document describes Posten's experiences from over five years of operating the service network and the changes made during this time. The National Post and Telecom Agency (PTS) is the supervisory authority for the postal sector, for which reason the authority's assessment of the new service network is also included. This assessment is based on the regulatory framework which must be complied with by the operator allocated responsibility for providing a universal postal service. The reactions of consumers to changes in the service network are also described. Background One of the most sweeping changes in the history of the Swedish postal system was Posten AB's decision to replace traditional post offices with a nationwide network of representatives consisting of shops and service establishments. From this point forward, consumers were to obtain postal services from these establishments instead of from the post offices. Restructuring was initiated during the summer of 2001 and concluded a year later, when the new service network had been implemented throughout the country. The high cost of premises was the main reason for Posten AB's decision to close down the old network of post offices. Customers mainly visited post offices to National Post and Telecom Agency

4 make and receive payments, not to utilise postal services. In light of the more stringent demands for streamlining and cost efficiency, Posten AB decided that the customer base was not sufficient to justify the high level of expenditure for its own network of post offices, particularly since postal services would have to bear these costs. The assignment of the PTS The new service network was evaluated by PTS on two occasions. The results were published in reports in December 2004 and October The reports focussed on practicality and whether the new solution fulfilled the standards provided by the overall government guidelines for a universal postal service. For example, this may involve the supply of services and accessibility to service establishments. The latest review is a form of follow-up of the report presented in 2004, but with a particular emphasis on the adaptation of service establishments for people with disabilities and the changes brought about by the new agreements that Posten AB has entered into with outlets and agents in the past year. PTS mainly reviewed accessibility to four types of services that were considered to be of key importance to the Swedish population. The starting point was the basic requirements of a universal postal service described in the regulatory framework, namely to be able to: post letters; purchase stamps; send and receive parcels; and send and receive registered items of mail. Regulatory framework The regulatory framework, which regulates the Swedish postal market in various ways, comprises the Postal Services Act (1993:1684), the Postal Services Ordinance (1993:1709), the operators' licence terms and conditions, and Directive 97/67/EC of the European Parliament and of the Council "on common rules for the development of the internal market of the Community postal services and the improvement of quality of service", hereafter referred to as the Postal Directive. There are no detailed regulations in Sweden stipulating how the operator which is obliged to provide the universal postal service should set up the service network in order to meet the needs of society. The national regulatory frameworks of other countries provide a more specific indication of how postal authorities or companies should set up a service network to ensure a certain level of service. Sometimes a minimum number of offices or public letterboxes are required in relation to the population or within a delimited geographical area. The Postal Directive entered into force in 1998 and was subsequently revised in 2002 (2002/39/EC). The Swedish Postal Services Act and the Postal Services Ordinance were amended in several places as a consequence of this Directive. The Directive stipulates the minimum requirements that should apply to the universal postal service in the Union, but individual Member States are also given the opportunity to place more stringent requirements on their own postal systems. National Post and Telecom Agency 4

5 This is specified in more detail in Chapter 2, Article 3.2, which states that the density of points of contact and of access points should be sufficient to meet the needs of the users. This wording is also found in the Postal Services Ordinance. Although Posten AB has largely chosen to allow independent contractors to provide the company's services and products, overall responsibility for the universal service rests with Posten AB, which is stated in the licence terms and conditions issued by PTS. In other words, Posten AB cannot avoid its responsibility for universal commitments by assigning parts of its operations to sub-contracting outlets and agents. Posten AB's licence terms and conditions require that services withdrawn from access and distribution points affecting more than one user and for which no acceptable alternative has been suggested are subject to approval by PTS. For this reason, it is crucial that PTS monitors the situation and reports on any changes that are taking place in the service network. Access and distribution points include postal outlets and business centres. The new service network The service network is the structure through which Posten AB provides the Swedish population with its products and services, that is, a form of physical interface between Posten AB and consumers. The service network used to consist of traditional post offices, which covered Sweden in a fine-mesh network. This network was subject to continual change, a process which was consequently not limited to the substantial changes implemented in 2001 and The number of post offices fell from around in the 1970s to around shortly before the new service network was implemented in 2001, a reduction of around twothirds. The majority of the post offices closed were replaced by a rural delivery service. In order to sustain a sufficiently branched service network throughout the country, Posten AB, following its restructuring in 2001, worked with a national structure based on cooperation between existing service establishments. During the first phase, Posten AB entered into central agreements with a number of store chains, through whose network of shops the company's services and products were to be offered. From this point on, customers would be able to utilise postal services in conjunction with other errands. Posten AB thus hoped to achieve gains from streamlining by saving money on premises and staff, and improved accessibility for consumers through a substantial increase in the number of service points and more generous opening hours compared to the previous post office network. In the first instance, grocery and petrol station chains that have signed central agreements are to be utilised as service points. Posten AB has achieved highly satisfactory geographical coverage through these chains. Thereafter, separate agreements are entered into with each individual shop. In some locations, it has not been possible to find a suitable partner through central agreements; in these cases, Posten AB has selected independent shops and service establishments on the basis of its knowledge of local conditions. Such special arrangements are particularly common in central Stockholm, but also in rural areas. National Post and Telecom Agency 5

6 Posten AB always carries out an assessment of the individual representative's suitability in terms of accessibility, its premises, staff and the financial prerequisites of the shop, etc. From a European perspective, the conditions in Sweden are particularly challenging as large parts of the country are very sparsely populated. Although much of the population is located in the relatively densely populated southern areas of the country, with substantial population densities in the three metropolitan areas, southern Sweden also has large rural areas that are sparsely populated. More difficult conditions prevail in Norrland, particularly inland, with its large expanses and sparse road network. Structure of the service network The structure of Posten AB's new service network consists of different levels of service: the lowest level basically only offers the sale of stamps and mail products that can be put directly into a public letterbox. The next service level largely corresponds to the old post offices, where registered letter and parcel services are offered and where the addressee collects certain items after having received a dispatch note. The third level consists of business centres, which are still managed directly by Posten AB. As indicated by their name, these are directed at business customers and their particular needs. Stamp agents Currently (2006), the first service level consists of stamp agents, of which there are more than compared with just over 800 agents in Those establishments serving as stamp agents are usually betting shops, petrol stations, newsagents and tobacconists with generous opening hours, often between 10am and 8pm, five to seven days a week. Stamp agents do not constitute access and distribution points, but only sell those parts of the product range that can be put directly into a public letterbox. As discussed above, the number of stamp agents rose sharply following the changes implemented by Posten AB in early This increase can be explained by the fact that many previously independent sellers of stamps chose to become official distributors for Posten AB and were thus integrated into the service network. Consequently, they are also liable to comply with official price lists as well as supply Posten AB's product range. Postal outlets The second service level, postal outlets, consists of service establishments where consumers would normally go, for example to buy groceries. The postal outlets' products and services are mainly tailored to residential customers and entrepreneurs. These outlets also serve as access and distribution points for registered mail and parcels, i.e. addressees are to turn to these service points when they have received a notification from Posten AB. All addressees are linked to a particular postal outlet in the vicinity through the postcode system. It is also possible to bring parcels and registered mail for dispatching, in addition to buying stamps and other mail products. National Post and Telecom Agency 6

7 The number of service points in this category has remained largely unchanged since PTS's study of 2004, and amount to approximately service points. Posten AB assesses this number as sufficient to maintain a nationwide structure of access and distribution points. Postal services are available to customers during the same opening hours as the shop. Nearly all of the outlets chose to continue to serve as a partner of Posten AB when the partner agreements were renewed at the start of the year. In total, approximately people or 6.6 per cent of the population live more than 10 kilometres from their nearest postal outlet. The number of people living more than 20 kilometres from the nearest service point that offers letter and parcel services amounts to , or 1.2 per cent of the population. It should be borne in mind that these mail recipients also have access to a rural delivery service, which is best described as a mobile post office. Postal outlets are not able to handle insured parcels for insurance reasons, among other things; customers must go to a business centre instead. The implementation of the new service network entailed less accessibility in this respect, as the number of business centres is substantially lower than the number of post offices in the old network. However, private customers tend to make very limited use of insured parcel services. These are mainly used by business customers, who are ordinarily directed to business centres anyway. Business centres Business customers are directed to special business centres, which continue to be managed directly by Posten AB. These centres mainly focus on business customers, but there is nothing to prevent private individuals from also using them. Business centres are usually located in industrial estates or the like. They provide a wider range of products and services and also have staff who can provide advice for the specific needs of these groups of customers. Business centres are open five days a week between 7am and 7pm. There are currently 381 business centres, compared with around 430 in According to Posten AB, this reduction is due to a previous surplus of business centres. In many cases, this involved post offices remaining from the old service network and which primarily had private customers. Now that Posten AB has found better partner solutions, a number of business centres became redundant and for this reason were closed down. Posten AB's experiences For Posten AB's customers, the implementation of the new service network has meant improved accessibility in many respects. When restructuring was completed in 2002, there were approximately service points compared to approximately post offices in Unfortunately, it became clear that what had been won in terms of improved accessibility had been lost in terms of clarity, or in other words: customers were unsure of where to turn for postal services. The fact that postal services and counter services had also been separated was another source of irritation for many people when it proved to be impossible to perform payment services at the National Post and Telecom Agency 7

8 partners of Posten AB or to buy stamps from Swedish Counter Service (which is wholly owned by Posten AB and through which Posten AB carries out its government assignment for the provision of national counter services). Public discontent was reflected in Posten AB's customer surveys and in PTS's annual opinion polls. In order to rectify the lack of clarity experienced by many consumers, Posten AB drew up a 'channel strategy', which involved a clarification of the function of service points and the types of services that consumers can expect to find there. The channel strategy was implemented in early Information campaigns, emphasising a more explanatory use of logos and symbols for the service functions, constituted an important component of the channel strategy. For this reason, each level of service received its own logo, and the target groups and function of the service points were clarified by means of name changes, where only the postal outlets and business centres used the traditional postal symbol on their signs. The aim of this is to illustrate that these are access and distribution points where Posten AB offers a wider product range in addition to the possibility of sending and receiving parcels and registered letters. The table below shows the trend in the number of service points where customers can send both letters and parcels since the implementation of the new service network in 2001 and These service points are most closely comparable with the old post offices. Table 1 Number of service points where customers can send both letters and parcels (postal outlets and business centres). Type of area 2001* ** *** Sparsely populated areas % Rural areas near densely populated areas % Densely populated areas % Total % * Post offices including parcel services ** Including 206 stamp agents offering distribution *** Comparison made excluding stamp agents offering distribution The rural delivery service As service points are often fewer and more far between in rural areas compared with more densely populated areas, the rural delivery service for households and businesses is an important part of the fixed service network in these areas. The rural postman can be compared to a mobile post office, providing customers with basic postal services alongside the delivery of mail. The number of rural carrier routes has not changed significantly over the past few years. Increased accessibility The new service network's initial and greatest problem was that many shop premises were poorly adapted to meet the special needs of people with impaired National Post and Telecom Agency 8

9 mobility in particular. The old post offices were exemplary in this respect. Following criticism from organisations for people with disabilities and other parties, Posten AB decided to undertake a series of measures to adapt the premises of its outlets and agents. Posten AB bore the costs of such rebuilding work. Consequently, PTS's latest report on the service network emphasised how Posten AB had solved the problem of making the premises of its outlets and agents more accessible. This work was still in progress in the autumn of 2006, but PTS assessed that the measures undertaken were satisfactory and that Posten AB would be able to adapt most of the shop premises within a reasonable time period. One of lessons that Posten AB learnt from this situation can be seen in the new partner agreements, where the requirement for accessible premises is clarified before a partner can come into consideration as a postal outlet. Posten AB's agreements with outlets and agents Most outlets and agents within the service network chose to renew their partner agreements with Posten AB in No substantial amendments were made to the content of the agreements. The term of the agreements is usually five years, but sometimes shorter agreement periods are applied. In these cases it is usually either Posten AB or its outlet or agent that does not wish to commit to a long period if uncertainty prevails concerning continued collaboration. There is otherwise a risk that one of the parties will be forced to terminate the agreement in advance, which may entail a liability to pay damages for breach of contract. In some cases, agreements are not renewed because there are difficulties in adapting premises to make them more accessible for people with disabilities. Consumer reactions Posten AB has conducted customer surveys since 1992, in which consumers are requested to grade various aspects of Posten AB. These surveys are conducted throughout the year and analysed on a quarterly basis. In the reports submitted to PTS, questions pertaining to an assessment of the new service network are classified under the topics of clarity, accessibility and postal outlets. Clarity means how easy or difficult a customer perceives it to be to find information, submit complaints and enquire about missing mail. Another key issue is whether the customer knows which type of service point he or she should turn to for certain postal services. Posten AB's comprehensive report on customer satisfaction among private individuals shows that the index improved by a few points between the first quarter of 2004 and the second quarter of When examining the individual questions with reference to accessibility, the responses vary from slight changes to no changes whatsoever during the period More positive responses can be discerned for postal outlets and business centres. The clearest improvement can be seen in the consumers' perception of how quickly they are able to obtain postal services. Consumers also perceive an improvement in clarity in terms of who to turn to in order to purchase stamps, send parcels as well as collect parcels and letters. Responses in terms of obtaining information, enquiring about missing mail and submitting complaints National Post and Telecom Agency 9

10 were less positive, even if improvements have also been experienced in these respects since In summary, the negative trend between 2001 and 2002 following the implementation of the new service network seems to have definitely been broken, with improved results in all areas. This positive development was also confirmed by PTS's own survey, which is carried out every year. In the January 2006 survey, 70% of respondents were satisfied or very satisfied with the time to reach a postal outlet. This was an improvement of three percentage points compared with the results from 2004 and More generous opening hours have also resulted in more satisfaction, with 76% of respondents satisfied compared with 73% in 2004 and Queuing times showed the greatest improvement in the opinion of consumers, with 69% stating satisfaction compared with 62% in One explanation for this may be that staff at postal outlets have become more efficient through better routines, which would also explain the 74% of respondents who were satisfied with service. Conclusions Between 2004 and 2006, the following changes were indicated by the surveys carried out by PTS concerning Posten AB's new service network: The number of stamp agents increased from approximately 800 to approximately (an increase of 250 per cent). There are currently postal outlets (an increase of 2 per cent) compared with The number of business centres has, on the other hand, declined from 436 postal centres to 381, indicating a decline of 13 per cent. The number of service points for private consumers has increased compared with 2004, although the majority of these are service points with a limited range of products and services. However, the number of business centres for business operators has declined. According to Posten AB, the decline in business centres is due to some of them having the wrong kind of customer, i.e. households. Local business operators and private individuals who used to go to a business centre which has since then been closed down have shown a certain level of dissatisfaction. However, Posten AB was required to offer individuals acceptable alternatives, usually by opening a postal outlet instead. In this situation, business customers are referred to the rural delivery service, to postal outlets or to other business centres located in the vicinity. There has been a marked increase in the number service points compared to There were approximately post offices and distribution offices prior to Posten AB implementing the new service network, compared with postal outlets and business centres in 2006, an increase of approximately 40 per cent. In conclusion and perhaps most importantly, PTS has made the assessment that the new service network solution fully satisfies the overall requirements formulated by the government in respect of giving the population access to postal services, and that in most respects this change has entailed improved accessibility. Above all, it should be borne in mind that there is no regulatory framework National Post and Telecom Agency 10

11 binding Posten AB as the body responsible for the universal service to a particular type of structure for the service network. As long as the overall objectives are respected, it is essential that Posten AB is given scope to adapt the design of the service network to a changing world. What is most crucial is that services are provided, not the form of these services. It is obvious that there were shortcomings in quality during the early stages of the changeover in 2001 due to i.a. inexperienced shop staff. Five years on, PTS rarely receives this kind of complaint. Posten AB made the mistake of underestimating the informational component of its restructuring work, i.e. getting consumers accustomed to the new solution and teaching them about its function. PTS can nevertheless see a gradual improvement in consumer opinion regarding Posten AB's new service network and that many people now appreciate the improved accessibility brought about by the outlets and agents. National Post and Telecom Agency 11