Posti sees Coronavirus accelerate the fall in mail volumes

Posti Group sales Q2

The Coronavirus pandemic has significantly decreased the demand for traditional postal services. In April, mail volumes decreased by as much as approximately 20%. Consequently, Postal Services is forced to plan special arrangements for the summer, with the objective of pausing Friday deliveries.

The impact of the Coronavirus pandemic is clear especially in the postal volumes of businesses, public authorities and communities, which together account for approximately 96% of all mail delivered by Posti.

“Due to the Coronavirus restrictions, operations in many service sector businesses have been slowed down or interrupted altogether. As a result, these organisations are not sending paper invoices or advertisements to customers in the usual volumes. In April, the decrease in the volume of addressed letters accelerated to approximately 20%, whereas in January–March the decrease was 15% year on year. This is a dramatic change, as five years ago the volume decline was only 6%. Due to the Coronavirus pandemic, also advertisement mail has decreased significantly,” explained, Yrjö Eskola, SVP, Postal Services at Posti Group.

According to Eskola, mail volumes have fallen by 50% during the past 10 years due to digitalisation, and this trend is continuing inevitably, as the role of traditional mail decreases in people’s everyday life.

“The current trend is similar in the postal industry across Europe – the Coronavirus pandemic is accelerating the adoption of digital communication tools. Furthermore, in Finland the public sector is giving up on paper mail and also the state is accelerating this process. The impact on Posti’s revenues is dramatic,” Eskola emphasised.

The current plan is to initiate temporary layoffs among operations and administration personnel within the Postal Services. In total, approximately 8,000 persons are in scope of the negotiations. Personnel in the Parcel & eCommerce business group are not in scope of these negotiations. The rescheduling of deliveries is easier during the summer when mail volumes are even in normal times significantly lower than during other seasons. Posti has adjusted the service rhythms and staff allocation based on mail volumes also during previous years.

“Posti operates without any public subsidies. These measures will allow us to maintain the profitability of our operations and thereby ensure that citizens and businesses will continue to have access to postal services also during the exceptional situation caused by the Coronavirus”, said, Eskola.

Source: Posti