Friday, May 06, 2016


Growing commerce in small towns is expanding the business of Speed Post - the express mail service from India Post. Despite dividend payments and annual reports moving to electronic transfers, Speed Post revenues have doubled in five years, partly due to e-commerce and also due to the postal department's near monopoly status in smaller centres.
For the year ended 2015-16, Speed Post's revenue touched Rs 1,645 crore, an increase of 10% over the previous year, and the number of parcels shipped crossed 43 crore, which translates into 3,400 deliveries a minute considering the working hours. The average annual revenue growth over this five-year period has been 17.7%, probably the highest among the domestic express-courier services in the country.
"Nearly 30% of business is now coming from small towns and mofussil centres," said P N Ranjit Kumar, postmaster general, Mumbai region. The department's business is concentrated among the top 15 cities. "Part of the reason is because printing and bulk mail is concentrated in some cities like Manipal," said Kumar.

To tap new segments, the department is now offering services such as cash on delivery, SMS alerts, login id to corporate customers to track bulk articles and API (application programming interface) to e-commerce companies that allows them to get raw data regarding their consignments. "In coming years, we see express delivery being super-specialized. Customers will expect consignments to be delivered within a specific time frame in a defined location. This will be possible with postmen carrying hand-held devices. We are also introducing new technology such as parcel-vending machines," said Kumar.

According to the Express Industry Council of India, the size of the country's express-courier segment is estimated at Rs 10,000 crore. The industry is expected to grow at 25% annually. The key drivers are seen to be e-commerce and the eventual passage of the Goods and Services Tax, which will bring down trade barriers within the country.

"Revenue from Speed Post has been growing at an average annual rate of about 17.7% over the last five years. The product has managed to this by competing in an open market without any government protection," said Kumar. He added that in the past two decades, there has not been a single year when revenue has dipped

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