Fortune News | Oct 03,2020
May 25 , 2019
By Haben Mehari ( Haben Mehari is an entrepreneur and a postgraduate student at Addis Abeba University. He can be reached at firstname.lastname@example.org. )
The Ethiopian Postal Service Enterprise, established on March 9, 1894, by Emperor Menelik II, is celebrating its 125th anniversary this year.
It has come a long way from the days when correspondence was conducted through messengers known as ‘melektegnas’, who travelled great distances on foot while carrying letters over their heads on cleft sticks. The Ethiopian postal service now has 1,200 postal offices and over 170,000 post office boxes all across the country.
The explosive increase of internet usage and the move of communications to digital platforms has upended the traditional core business of mail delivery. The industry has been in decline all around the world.
Nonetheless, there is lately a resurgence. The internet is finally making post offices more relevant as people are shopping online using e-commerce websites and need someone to deliver these packages to them. Rather than falling into obsolescence, mail carriers stand to prosper if they can adapt quickly to meet the demands of this rapidly growing and evolving market.
The impact of e-commerce on the postal industry has been apparent as business-to-customer and business-to-business parcelsshipping has dramatically increased in volume in recent years and it is a trend that is expected to continue. Most postal delivery companies now believe that parcels will be the most important factor for success over the next five years.
Here, postal services around the world have been given a second chance to stay relevant by becoming an essential link in the global e-commerce supply chain. They are becoming a necessary intermediary between e-commerce giants such as Amazon and Alibaba or even local online retailers and their customers across shipping and returns.
Post offices have the largest accessible network for customers in each country, and to capitalise on their advantages post offices will need to adapt and cooperate as never before. But it seems that only a handful of postal service companies are responding to the challenges. In Europe, some government postal agencies have been partially privatised to encourage them to become more efficient while others have created products and services specifically tailored to the needs of e-commerce.
With all these developments across the world, the Ethiopian Postal Service is moving in an alternative direction and is engaging in services that are outside of its core business just to stay afloat. These activities include SIM and voucher cards, wholesale and retail, financial services and advertisement services through post boxes.
African countries are lagging behind most of the world in e-commerce and out of the 151 countries assessed, Ethiopia ranks 141st in this index, according to UNCTAD's Business-to-Consumer E-commerce Index. The key areas of consideration in this index include the share of individuals using the internet, the share of individuals with accounts and secure internet servers and a postal reliability score. The irony is the South African Post office, the third best in this index, has 800 branches compared to Ethiopia’s 1200.
Just as mobile phones helped us leapfrog the need to string up landlines, e-commerce has the potential to reduce the build-out of physical retail infrastructure, lowering costs for Ethiopian customers and making us competitive in the global market for our products. This will require investment in IT and physical infrastructure, improved partnerships and coordination between post offices and shippers worldwide and standardised customs, payment and delivery processes.
In major cities such as Addis Abeba that have implemented street addresses, by collaborating with tech startups, these can be easily mapped, making parcel deliveries quick and efficient. With the rise of financial technologies, paying for our items is becoming easier and easier.
The future is e-commerce, the Ethiopian Postal Service needs to realise it and leverage its resources to make itself great again.
PUBLISHED ON May 25,2019 [ VOL 20 , NO 995]
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