The State Postal Bureau (China Post) finished its three-year
campaign to go back to profit in 2001 following separation from the
telecom sector in 1999.
Liu Liqing, director-general of China Post, announced that the huge
organization moved back into the black last year with a profit of
60 million yuan (US$7.2 million).
China Post inherited a heavy debt of 18 billion yuan (US$2.2
billion) when it split from the telecom sector.
To
ensure it quickly became an independent organization, the
government said no more financial subsidies would be given after a
three-year loyalty period.
China Post would then have to pay off any debt and support
itself.
As
a result China Post started to reconstruct itself into a modern
post provider.
With 67,000 post outlets and a delivery network composed of
aeroplanes, trains and vans, China Post said it would soon become
the country's top logistics company.
Liu Liqing estimated China's logistics market could make an annual
revenue of 1.78 trillion yuan (US$214.4 billion).
As
the market is not yet fully tapped, Liu said China Post would enjoy
the highest growth as the strongest player in the field.
China Post raised delivery speeds three times in the year and set
up its own airmail network supported by 10 planes.
The range it delivers has widened from letters and packages to
almost everything that is legal.
And EMS (express mail service) postal workers do not sit in the
post office and wait for customers any more. Now they provide
door-to-door delivery if you make a telephone call.
Big companies like Hewlett- Packard, Dell, Haier and Southern
Airlines all use China Post's network for goods delivery.
"Nobody could compete with China Post with its far-reaching network
and experienced labour force," Liu said.
But China Post is facing growing threats from both domestic private
firms and overseas delivery providers.
Foreign delivering giants Fedex, UPS and DHL and many small
domestic companies have started their package delivery business in
major cities.
Their businesses, especially those from abroad, have restrictions
due to government protection of China Post.
But that will not last forever as the country has promised to open
the service industry, including delivery business, to overseas
players according to rules of the World Trade Organization.
To
upgrade efficiency, China Post has spent millions of yuan on a
nationwide computer network which covers 236 major cities and has
made most of China Post's business available online.
In
reconstructing itself into an independent commercial organization,
postmen and postwomen have changed their status from government
officials into company employees.
They started to take into account the feelings of customers,
provide services they needed and think from the point of view of
customers.
Liu said the bureau had set its new year revenue target at 51
billion yuan (US$6.1 billion), which is an 8.5 per cent increase
compared with the previous year.
China Post plans to make a profit of 100 million yuan (US$12
million) this year, he said.
But a lot of work still needs to be done to make China Post a real
modern post organization, industry insiders said.
"The bureau needs to further reform both the management and
operation systems to become a commercial organization according to
market rules," said Tian Xuejun, executive deputy director of the
Logistics Institute at Beijing University of Science and
Technology.
He
suggested that China Post could go public to access development
capital after it finished structural reform.
(China
Daily January 30, 2002)