Postal fleets as a source of competitive advantage

Many postal services tend to future proof against uncertain volumes and product composition by purchasing vehicles with high volume capacities (2 to 4 m3), such as vans or van-like alternatives. Knowing that parcel volumes continue to surge while traditional letter mail continues to decline, this is often considered the “safe path” by many. Is volume really king?

And while new vehicle testing and selection often take several important criteria into account, the process often carries little to no attention to the productivity restraints inherent in the design and layout of a vehicle. The tendency to overlook productivity in vehicle specifications can be seen in most public tenders, where price, payload and cargo volume are usually given the highest importance. But volume and payload must never be mistaken for productivity. They are usually direct opposites.  

Fleets are tools

In an industry that needs to boost productivity, best-in-class operators have come to realize that a standard van, or car-like alternative, is not suitable for all types of jobs. Instead, they see their fleet as a toolbox and individual vehicles as tools of the trade. Once you really adopt this point of view, it becomes evident that you are only as good as the tools you have.  

Let’s draw a parallel to carpenters. If you are installing planks using nails, a traditional hammer would certainly get the job done. But as the number of planks to install increases, a hammer becomes less productive compared to a modern nail gun. A carpenter relying solely on hammers to get the job done will simply not remain competitive against competition. He needs to have a variety of tools in his toolbox. 

And it should be no different for posts, although this is where it often becomes somewhat difficult for many. Some tools will be ideal for transportation, whereas others are ideal for delivery – two inherently different tasks if you compare the two workflows.  

Selecting the optimal tools can realistically improve labor productivity by as much as 25%. And this is key to remaining competitive in post. Considering that labor costs often make up more than 85% of all costs relating to any given delivery route, improving labor productivity promises high rewards.  

What makes a great tool?

A great tool, no matter the situation, should always be: 

  • Designed and built around a specific workflow, aimed at solving a specific task
  • Improving your overall productivity
  • Allowing you to perform the work ergonomically, safely and reliabily
  • Improve user satisfaction
  • Helping you meet goals and standards

But selecting the right tools is only half the job. Best-in-class operators don’t settle for a simple 1:1 replacement and take it one iteration further.  

  1. Determine what type of routes and product composition (and volume variation) you have. Read more about how Norway Post found the right tool for the right job here. 
  2. Remove large format parcels and packets from routes with frequent starts / stops and many drop-off points. They usually only represent a small percentage of the total and is best serviced by different tools.  
  3. Put optimized delivery tools such as micro-logistics EVs in typical delivery-routes and optimized transport tools in routes dominated by transport.  
  4. Continuously reconfigure routes to capture the operational savings created. This is KEY.   

Norway Post, Helthjem and New Zealand Post are great examples of companies to have successfully implemented this strategy, and several more companies have followed suit with great success.