SingPost raises competitiveness by upping service points

[SINGAPORE] National postal service provider Singapore Post (SingPost) is upping its game in the e-commerce logistics play after having significantly increased the number of service points.

SingPost now has more than 2,500 service points after recently incorporating nearly 1,100 Pick parcel lockers into its last-mile infrastructure. These lockers, located across Singapore, can be used by customers of e-commerce platforms including Lazada and Tik Tok to collect their orders.

Eighty per cent of Singapore’s population can reach any of the 2,500 SingPost service points within 10 minutes from their residence.

The company is now looking to further expand its delivery network with a trial launched on Sunday (Oct 19) to allow the posting and returning of mail or parcels at residential letterbox areas.

Seventy per cent of e-commerce shipments are small parcels suitable for letterbox delivery, according to SingPost.

Officiated by Deputy Prime Minister Gan Kim Yong, the SingPost@MyBlock trial –commencing with 27 blocks of public housing flats in Punggol and to be subsequently expanded to nearly 200 other blocks in four other districts – will feature dedicated slots or additional boxes at the nest of letterboxes for the posting or returning of mail or parcels.

If successful, SingPost intends to convert about 21,000 letterbox nests in its eventual islandwide rollout, adding to its network but without the need to pay a third-party for the use of the infrastructure.

Neo Su Yin, group chief operating officer of SingPost, said: “We are leveraging every touchpoint we have – from the letterbox nest in the heartland to expanding our partnerships – to serve both the postal sector and the growing e-commerce market.”

These initiatives could improve the competitiveness and cost-effectiveness of SingPost as the group increases its focus on its domestic business after divesting its Australian logistics and freight-forwarding businesses.

“I think if you look at all our competition that are in the 3PL (third-party logistics) space, convenience is one of the biggest points… I think this makes our network a lot more cost-effective and increases the productivity of what we’re currently doing,” added Neo.

She also commented that the group will thus be spared from making high capital expenditure by leveraging existing infrastructure and partnerships.

Paul Chew, Phillip Securities head of research, told The Business Times: “We view it incrementally positive to lift the utilisation of its existing infrastructure with minimal capex. We do not expect it to materially lift earnings as letter volumes are in structural decline.”

SingPost shares closed at its 52-week low of S$0.405, down S$0.01 or 2.4 per cent on Friday.