Brazil Post To Double In Size

Brazil’s postal service has announced ambitious growth plans this week, focusing in particular on expanding parcel and logistics services and building a large presence outside of Brazil.

Wagner Pinheiro de Olivera, president of the Post and Telegraph Company was the opening speaker at the World Mail and Express Americas conference, and came out with the bold declaration that his strategy was to take the companies economic value from 0.4% of Brazil’s GDP up to 1%, over doubling in size.

Brazil’s postal service currently handles around 9 billion mail items per annum and employs around 115,000 people. However, last year a key postal reform bill was passed through the national Congress which now allows ECT to operate abroad and also make acquisitions abroad.

Pinheiro said ECT is already planning for declining mail volumes just like other postal companies around the world have had to do, but that its growth of parcels and other areas such as financial services would counter the decline in surface mail. ECT is also undergoing growth from social development in the country and a growing middle class.

Whilst letter mail accounted for 61.3% of their revenues in 2008, it had dropped to 56.9% by 2011, and is forecast to drop to just 42.5% by 2020.

However its parcel shipment revenues are expected to increase from the present 34.8% of revenue, to around 50% of the companies’ revenue over the next nine years.

For ECT, Pinheiro said, “We will have a stronger focus on parcels and logistics, but also other services like financial services in the mid-term. Our long-term objective is to internationalise the company.”

New digital and hybrid mail services are also to be introduced very soon and will continue Brazil Post’s role in interpersonal communications even as letter volumes continue to drop.

Image Courtesy of Claudio Ruiz

Author: Richard Allen