Thailand Post anticipates B5bn profit in 2019

Thailand Post anticipates B5bn profit in 2019

Digital developments bode well for service

Attendees of Thailand Post's Youth Camp 2018 visit the Grand Postal Building in Bang Rak district. APICHART JINAKUL
Attendees of Thailand Post's Youth Camp 2018 visit the Grand Postal Building in Bang Rak district. APICHART JINAKUL

Thailand Post expects profit to soar to 5 billion baht in 2019, a 14% increase over this year, because of e-commerce market growth from both domestic and cross-border delivery.

Improvements in making delivery management digital will also play into the likely profit windfall.

Next year, Thailand Post plans to improve logistics to capitalise on the success of e-commerce. This is in line with the government's goal to make Thailand a logistics hub in Asean.

Consumer-to-consumer (C2C) and business-to-consumer (B2C) sales have grown significantly in tandem with the popularity of online shopping, said Thailand Post president Smorn Terdthampiboon.

The arrival of foreign e-commerce giants like Alibaba, JD.com and affiliates through local partnerships have significantly expanded the e-commerce segment, allowing many Thai retailers to easily ship their products abroad.

Thailand Post calculated total revenue in 2017 at 27.8 billion baht, of which 13% or 3.5 billion came from international service. This year international service revenue is targeted to grow to 14.2% of total revenue at 4 billion baht.

"We expect total revenue for 2018 to be 30.8 billion baht," Mrs Smorn said.

OVERSEAS SHIPPING BOOM

She said Thailand Post made 24 million express mail service (EMS) and parcel deliveries abroad in 2017, or 2 million per month, through varied services such as EMS World and EMS One Price.

To efficiently capitalise on the growth of e-commerce, Mrs Smorn said the company has been improving shipping capacity through both service management and an improved sorting system.

The move is to ensure that the organisational management structure and operating system can handle the existing challenge of accommodating messenger service apps and international courier and parcel delivery service providers.

For service management and new products, Mrs Smorn said Thailand Post recently extended office hours for major postal offices nationwide from 4.30pm to 8pm daily during Monday-Saturday as well as opening on Sunday from 8am to noon.

The added hours will help e-commerce retailers that need to use services outside of normal office hours and reduce critical limitations.

Thailand Post recently began adding further delivery services such as a messenger service to pick up parcels for customers at a desired location, plus a call centre to inform customers when their parcels arrive.

Mrs Smorn said Thailand Post launched its latest service, ePacket, in July to enhance the competitiveness of Thai online merchants abroad, with a 20% lower fee than that of the same service provided by international courier DHL.

EPacket was designed to help Thai online merchants who are charged high fee rates when sending products abroad via EMS.

Thailand Post has also connected its shopping tools with the multinational e-commerce platform eBay since June to better serve Thai online retailers on the website.

EBay is the most popular site for cross-border e-commerce among Thai retailers, with more than 10,000 Thais using the eBay website as a sales channel.

With the ePacket service, recipients do not need to sign to receive, but the delivery process can still be tracked via Thailand Post's website.

The ePacket service is targeted at online merchants who want to deliver parcels weighing no more than two kilogrammes to the most popular destinations in 16 countries, including Japan, China, Singapore, South Korea and the US.

The fee for delivery ranges from 120 baht to almost 1,000 baht, depending on the destination. Recipients will receive the parcel within 3-9 days.

Although ePacket takes 1-2 days longer than competing services, it costs an average of 400 baht for products weighing between 500 grammes and 1kg.

AUTOMATED SORTING BY 2022

Mrs Smorn said Thailand Post will launch new services to benefit online merchants who sell to overseas clients next year.

To improve its sorting system, Thailand Post plans to spend 10 billion baht to establish two fully automated sorting centres.

The fully automated system will ease the growing load of mail and parcels, as well as reduce damage and errors in the sorting process.

Mrs Smorn said one of the new sorting centres will be in Chon Buri province, while the other will be in Wang Noi district in Ayutthaya province. Each centre needs an area of 100 rai.

Thailand Post bought 120 rai of real estate worth 400 million baht to develop the Ayutthaya sorting centre.

The five-year investment plan aims for the fully automated system to begin by 2022.

Thailand Post has 19 logistics centres and 1,300 post offices, with an additional 3,300 licensed post offices nationwide.

The enterprise has budgeted 4.4 billion baht to install a mixed-mail and parcel sorting system at its 19 logistics centres by 2022.

Thailand Post installed the mixed mail sorter at its Sri Racha and Nakhon Ratchasima logistics centres, while the cross-belt sorter has been installed at the Sri Racha centre.

The sorter consists of a chain of independently operated short conveyor belts mounted transversely along the main track. The belts sort parcels, apparel and small items that are difficult to sort, such as fragile or high-friction items, at high speeds.

The ongoing installation of the mixed-mail and parcel sorting system, worth 4.4 billion baht, will improve capacity within the semi-automated system.

Thailand Post will spend 1.1 billion baht to upgrade Counter Automation Point of Sale (CA PoS) for all 1,300 post offices nationwide by the end of this year.

The new CA POS will provide more innovative applications to serve changes in markets and customer behaviour.

The system comes with digital devices for delivery staff to assist customers and keep precise records of the delivery process.


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