Ahead of the World Mail & Express Europe (WMX Europe) Conference in Dublin, we caught up with Khalil Daoud, Chairman & Managing Director of LibanPost. Khalil will be speaking at WMX Europe 2019 and offers his thoughts on the conference and the future of the industry.
P&P – Tell us a little bit about yourself and your company.
KD – The Lebanese postal sector was privatized in 1998. At the time, there was not much at stake given that the post had been interrupted during the war. Illegal competition was massive, facilities were completely outdated, average employee age was 53, the operation was entirely manual, and the mail culture was totally absent in the country, let alone the financial losses and the worldwide reducing mail volumes.
I was appointed in 2002 as Chairman and Managing Director, coming with a multinational regional experience and having served in various industries. The challenge was huge and nobody trusted that the company could be revived, but here we are today… So we must have done something right, despite the fact that a lot remains to be done.
P&P – What do you hope our delegates will take away from your presentation?
KD – I will focus on the overall industry worldwide trends, as a benchmark for everyone, and will briefly discuss the new avenues that LibanPost chose to prioritize in order to accompany this change.
P&P – What do you feel are the biggest challenges facing your business today?
KD – As per previous years, we are still facing a huge challenge in terms of revenue generating opportunities and cost optimization. More specifically today, we have to cater for the growth of the e-commerce segment, as it comes with a fierce competition, technological requirements, changing customers’ buying habits, cost pressures, last mile delivery special services….
This is also an opportunity the industry has to grab, and a moment where judicious capital investments are to be made, in order to prepare for the future.
P&P – How can we advance the post and parcel industry?
KD – Mail volumes will most probably continue decreasing, while parcels will keep on growing for the years to come.
Each post will have to cater properly for the specifics of its domestic market, making use of the synergies across its mail and parcels networks, without forgetting to leverage the unique post and parcel industry platform. Collaborating across borders for a faster, cheaper, transnational, seamless delivery is also key for proper positioning, while keeping an eye on other industries’ breakthroughs as well as on technological innovations.
Finally, being a people intensive industry, any improvement in terms of service rendering will certainly advance the post.
P&P – How has the post and parcel industry changed in the past 5 years? What do you predict will happen in the next 5 to 10 years?
KD – With the digital economy, we continue to see, year after year, the decline of the mail volumes that are to be replaced by other sources of revenue. One such source is, of course, the parcels segment that is growing significantly, but other sources of diversification are to be considered. Some posts have positioned themselves on the financial end, others on the logistics end, some such as Croatia Post have ventured into on-demand TV… At LibanPost we have moved to become an intermediary counter between the public administrations and the citizens, which facilitated enormously their lives.
The post, in my opinion, is a unique setup and still has many ways to leverage its nationwide deployed presence and infrastructure, in the years to come. We can make use of our flexibility, our geographical and social proximity, and our fleet to serve in many ways.
P&P – What are the most critical changes that we must make to face the future effectively?
KD – With e-commerce amounting today to 10% of retail buys, and expected to continue growing in the years to come, we ought to be audacious and bold in envisaging new alliances, making use of technology, and being agile to serve not only a steady demand but adapt to bursts of a fluctuating demand.
We also need to be creative in order to leverage our existent retail network.
P&P – What’s the one piece of advice would you give to companies starting out in your sector?
KD – Innovation, service, cost, speed and convenience are the name of the game in our industry. Any new company would have to jump start with the most efficient digital tools and technology. I would also advise them to constantly strive to answer the changing needs of their hosting community, and to address properly the last mile delivery challenges. They could do that either on their own or by teaming up with integrators and start-ups.
P&P – How can postal organizations adapt in the face of falling mail volumes? Can they really compete with new industry disruptors and faster moving global operators?
KD – Diversification is key to face the continuous decrease in mail volumes, in order to identify new services that may compensate for the fall in revenues. A culture that emphasizes organizational and individual agility is also crucial as the posts have to rapidly adapt to new service offerings, to a variable demand, and to cost efficiency measures.
Nowadays, postal organizations have to face the new industry disruptors such as Alibaba and Amazon as well as the global integrators such as DHL, UPS and FedEx. I believe that they can compete favorably or strike alliances, by counting on their own local strengths and their integrated network.