Business Irish

Friday 26 April 2019

Doubling of Chinese online shopping parcels drives up An Post volumes

  

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Fearghal O'Connor

A surge in packages coming from China Mail - with volumes more than doubling in 18 months -has helped drive the huge parcel growth at An Post.

The Irish postal company is now planning further automation to cope with the massive rise in parcels it is delivering to online shoppers.

A €15m plan will see An Post install a second automatic parcel sorting machine next year at its Dublin Mail Centre in west Dublin.

That will add to the one it is currently installing to help it cope with a massive increase of parcels expected next Christmas, largely driven by the ongoing surge in online shopping.

"Given the expected growth rates we will need a second machine for the following Christmas," said Gareth Bridgeman, An Post's managing director for mails and parcels.

"So the minute we are over Christmas this year, in February 2020, we will start installing that second machine, which will cater for further growth."

This has seen An Post's parcels business grow by 40pc in the past year. As much as a third of the total number of parcels delivered by An Post is believed to come from Amazon. The company also has contracts with other high profile retail brands such as Zara, Next, Brown Thomas and Eason.

But one of the most striking changes is that the company has also seen a doubling in volumes from China Mail in the last 18 months.

Figures for online shopping show that €5bn was spent last year, €2bn from Irish retailers with the remainder coming from abroad. Of the €3bn from abroad, the UK accounts for two-thirds, with the remainder mainly from China and the US.

"The volumes from China Mail have more than doubled in the past 18 months and it is made up of deliveries from websites such as Wish.com and Alibaba," said Bridgeman.

Those sites specialise in cut price small electronic and other relatively low value items.

"Those deliveries can take two or three weeks to get from China but often consumers are happy to wait that length of time for a phone cover or whatever it is because it has only cost them maybe €2 or €3."

Bridgeman said that a transformation in operations at An Post over the past two years was now helping it to capitalise hugely on the boom in online shopping.

"Two years ago we were just the old post office. We didn't deliver on Saturdays or in the evening time. We couldn't use an app to let you tell us that you were going out and that we should put your parcel behind the potted plant," he said.

"We put all of these changes through in consultation with our trade union. Our post men and women watched as letter volumes have nearly halved in 10 years. People were worried about their jobs and their futures but all of a sudden we are seeing this boom in parcels."

Sunday Indo Business

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