MAIL and courier services company Zimpost says transitioning to a diversification strategy has suffered from lack of funding and has appealed to the government to bail it out.
MTHANDAZO NYONI OWN CORRESPONDENT
Zimpost managing director Douglas Zimbango told Southern Eye Business that they were expecting to grow the business through diversification and innovation, but funding was a major drawback.
“Zimpost, like any other company in Zimbabwe, has not been spared by lack of disposable incomes and cost cutting measures by our traditional customers. We have suffered from our lack of connectivity, which limits our cashless transaction capabilities,” Zimbango said.
“The little funds in circulation have been targeted mainly at other products, not ours, which have more efficient substitutes and can be dispensed with as people concentrate on necessities. As a company in transition, our diversification strategy has suffered from lack of funding.”
Zimbango said they were currently working on a project, which if approved by relevant authorities, would be a game changer, although he declined to reveal it.
He said Zimpost was forging ahead with franchising of some post offices countrywide in line with cost cutting and empowerment measures.
The franchising phenomenon, he said, got an overwhelming response, and as such, the board and management would assess the implementation of the first phase and if successful, more post offices would be offered for franchising.
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Zimpost currently operates a network of 226 postal outlets comprising fully fledged post offices, sub-post offices, postal agents and mobile post offices.
Franchising is an arrangement where one party grants another party the right to use its trademark or trade name as well as certain business systems and processes to produce and market a good or service according to certain specifications.
In this case, the Zimpost brand would be maintained. Zimpost aims to reduce staff costs while at the same time increasing volumes because commission to franchisees is based on volumes. Zimpost will provide stock and all essentials to run an office.
Emergence of new forms of communication platforms has hurt the postal business globally, and Zimpost has not been spared.
Volumes have dropped by 86% since 2000 due to breakneck changes in technology, although revenue has been steady at $20 million annually.
In 2014, Zimbango said on average Zimpost was handling 50 000 transactions per month valued at $3 million.
It was moving about 11,6 million letters domestically and 2,3 million international mail pieces as well as about 30 000 parcels per year.
