Five-day mail delivery? Business survey finds little resistance

95% of small buisnesses have claimed to be satisfied with the overall quality of Malta’s postal services

An absolute majority of small businesses – 95% - have claimed to be satisfied with the overall quality of Malta’s postal services, of which 76% were either extremely or very satisfied with the service provided.

A Malta Communications Authority (MCA) survey among 390 small enterprises however found that 28% of respondents were not aware of their expenditure on postal services, whilst 10% claimed to have spent more than €500 during 2018.

However, there was a decrease in participants (51%) who found next-day delivery acceptable over 2017 (58%), but a 15-point increase (from 31% in 2017 to 46% in 2019) in the number of respondents who claimed that they would accept a two-day delivery.

Respondents were also asked if they would find a 5-day delivery week acceptable. 10% of the respondents claimed that a 5-day delivery would be a major inconvenience. For the remaining 90% of the respondents, a 5-day delivery was either acceptable (47%), inconvenient but workable (33%) or just a minor inconvenience (9%).

The majority claimed that over 2018, the volume of letters received remained the same (68%) and had sent the same volume (47%).

55% of respondents also said they had increased the number of letters sent because of marketing campaigns, whilst 30% said sending more printed bills had contributed for such an increase. The majority of microenterprises (72%) claimed that the use of email was the main reason for sending fewer letters, followed by the use of voice communications (fixed and/or mobile telephony – 62%), messaging services (28%), online payments (22%) and use of social media (16%).

The changing demand behaviour in the letter post segment has had a negative impact on the financial situation of postal operators, a report for the European Parliament published ealier this month finds.

The unweighted EBIT margin (the ratio of Earnings Before Interest and Taxes, over total revenues) in the EU has declined by an average 7% between 2013 and 2017.

Malta’s postal operator saw profitability increase from 9.2% in 2013 to 12.5% in 2015, and then decline to 6.1% in 2018 – an average decline of 3.1% over five years.

“Declining volumes in letter post urge some postal operators to pursue… diversification strategies in order to sustain the economic viability of their dense postal networks… The most popular diversification strategies of USPs are express services, retail services, printing and mail preparation, hybrid mail, freight and logistics services, and financial services.”

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