FEATURE: Chunghwa Post not just mail: chairman

TRUSTY CONNECTION::Like postal services worldwide, Chunghwa Post loses money on mail delivery. However, its other products and services are proving valuable

By Lee Hsin-Yin  /  CNA, with staff writer

Wed, Jun 24, 2015 - Page 5

“When I put on the green uniform, I can feel the trust that people have in me,” said Du Wan-yi (杜萬益), 63, a postman who works in New Taipei City.

A 46-year veteran of the post office, Du said he has seen a lot of changes in recent years, particularly a decline in appreciation for hand-written letters and a greater diversification in the services that post offices provide.

However, “the care is still there,” he said.

Throughout his career, Du has spent time with the senior citizens on his routes who live alone.

“However, times have changed, and we have to change, too,” he said.

The 137-year-old Chunghwa Post has undergone significant changes since it was established in China. Renamed in 1912 after the founding of the Republic of China, it began offering banking and insurance services in the 1930s.

In recent years it has begun selling micro-insurance to blue-collar workers, offering free fruit delivery for farmers and much more, adding services that have helped the company turn a profit at a time when the postal services of other nations are hemorrhaging money.

Many of the changes were brought about by Chunghwa Post chairman Philip Ong (翁文祺), who sees the experience he gained working abroad as an advantage in developing new business models.

The time he spent working in cities such as New York and Geneva made him more adaptable and open to innovation, Ong said.

Change was needed in the face of the biggest challenge facing postal services worldwide — a drastic decline in the popularity of mail. The volume of mail the post office collects has decreased by between 2 and 3 percent annually in recent years because more people have turned to e-mail, messaging apps or free Internet calling services, he said.

Chunghwa Post’s overall mail business has sustained an annual loss of NT$3 billion (US$96.77 million), which made it necessary to reallocate the company’s 9,000 postal employees and redesign postal routes, Ong said.

Only the small-parcel business is doing well, thanks to the growing popularity of e-commerce, Ong said, adding that Chunghwa Post plans to allocate more resources to that sector.

However, compared with other struggling postal services around the world, including the US Postal Service, Chunghwa Post is “doing relatively OK,” Ong said.

The US Postal Service has been losing a huge amount of money despite cost-cutting moves such as staff layoffs and the closures of thousands of post offices. It recorded a net loss of nearly US$1.5 billion in the first quarter of this year, according to a financial statement.

Chunghwa Post is making up for its core business being in the red by investing its Postal Capital fund more aggressively overseas. The fund is worth about NT$6.4 trillion.

That strategy contributed to Chunghwa Post’s overall profit of NT$12.1 billion last year, a number that Ong said allows the company to continue providing mail services at a loss.

Being able to make money from the investment fund has also allowed Chunghwa Post to utilize its postal network to undertake greater social responsibilities nationwide.

Ong last year launched micro-insurance operations catering to low-income, blue-collar workers such as fishermen and farmers who want accident insurance.

Chunghwa Post also works with farmers to provide free delivery for their produce as long as the shipments are within Taiwan proper. For example, lychee farmers in Kaohsiung County use the company’s free delivery service to ship 3kg standard-sized parcels of their fruit to anywhere in Taiwan proper.

In the past, partly due to high shipping costs, farmers sold only to traders or intermediaries, reducing their profits. The new service allows them to sell directly to consumers.

The synergy between the postal service and independent farmers is beneficial to both sides, Ong said, adding that it is a “good story” that promotes a positive image of the post office.

This willingness to adapt has also included keeping up with the latest technological developments. Since becoming chairman in November 2013, Ong has encouraged the use of the social messaging app Line in an effort to reduce paperwork and enhance communication within the company.

He also unveiled free Line stickers featuring mail carrier cartoons in April last year.

He has given the postal service a bit of a makeover by replacing old signboards at all 1,324 post offices, giving staff new uniforms and redesigning the waiting areas in some post offices.

The public has been appreciative of the efforts.

“It’s really nice of them to put some new chairs right in front of the counters,” Huang Yi-cheng, 62, said. “I used to have to stand there for a long time and watch them do their thing. Now we can talk naturally.”

Ong is planning to build up long-term care services for the elderly, expanding on what some mail carriers have been doing on their own over the years.

Postal workers voluntarily make more than 50,000 visits annually to about 9,100 senior citizens on their routes during working hours, according to Chunghwa Post.

Ong said that he is planning to institutionalize that service to create a stronger bond between the public and the postal service. Such connections are an intangible asset for the company, he said.

Ong said he wants Chunghwa Post to become an even more integral part of society to live up to is motto: “Whether rain, sleet, or snow, Chunghwa Post knows the drill.”