e-box a radical break in the mail supply chain costs

A radical break in the mail supply chain cost (MERCIER) 10 October 2006

TECHNOLOGY WORKGROUPS

A radical break in the mail supply chain costs

Antoine MERCIER

CEO



E-BOX has since inception in 2000 focused on research and development of innovative postal services

In 2005, E-BOX invents “L’Agence Postale Rapide e-box™”, presented at Post expo 2005 conference in Paris

E-BOX has also conceived the CitEbox logistic system™, which optimizes routing from a suburban depot to all its related urban postal facilities

The urban depot will support a cluster of conveniently located E-BOX automated postal facilities remotely piloted through secured VPN, high-speed line and Internet connection from a central database

When parcels are put in each shared automated box by a CitEbox delivery man their recipients receive a text message and an email telling them that they have mail or parcel to be collected at their 24/7 convenience.

Background



Data

Services

Media

Services

Print &

Production

Mail & Documents

Services

Physical Mail

Distribution

CustomerResponse management

The mail stream (mail manifesto 2006)

8% 16% 14% 7% 51% 4%

Consolidation Transport

Commodity Delivery

Value added Delivery

Mail Mgt Services

Electronic Documents Mgt

Physical Documents Mgt

Facilitiesmanagement

72%

Electronic Consolidation

Print & Production

Outward fulfille-ment & dispach

Represents 65% of the total market, that is to say for EU countries

133 billions of euros



Postal Industry major stakes

The postal industry competes with other media for Direct Marketing and Account Management communication, the both of which represent 90% of the mail flow

Pressure on prices is going to increase in order to maintain this flow in developed countries and create it in others

The whole chain already has gone through impressive modernising and process automation progresses. The weakest link still is mail physical distribution

It is therefore vital for the postal industry to create a radical break in the physical mail supply chain cost by decreasing the number of intermediaries – as in the « e-commerce » revolution – and adapting mail distribution to economy realities (two mail deliveries per week at each address for instance)

Yet creating « low cost » postal processes shouldn’t be detrimental to the quality of service as felt by the customer in terms of tracking, « day certain » and confidentiality

Integrating new technologies at each step of the process will achieve such goal as explained now

Print &

Production

Mail & Documents

Services

Physical Mail

Distribution



Print &

Production

Mail & Documents

Services

1 2 3 4

1 Print &Production and sort and sequence by final delivery postman from each e-box APR address (packet of letters)

2 Transport of the packets of letters to CitEbox suburban depot

3 CitEbox logistic system™ delivers the packets in the automated postal facilities (APR)

Physical Mail Distribution

4 Final street delivery by each postman member of e-box club



The proof of the radical break in the mail supply chain cost

Now (1) Future

6,9 p Print & Production

Mail & Documents Services

Consolidation transport

CitEbox network

Value added services

Commodity delivery

Hypothesis: UK Market, >35g letters, packets of 350 letters, two deliveries per week, Urban areas

(1) Source : the mail manifesto 2006 PUG

Total (pence per letter)

7,2 p

3,5 p 3,7 p

24,0 p

2,0 p

8,0 p1,0 p

0,5 p

Physical Mail Distribution

Value added services

34,4 p 22,4 p

Cost reduction : 35% or 12 p per mail piece



Advantages

The cost , the cost , the cost….

and even more for the whole mail stream:

Intelligent mail tracking of each letter to the final customer letter box

Data Hygiene with the management real time of the wrong address

Day certain with the shortcut from the producer of the mail to the final postman (concept of a ‘street janitor’)

Response handling and data capture low cost solution through CitEbox infrastructure



Who wins?

Conclusion on the impact of the Radical break:- All the mail chain in its broadest sense wins when it is a competitive media.

- However foremost winners are intelligent mail analysis, preparation, printing, folding and routing companies upstream and their customers since the squeeze in the mail cost structure will attract them.

- Inasmuch as they can share information with local specialized mail distribution companies at the final edge of the chain. This is why E-BOX will bear such “transaction costs” in order to minimize them as shown in the ‘prices’ slide above.



What do we need ?

Coordination and information processing aiming at optimizing the packets of letters

End to End fair competition in a liberalized European market

No more reserved sector

Two deliveries a week to each address

Deployment of CitEbox infrastructure in dense urban areas before 2010



A question: It‘s a very good concept of business for dense urban areas, but what about the delivery of letters in the country side ?

The answer:“Rendezvous” next year, next time



E-BOX is honoured and proud of its two nominations for the 2006 World Mail Awards in fields particularly important for the shaping of Postal World future realities, Innovation and Technology.

E-commerce and Direct Marketing will ‘grow new Parcel & Mail revenue streams’ and opportunities: with partnering firms, E-BOX Open Technology & Innovative processes will, through the deployment of its Automated Postal Facilities network, be at the heart of this future.

&



E-BOX32, rue de Paradis

F-75010 PARIS

Tel : + 33 (0) 149 490 190

Fax : +33 (0) 147 705 945

E-mail : [email protected]

www.e-box.fr

www.e-box-club.com

CitEbox logistic systemTM is a department of E-BOX

Thank you for your attention and we have the pleasure to invite you to visit our stand 4037 at Post Expo 2006 for a full presentation of our innovative range of Postal Facilities

mailto:[email protected]

http://www.e-box.fr/

http://www.e-box-club.com/