PostNet CEO Chris Wheeler – ‘our interpretation of the Postal Act is very different’

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Chris Wheeler, the Chief Executive of PostNet, joined the BizNews Power Hour to discuss the South African Post Office and the Independent Communications Authority of South Africa’s move to get a monopoly on the delivery of all parcels under one kilogram. Wheeler draws a distinction between postal services and courier services, stating that PostNet’s understanding and interpretation of the Postal Act is very different to that of SAPO and ICASA. – Nadya Swart

Chris Wheeler on where the law stands on the Post Office monopoly on deliveries under 1kg:

I think, first things first – before we get into the emotional side – please remember that I’m not the lawyer. But it’s quite simple; PostNet is an organisation – and thankfully, the South African Express Parcel Association are all of the same opinion – and we do not believe, when we read and understand the Postal Act, that we have the same understanding as what ICASA and SAPO do. So our understanding and interpretation of the Act is very different to what they believe the Act reads. 

Our understanding is from a business model point of view, the Postal Act, which was written many, many years ago, is related to postal services. We offer a courier service. We don’t offer a postal service. A courier service is very simple. It’s time sensitive. You’ve got track and trace. We’re all about efficiency and being fast. If you look at the Postal Service – which is a stamp, which is an envelope – it’s two totally different products. So our understanding and interpretation of the Postal Act is very different. 

On the volume of the courier service for parcel/packages under a kilogram:

It’s a substantial amount of volume across the whole industry. I think you made a statement there that the industry is worth R20bn. A fair sized amount of that business is obviously items that weigh under a kilo, and I think that’s a big point to remember – it’s not just PostNet. And if I do go into a bit of history; we started our business in 1994 – so we’ve been trading for 27 years. We’ve got 412 retail outlets – all individually owned and operated. There’s many other businesses – good businesses – that do exactly the same as PostNet.

The courier industry is a large business in South Africa. We’re talking about a R20bn industry, so it’s a fair amount of parcels – I’m sure. And it doesn’t only affect our business. It’s across a whole host of other businesses, whether it’s education, whether it’s e-commerce, whether it’s the person, the man in the street that deserves choice when sending a parcel or going on holiday and leaving a set of keys in a jacket that they want to send back home. It’s all about convenience, it’s all about courier. So yes, we don’t believe in the interpretation of the Postal Act, and that’s why, unfortunately, we’re in court to protect our livelihoods. 

On PostNet’s relationship with SAPO:

We had a very strong, good working relationship with SAPO in the early days. We’ve always engaged with them. We’ve always spoken about collaboration. The legal issues with SAPO started in 1997. So, that’s quite a few years ago. And then – what normally happens in business – things change. I fully understand that. They have always got to improve. So, about four or five years ago, this came back on the table. And I must also say this, the South African Express Parcel Association (SAEPA) is a very well run organisation. They’ve always been very proactive. They’ve even engaged with the minister over many, many years.

So yeah, unfortunately it raised its ugly head probably about three or four years ago, and obviously we defended it as we’ve always done. And then there were a couple of hearings, good communication and then out of the blue – through CCC – they made a decision and they gave us the desist order to stop trading. That forced us to go to court and get the urgent interdict, which thankfully we won. It’s still in place and, as of today, a court date hasn’t been set. There’s no communication, there’s no court date. So, we’ll wait and see. 

On courier companies beings targets for organised crime:

I’m afraid to say the industry is under the spotlight with the amount of hijackings. We’ve seen a big increase in hijackings. It’s a process that the industry is taking to the higher level. It’s a concern and, obviously, it hurts the business. The consumer gets affected. The criminals have realised that e-commerce is booming – so it’s high value items.

So we have to be very careful with the moving of items of high value. We have to be very clear with the consumer that if you’re going to send an item of high value – it must be insured, because unfortunately, we don’t get it right every time. That’s the industry. No one is perfect. So yes, the industry is being targeted with regards to hijacking and theft and crime at the moment.

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