In the last 20 years, "Azerpost" LLC, the only national postal operator, has made a great development. During these years, the institution began to provide a wide range of services.
A multi-sectoral approach allows individuals, enterprises and organizations in Azerbaijan to effectively manage their communication needs, and at the same time benefit from logistics and financial services provided by "Azerpost" LLC. Currently, citizens are served by more than 1000 post offices and more than 4500 employees in the territory of the republic.
Azerbaijan Post achieved its first successes in the last 20 years
Since October 7, 2004, "Azerpost" LLC has been operating as a national operator under the Ministry of Communications and Information Technologies of the Republic of Azerbaijan under the name of "Azerpost" State Enterprise (SE), and since August 31, 2009, its organizational and legal form has changed and it continued its activities as a Limited Liability Company.
Azerbaijan Post has achieved its greatest successes in the last 20 years. So, for the first time, at the 23rd Congress of the Universal Postal Union (UPU) held in Bucharest in 2004, our country was elected a member of the Administrative Council, which is the supreme body of this organization, and both supreme bodies of the organization - the Administrative Council and the Postal Exploitation Council in 2008, and again as a member of the Postal Exploitation Council at the 26th Congress held in Istanbul in 2016.
"Azerpost" LLC has been benefiting from the capabilities of these systems by implementing the Global monitoring system since 2013, and the new tracking system "IPS.Post" since 2016. These systems, in turn, serve to ensure transparency in the organization of postal work on an international platform.
Over time, the post office began to provide not only its own services, but also the services of its subordinate ministry to the population in a centralized manner. Thus, on February 10, 2017, the first "Network" service center was put into use under "Azerpost". Other institutions under the Ministry of Digital Development and Transport (former RITN) started to provide services through these centers, unlike regular post offices. Currently, 10 "Network" service centers are operating across the republic. 6 of them are located in Baku, and the other 4 are located in the cities of Jalilabad, Zagatala, Sumgait and Agdash, respectively.
Over the past period, Azerbaijan Post has expanded its activities not only within the country, but also internationally. Thus, the regional transit mail center (HUB) project for the implementation of cross-country electronic commerce was launched in July 2016.
During 2003-2023, the material and technical base of the country was strengthened, post offices and branches were overhauled or their buildings were rebuilt. If we look at the statistics, we will see that 887 new post office buildings were built, 126 post office buildings were overhauled, and new buildings were built for 11 post offices. Additionally, 367 new cars were purchased and put into use.
At the same time, 73 new ATMs were installed during 2003-2023, and 1,236 post offices were connected to the central network.
The path of development that began in the recent past continues today: the new strategy of "Azerpost" LLC, which is approved in 2021, envisages the modernization of infrastructure and the development of new business directions. A transformation office has also been established to ensure effective execution of the latest strategy.
In addition, since 2021, optimization processes have been started, structural reforms have been implemented, and new services have been launched based on international experience.
"Azerpost" also provides financial services
Over the past period, "Azerpost" has expanded its activities not only as a postal operator, but also as an institution providing financial services.
On April 16, 2010, "Azerpocht" LLC was granted a special consent (license) for the implementation of financial services. On the basis of this license, the population in the regions of the republic has the opportunity to freely access financial services, the range of services has been increased due to the provision of new services, and the integration with local and international postal and financial institutions has been strengthened.
At present, 1116 licensed post offices are capable of providing financial services. Thus, as a result of providing financial services at post offices, implementation of some work such as opening and maintenance of postal accounts, money transfers, opening of correspondent accounts in financial institutions, including the Central Bank, issuance of means of payment and debit cards, purchase and sale of foreign currency, collection of cash and other valuables is executed.
In addition, "Azerpost" has joined the IFS/STEFI international money transfer system since 2005, the "MasterCard" payment system since 2011, and within the country XOHKS, AZIPS, HOP and other payment systems, using the capabilities of these systems.
Transition to the renewal stage and implementation of a new strategy in the national postal sector
In today's ecosystem, as a result of global trends, postal operators are forced to transform their traditional business model and shift to new business directions. Research shows that today's demand for letter delivery is decreasing sharply, however, the importance of postal operators is increasing due to the growth of e-commerce and global trade, and the digital transformation and automation of operations are accelerating. Against the background of the above mentioned, the product and service portfolios of postal operators are naturally expanded.
A sharp decrease in the demand for classic postal services, especially for sending letters and telegrams, as well as online utility payments as a result of digitalization, have a sharp impact on the income and profits of "Azerpost" LLC, which necessitated the implementation of a new strategy.
Thus, with the new strategy of "Azerpost" which is approved in 2021, the modernization of the infrastructure, the development of new business directions and the implementation of the transformation of the institution in 3 directions were envisaged:
The first of those directions is to fix the basics. It combines post office network optimization, digitalization of processes, modernization of IT and physical infrastructure, corporate culture, governance and commercialization.
The second direction, which is the expansion of the main business, includes the expansion of the CEP (courier, express, parcel) business, the expansion of the financial services portfolio, and the provision of logistics services.
The last and very important direction of innovation is aimed at the implementation of innovative solutions, digitalization of customer channels, development of new products and revenue streams.
As a logical continuation of all this, transformation processes were launched in the institution in 2022 for the successful implementation of the strategy.
In the first direction, optimization processes have been started since 2021, with the implementation of the regionalization project, a total of 35 Postal Branches have been established, of which 20 are Regional Branches.
Also, the construction of a new Mail Handling Center (sorting center) and the renewal of the entire IT structure have been launched in order to ensure automated work in mail transportation, to minimize the use of manual labor and, as a result, to ensure the speed of mail delivery.
Within the framework of the new strategy, a number of steps have been taken in the direction of corporate culture, management and commercialization.
In 2022, the institution of the Board of Directors was established in the organization. At the same time, in order to increase the monthly income of employees, "Transaction bonus" and product reward system was formed. Also, for the proper management of commercialization, "Azermarka" LLC was reorganized by joining "Azerpost" LLC.
Within the second direction, three separate development lines are planned and certain projects have been implemented in each line.
Thus, with the "Postcargo" project, launched in 2023, "Azerpost" aims to become a leading player in electronic commerce (E-com) shipments from abroad.
42 PUDOs, i.e. special service points, have been commissioned in the country to implement the second line of in-country E-com delivery and improve service quality. An additional 20 Pochmatas (self-service stations with automated mailboxes) have been purchased to provide 24/7 customer service. As a result of the work done, 1.4 million parcels were delivered within the country within 12 months of 2023. This is 271% more than the target set at the beginning of the year.
For the development of the courier service, which is the third line, the purchase of software for the development of the courier business is currently being carried out, and a new marketing strategy has already been formed in order to increase the turnover.
As part of innovation, which is the last direction of "Azerpost", which is moving to the renewal stage, the status of a full-fledged member of the "VISA" payment system was obtained and card issuance, as well as card acceptance, were actively started. At the same time, a license was obtained for the establishment of a card personalization center, acquisition services and the acceptance of electronic payments.
It should be noted that as a result of "Azerpost" being a full member of the "VISA" payment system, the possibility of cashless payments in at least 500 "Azerpost" branches and thus financial transparency during the execution of the service has been ensured.
Within the framework of the new strategy, the expansion of the financial services portfolio has also been set as a goal, and the investment portfolio has been formed starting from March 2021.
In addition, the "Agent banking" project was started in a test format and the project was successfully completed. With the "Agent Banking" project, access to financial services will be provided to the population in the regions, and as a result, support to small and medium enterprises will be provided. At the same time, "Azerpost" joined the "Granat" money transfer system belonging to the Russian Federation in order to increase the choice of customers in the post offices in the financial field.
Based on international experience, "Azerpost" has benefited from its extensive postal network for different cooperations and ensured the increase of the income of the institution (including its employees). Thus, different businesses operating in the country under the "Retail" service ("Azlotereya" OJSC, "Azercell Telekom" LLC, etc.) have been given the opportunity to sell their products through post offices.
Transition from loss to profit and stable financial position
"Azerpost" has ended the operating year with a loss several times. However, after the implementation of the last strategy, the institution began to operate profitably and achieved financial stability. In the last 3 years alone, the institution's assets have increased almost 5 times and reached 774 million manats, and due to the growth of the customer base, the amount of customer balances has increased 10 times compared to 2020. Despite a net loss of 7.7 million manats in 2020, a net income of 4.6 million manats was achieved in 2023.
"Azerpost" has recently been active in the field of work with financial institutions. As a result, correspondent accounts were opened at "Aktif Bank" in Turkiye and at BCP bank in Switzerland.
A new direction of action given by victory
It is gratifying that the activity of "Azerpost" is not limited only to existing and new services, thanks to our historic victory, a special field of activity has also been formed.
Since 2020, work has been continuously carried out in order to organize postal work in the territories freed from occupation. So, in 2020, a post office was established in Hadrut, and later in Cojug Marjanli. In 2022, postal services were provided in Agalı village of Zangilan region. At the moment, works are being continued in the direction of establishing the Khankendi Post Branch, defining administrative buildings for the organization of postal services in the cities of Shusha, Lachin, Khojavend and Askaran.
Customer satisfaction – as the main goal
"Azerpost" envisages the construction of a new Mail Transportation Center and the implementation of IT infrastructure renewal projects in the next year. In addition, the full implementation of the "Agent banking" project, which has already successfully completed the test phase, is also planned.
Thanks to the work done, increasing the customer satisfaction index has been set before all postal employees as the main goal for 2024.
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