President’s message
Canada Post has been guided by the same mandate for more than 40 years – serve all Canadians and pay for it with the revenues generated by fulfilling this important role. In other words, connecting the country is crucial, but someone has to pay for it.
In our case, that’s not meant to be the government, but those who use the system – to send a letter, ship online orders or deliver flyers.
This approach still resonates today because it’s designed to keep us focused on serving the changing needs of our country, as everyone is a customer. However, the problem is that as the needs of Canadians changed, the regulatory and policy restrictions placed on the postal system did not.
A transformation plan that meets the moment
Over time, as Canadians sent less mail and as parcel deliveries became more competitive with online shopping, we were severely limited in what we could do to keep pace, reduce costs and make money.
With declining revenues and rising expenses, our financial situation deteriorated to the point where taxpayers had to top up our bottom line with repayable funding just so we could maintain operations. The status quo was beyond unsustainable.
That’s why I am incredibly proud to share that the transformation to restore and renew Canada’s postal service is underway.
With the government’s announcement to lift long-standing barriers and provide the flexibility needed to reform, the path forward to re-establish this vital institution is clear. The turning point we have spent years preparing for is finally here, and we are ready to make the changes necessary to seize this historical moment.
Canadians deserve a strong, stable Canada Post that fits their needs, and we will work hard to meet their expectations.
Creating a Canada Post that Canadians want to choose
While Canadians still value Canada Post, we need to provide them with more reasons to see the value in choosing Canada Post for their delivery needs.
Our proposed transformation plan, therefore, balances the need for greater productivity and structural change with a profound understanding that Canadians and Canadian businesses need to see us providing a better service that they want to use and pay for.
Our plan is built for the modern Canada we serve. It includes long-overdue changes to align our network to how it’s used, while powering new revenue growth and innovation.
It will take time, but I’m confident it’s the right plan focused on the bold changes needed to meet the moment. It’s an investment in the future of Canada that respects our role as a public good.
A balanced plan to return to self-sustainability
We will convert the remaining door-to-door delivery addresses to community mailboxes, providing a consistent, centralized service across the country. Our Delivery Accommodation Program will ensure everyone can access their mail.
We’ll modernize and optimize our retail post office network, understanding the importance of maintaining service in rural, remote and Indigenous communities.
Mail delivery standards will also be adjusted to align with today’s expectations. Our goal is to strengthen our network by constantly focusing on core productivity. For Canadians, productivity means better reliability.
On the revenue side, we’ll grow our parcel volumes by becoming a more relevant player in the online shopping market. We’ll work with the government to eliminate the red tape in our pricing structure to provide flexibility and align letter mail pricing to international standards. We’ll also diversify and innovate to find new revenue streams that complement our existing services.
The foundation is in place
My confidence in our proposed plan is supported by work we have done in the past few years to prepare for this moment.
We’ve invested in new state-of-the-art parcel sorting and delivery capacity, including the Albert Jackson Processing Centre in Toronto. We also upgraded our information technology operations to streamline processes, provide better service to customers and fuel future growth.
Most importantly, we have the most experienced and incredible team of people in the business and an unparalleled network that touches every corner of the country.
Change is necessary, but never easy
We understand that change is never easy, especially at Canada Post. It’s largely the reason many of the restrictions we faced remained in place long after their due date. It also means that while Canadians respect the need to secure the postal service, some changes will raise concerns.
That’s why our first step was to assure Canadians we understand the responsibility that comes with the flexibility the government is providing. Last October, we shared our guiding principlesthat will frame our approach. As we move forward, we’ll prioritize service, proceed thoughtfully, treat our employees with respect, engage Canadians and keep them informed, and be flexible.
Improving our value proposition
Our goal is to first ensure we provide a trusted, reliable service that Canadians and Canadian businesses want to use.
This means providing a service that Canadians trust with their purchases, that small businesses can count on to help them compete against global giants and that strengthens connections between Canadians. Our proposed transformation plan will get us there, but change will be a constant going forward as we bring innovations to market, improve our operations and enhance our services.
Our mandate has always been our North Star and that’s important to remember as we transform.
Some things will have to change in order to protect those that are most valuable to the country. We will be leaner, but our potential to support Canadians and the economy will be much greater, as will our ability to reinvest in finding new ways to earn our customers’ business. Above all, Canadians have to see the value in using the postal service so that it can return to financial self-sustainability.
I look forward to the year ahead and encourage you to read further details on our proposed plan in this annual report.
Doug Ettinger
President and Chief Executive Officer