The path ahead for Canada Post

President and CEO Deepak Chopra speaks on Parliament Hill as the consultations on the future of Canada Post get underway

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Government consultations on the Task Force Report on the future of postal service in Canada are now under way. The President and Chief Executive Officer of Canada Post, Deepak Chopra, spoke with the Standing Committee on Government Operations and Estimates members about the report as they were getting started, on September 21, 2016. In his remarks he encouraged the committee “to move forward knowing what the Task Force found: that there are many Canadians counting on all of us to get this right and secure a strong future for Canada’s postal system.”

The full text of his remarks is posted below. The full Task Force report can be found here. If you wish to attend any of the consultations, you can find the Committee schedule on their website.


Deepak Chopra, President and CEO
Canada Post Corporation
Speaking notes on Independent Task Force Discussion Paper
Standing Committee on Government Operations and Estimates
3:30 p.m., Wednesday, September 21, 2016
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Introduction

I would like to thank the members of the committee for inviting us here today.

I am joined by my colleagues, Wayne Cheeseman, Chief Financial Officer and Susan Margles, Vice-President, Government Relations and Policy.

I have a few opening remarks and then we would be happy to answer your questions.

The Task Force report

I want to thank the independent Task Force for its thoughtful report.

The members of the Task Force clearly understand the significance of this national institution.

They based their analysis and options on a solid understanding of the size, scope and complexities of the postal system and its importance to Canadians.

They have provided Canadians and this committee with a report that is comprehensive and well-researched. It is frank in its assessment and bold in its analysis.

The Task Force has also provided us with indisputable facts upon which any discussion of the future of the postal system should be based.

First, the report has left no doubt that there is an urgent need to transform the business. With every passing year there is less mail to deliver and more addresses for us to deliver to.

Second, Canadians like their postal service and want it to remain strong, but not subsidized with their tax dollars.

Third, parcels are the future of the company because that’s the service Canadians want and need. Mail will always be important but Canadians are using Canada Post more to deliver the items they buy online. We’re growing our parcel business because we’re not only delivering more and more products from Canadian and global companies to Canadians. We’re also opening global markets for Canadian businesses. The benefits go far beyond Canada Post.

Fourth, there are no easy solutions. But the good news is Canadians clearly understand that the postal system needs to change and they aren’t afraid of what’s required to do it. They know mail isn’t coming back, but they don’t want the postal system to disappear. In fact, they want to know that this important institution is secure for generations to come.

The Committee’s important work

That makes the work of this committee incredibly important – not just to the future of the postal system, but to the Canadian economy.

As Chief Executive Officer of Canada Post, I understand the tremendous responsibility that has been placed on the committee, on the Government and on all of us charged with leading this organization. We must get this right.

This is about much more than mail and parcels or a nostalgic attachment to a 250 year old institution. It’s about people’s livelihoods and their dependence on a strong and vibrant national postal system.

There are 50 thousand people who work at Canada Post – with families, mortgages and commitments that depend on the company they helped build. They want to see Canada Post evolve and grow.

On a larger scale are the countless Canadians whose livelihoods depend on a strong and reliable postal system.

Canadian small businesses still regularly use the mail to conduct their operations. Cheques, invoices, statements and special customer offers – they send and receive these envelopes every day.

Our Direct Mail business is also incredibly important to many Canadians, which is why it still generates $1.2 billion dollars in revenues. It helps small business owners reach customers in their neighbourhood. Direct Mail is used extensively and successfully by charities to raise much-needed funds. It is also widely used by all levels of government to communicate important information to citizens.

In our parcel business, the dependence on a strong postal system is becoming even stronger.

Our parcel volumes are growing because the Canadian retail industry is going through a huge disruptive change as Canadians do more and more of their shopping online.

The Canadian retail industry is a significant contributor to the Canadian economy.

According to the Retail Council of Canada, total Canadian retail sales in 2015 were roughly $516 billion dollars.

We are doing everything we can to help Canadian retailers, large and small, in our biggest cities and in our smallest communities – including the North – to evolve, prosper and grow. But they need a strong and vibrant postal system to do it.

We deliver two out of three parcels Canadians order online. We are deeply embedded in the new Canadian retail economy.

We work closely with Canadians who have risked it all to start up a small online business out of their garage. Their investors are their friends and relatives who pitch in because they believe so strongly in what they are doing.

We do more than deliver the parcels they packed themselves. We help them to innovate and grow. After all, the more successful they are, the more successful we are.

As they grow, we help them to transition beyond the start-up phase, so they can focus on hiring more people and expanding. We’ve helped some owner-operated small start-ups become multi-million dollar enterprises, with large staffs and a strong future.

As well, you can name virtually any large retailer in Canada, and chances are we are working with them to help them adapt to the changing face of retail.

Many Canadians depend on these large retail companies making a successful transition into e-commerce.

Other observations

I know first-hand that change isn’t easy. But the Task Force has reaffirmed that the path we were taking was moving us in the right direction. They have also detailed the challenges that are driving the need for change at Canada Post. Over the past decade, mail volumes have declined by 32% or 1.6 billion pieces. This is a trend that will continue. We must embrace change and keep going.

The report clearly shows that Canadians support making the changes necessary to secure the future of the postal service.

They also expect the postal service to evolve, learn, adapt and improve. Not just in the way we serve them, but in the way we implement change. At Canada Post, that is also what we expect of ourselves.

Much has been said about the changes we were making to secure the future of the postal service over the last three years. Less well known is how we were able to learn, to adapt and to improve our approach and processes as we progressed.

That’s why we’re pleased to see customer satisfaction numbers in the Task Force Report remain high at 91%. The focus on constant improvement will continue at Canada Post.

Conclusion

I would like to conclude by saying to all the committee members, our challenges are large; the solutions to them must match the enormity of the challenge.

There are some that will tell you the postal system should never change and remain in the good old days. That is not an option. There’s simply too much at stake.

I would encourage you to move forward knowing what the Task Force found: that there are many Canadians counting on all of us to get this right and secure a strong future for Canada’s postal system.

Thank you.


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