As the era of sending letters via post fast disappears, with many turning to online methods of communication, Zimpost has suddenly found itself out of business forcing the institution to turn to real estate and renting out its properties to generate revenue.
This emerged in Parliament yesterday when the parastatal’s managing director Douglas Zimbango appeared before the Parliamentary Portfolio Committee on Media, Information and Communication Techonology chaired by Mhondoro Ngezi MP Bright Matonga.
Zimbango told the committee Zimpost started facing viability problems way back in 2004 when mail deliveries drastically dropped.
“A few offices in our buildings are occupied by ourselves and the rest are occupied by other businesses because the postal sector has suffered most because of electronic substitution,” said Zimbango.
“The decline started in 2003 when we only handled 100 million mail pieces and from 2004 we were on 51½ million, in 2005 we had 32 million and in 2010 we went down to 15 million.”
Zimbango said between 2003 and 2010 Zimpost experienced a 34% decline in mail volumes prompting his management to go back to the drawing board and decide to diversify and move to real estate.
“We started renting out our office space and selling stationery and this contributed to 37% of our revenue in 2010. Mail is no longer as dominant as it was in 2003 when it contributed 70% of our revenue base.
The average amount we get in rentals every month is $120 000,” he said.
The other crisis being experienced at Zimpost was that it was being virtually run by the minister and permanent secretary as it did not have a board.
According to Zimbango, the Zimpost board should have a minimum of two board members and a maximum of seven.
MPs felt this was not good corporate governance practice. Zimbango also told the committee nowadays only a handful of councils were sending their water bills via post office mail and this had severely affected their operations.