A great partner to do business with today
Sapo attracting state departments and entities for services
The acquisition of the SA Social Security Agency (Sassa) business is a step in the right direction for the plans to grow the SA Post Office’s (Sapo) share of government services business and diversify revenue streams.
“Sapo is in an ideal situation to replace expensive private sector dependency in many service delivery areas, including improving financial inclusion levels,” says Sapo CEO Mark Barnes.
It’s also opened a gateway for other government and private sector opportunities that want to do business with Sapo, says acting group executive for commercial John Nanyane.
“Sapo is arguably the greatest place to grow business with today and we will engage all the opportunities as long as they are aligned with our vision to grow the diversity of revenue streams and the economics make sense,” says Nanyane.
Nanyane says government should capitalise on the reach of Sapo’s branch network to facilitate the access to services.
“Sapo’s branch reach touches almost every corner of the country and, save for the odd exceptions where we lease, we fully own all our buildings, making our environment fertile for government expanding its service delivery range.”
He says doing so, government will be contributing towards the development of small enterprises because Sapo’s additional footprint expansion beyond its more than 1,500 branches is constituted by Retail Postal Agents, which are run by small entrepreneurs who resell Sapo’s products and in turn make a living out of this model.
Nanyane says government services such as identity documents and passports issuance should be extended to Sapo.
The disburse- ment of state funds pertaining to government payments for UIF, land claims, road accident fund and other similar payments businesses should be easily facilitated through the grants payments technology infrastructure that it has developed with state money.
“Sapo has the capacity to handle these services and we are pleased because more government departments and entities are approaching us for help, and of course, we are more than able to,” says Nanyane.
Nanyane’s sales business division is tasked with the responsibility to scout for commercial opportunities for Sapo as part of the entity’s plans to return to profitability and become self-sustaining. The division also markets Sapo’s products and services as well as managing relations with customers.
He says the reselling of Sapo’s customer value proposition after years of declining service levels is a key component to its journey of becoming the post office of the future. “One of our main accomplishments was to meet with our 40 large customers and explain how Sapo was engineering its turnaround.
“We are committed to bending over backwards to meet their needs because their business is important to us,” he says.
Nanyane says Sapo is fast diversifying its revenue mix to mark a steady departure from the reliance on traditional mail in line with global trends among postal service providers.
He says there is an opportunity for public-private sector arrangements, especially for entities that seek benefit in the market segments that Sapo services and also want large numbers.
Through the Sassa contract, the entity has signed up over 8-million new customers in the past few months, adding to the 5,6-million Postbank customer base, significantly increasing the amount of daily feet in its retail spaces.
“The opportunities are plenty for third-party collaborations,” he says, “Especially given that a large portion of these customers transact inside the branch. Postbank also boasts about 100,000 stokvels and community savings club account holders that are attracted by its competitive savings interest rates and they make their cash deposits inside the branch. There are opportunities for collaborations in areas such as technology-backed value added services.”
Sapo already provides motor vehicle licence renewals services within its outlets and handles the subsidised component of the distribution of set-top boxes that form part of the digital migration.
Nanyane also identifies Sapo’s vast properties as a further revenue avenue and a collaboration opportunity. The entity has about 300,000m² of vacant office and warehousing space across the country.
“Some of our properties are positioned strategically in major routes within central business districts offering avenues for activities such as outdoor advertising, beyond occupation,” says Nanyane.
He adds that the state and learning institutions can utilise these properties to provide experiential learning opportunities through virtual and augmented reality for school leavers and even unemployed graduates.
Interfacing technology in its product offerings is also in the offing.
A Sapo-owned data centre situated in Grabouw in the Western Cape is focusing on implementing a secure digitised paperless transaction solution which will allow signatories to agreements to sign digital copies rather than paper copies. Like Barnes, Nanyane sees a not too far future for a Sapo that operates in areas beyond mail delivery.