Singapore’s postal service SingPost has seen revenue from ecommerce grow by 60 per cent over the course of the last financial year.
The focus on ecommerce has contributed to a 25 per cent overall increase in revenue, bringing that figure to over £580 million. SingPost has gone from being a purely domestic postal service to a major logistics provider for the entire Asia-Pacific region.
The increase in revenue was boosted by SingPost’s acquisition of two US logistics companies, Trade Global and Jagged Peak.
Chinese ecommerce giant Alibaba is to invest nearly £140 million into SingPost, raising its equity share to 14.51 per cent. Alibaba is also entering into a joint venture agreement with SingPost subsidiary Quantium Solutions International, to help provide ecommerce logistics in ten countries across the region. However, the Alibaba deal is much delayed. It was supposed to be finalised by the end of 2015, but in November of that year it was pushed back to May 2016. The deadline has now been extended to the end of October 2016 as SingPost and Alibaba try to finalise the terms of the deal.
SingPost’s Chief Financial Officer Mervyn Lim said that the company was a pioneer in ecommerce in the Asia-Pacific region, and that the Trade Global and Jagged Peak acquisitions had helped it successfully pivot into the US market. SingPost currently has 20 warehousing facilities across the region, and is building a £100 million integrated ecommerce logistics superhub in Singapore itself.
The shift in focus to ecommerce is credited to former Group CEO Dr Wolfgang Baier, who resigned abruptly from the company in December 2015 in order to pursue “new endeavours”. Earlier in May, SingPost made headlines when its revenues crossed the $1 billion (around £700 million) mark for the first time.