Acknowledgement This research has been accomplished with the contributions and encouragements from many people. I would like to express my gratitude to all supports. Without these supports I would have had a tough time. Firstly, big thanks are addressed to my thesis advisor Prof. Vijay Kapoor, FMS, Delhi University. His knowledge and helps has really been useful while making this thesis. Further, his kind encouragements and patience in providing valuable comments and recommendations on the beginning draft. Without him, this research would not have been successfully carried out. The deep appreciations are also addressed towards all the people who had read and gave the information and advice that have made this thesis possible. Finally I would like to thanks to all the people who had answered to my questionnaire. Indian Postal Service Vs Private Courier Service 1 | Page
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Acknowledgement
This research has been accomplished with the contributions and encouragements from many
people. I would like to express my gratitude to all supports. Without these supports I would
have had a tough time.
Firstly, big thanks are addressed to my thesis advisor Prof. Vijay Kapoor, FMS, Delhi
University. His knowledge and helps has really been useful while making this thesis.
Further, his kind encouragements and patience in providing valuable comments and
recommendations on the beginning draft. Without him, this research would not have been
successfully carried out.
The deep appreciations are also addressed towards all the people who had read and gave
the information and advice that have made this thesis possible.
Finally I would like to thanks to all the people who had answered to my questionnaire.
Indian Postal Service Vs Private Courier Service 1 | P a g e
Executive Summary
The British East India Company first established post office in Mumbai, Chennai and Kolkata
from 1764-1766, during Warne Hasting’s Governorship, postal service was made available
to the general public. A letter would cost 2 annas (one-eighth of a Rupee) for distances up to
100 miles. Payments would be done through copper tokens; a letter was hand stamped “post
paid” if paid for, otherwise it was stamped “post unpaid” or “bearing”.
In 1839, North West Province circle was formed and since then, new postal circles was
formed needed. In December 1860 Punjab Circle, in 1861 Burma Circle, in 1866+ Central
Province Circle and in 1869 Sind Circle were formed. By 1880 Circles had been formed in
Indian Postal Service Vs Private Courier Service 12 | P a g e
Types of Postal Service
Indian postal services are mainly concerned with collection, sorting, and distribution of
letters, parcels, packets, etc. Besides, a number of other services are also provided to the
general public as well as business enterprises under the following main headings.
Mail service
Remittance service
Banking service
Insurance service
Other services
Mail Service
Mail service is one of the main services of post office that deals with collection of letters and
parcels from the sender to distribute among the receivers. Indian Postal service deals with
both inland and international mails. While sending a written message, the sender can make
use of a post card, inland letter card or envelop. For sending an article in a packet or parcel,
a wrapper (thick paper or cloth) can be used. These are the alternative means of sending
any mail through the post office.
Post Card: Post card is the cheapest means of written communication. It is a card on both
sides of which we can write our message. It has a specified space to write the address of the
receiver. In the post office, two different types of post cards are available. One is 'ordinary
post card' and the other is 'competition post card'.
Inland: Like post card, written messages can also be sent using inland letter card. This card
is sold by post offices and is commonly used for sending messages within our country.
Unlike post card, the written portion of the inland letter card is folded and sealed. Only names
and addresses of the receiver and the sender remain open.
Envelope: It is a small size paper packet having one side open. Postal Envelopes are
available at all post offices. These are widely used for mailing letters and other documents in
all government and private offices as well as in business firms. In these envelopes there is
no need to affix any additional postage if the weight of your enclosure is upto a certain limit. If
it exceeds that limit, then additional postage will have to be affixed according to the postal
rates.
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Parcel Post: The postal facility through which articles can be sent in the form of parcels is
known as Parcel Post. It provides reliable and economical parcel delivery service. Under
parcel post services, parcels of specified size and weight can be sent across the country as
well as outside the country.
Book Post: Articles in the form of printed materials, printed books, periodicals, greeting
cards can also be mailed as book post. Under book post, envelopes containing books or
documents should only be closed but not sealed.
Specialized Mail Service
For convenience of people post office also offers various mail services having some extra
advantages like sending mails faster, ensuring certainty of delivery of mails, compensating
the sender in case of loss or damage to the mail during transit etc. We can avail of the
benefit of all these facilities by paying additional postage.
Certificate of Posting: When ordinary letters are posted, the post office does not issue any
receipt. In case if a sender wants a certificate can be obtained from the post office on
payment of prescribed fee. This is called ‘certificate of posting’. It may serve as an evidence
of posting in case of any dispute about communication.
Registered Post: To ensure that mail is definitely delivered to the addressee otherwise it
should comeback to the sender. In such situations, the post office offers registered post
facility through which we can send our letters and parcels.
Insured Post: Insured post is a type of mail service through which valuable articles may be
sent after insuring these upto a specific amount. In case of any loss or damage to the letter
or parcel, the post office shall compensate for it.
Speed Post: Here post office provides time-bound as well as guaranteed mail delivery
through its Speed Post Service. Under this service, letters, documents and parcels are
delivered faster i.e., within a fixed time frame. This facility is available at specific post offices.
Post Restante: When it is necessary to send letter to a person whose exact address is not
known you can send it to the postmaster of that area in which the receiver resides. These
letters are called Post Restante Letters. With this indication the letter will be retained at the
post office at the receiving end (maximum for 14 days) and delivered to the addressee on his
calling the postmaster concerned.
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Postage for Mail Service
In our country there is a uniform rate for all types of mails (except speed post) that move
within the country. For mail outside the country or by speed post, the postage varies on the
basis of weight as well as distance. The payment to post office for the service is made
through postal stamp.
Postal Stamp: Postal stamps of various rates are available in all Post office. The postage we
pay while buying post cards, inland letter cards and envelopes (with stamp) available in the
post office, only for the minimum permissible weight of our documents. If the weight exceeds
that limit we have to affix additional postage.
Franked postage: In large offices where hundreds of letters have to be stamped everyday,
the post office provides another facility to affix stamps through a machine known as ‘franking
machine’. This machine can print postage of different denominations, which are called
franked postage.
Payment without affixing any stamp: These are certain types of mail where the postage is
paid by the sender either well before dispatching the mail or by the receiver after receiving
the mail. The Postal Department carries braille literatures free of charge.
Computerized Slip: In some post offices now-a-days computer generated slips are pasted
on the mails. There is no need to affix any postal stamp separately. The amount of postage
paid, date and time is mentioned on the slip. This facility is available for registered letters,
speed post letters, etc. and not for ordinary letters.
Remittance Service
Money Order: Money can be sent through post office under money order service. Money
order is an order issued by one post office to another post office to pay a certain sum of
money only to the person named therein. For the convenience of customers, post office
offers different types of money order services like Ordinary Money Order, Telegraphic Money
Order, Satellite Money Order, Speedpost Money Order, etc. For the convenience of
businessmen it also offers Corporate Money Order service.
Postal Order: Like Money Order, money can also send through postal order i.e., Indian
Postal Order (IPO). It is a convenient method of sending money from one place to another
place. Postal Orders are available at all post offices in different denominations like Re.1/-,
Rs.2/-, Rs.5/-, Rs.7/-, Rs.10/-,Rs.20/-, Rs.50/-, and Rs.100/-.
Indian Postal Service Vs Private Courier Service 15 | P a g e
Banking Service
Post offices undertake some of services like accepting deposits from the public and
withdrawal of deposits. Under this service it offers various schemes to encourage the savings
and motivate people to save. Some of the important savings schemes offered by post office
are:
Post Office Savings Bank Account: It is a type of account in which we can deposit our
savings in post offices and withdraw it whenever required. The account can also be jointly
operated. Post office pays interest on our deposits, which is totally exempted from income
tax.
5-Year Post Office Recurring Deposit Scheme: A Recurring Deposit account can be
opened for any amount, which is a multiple of Rs.5/- without any maximum limit. The deposit
is to be made every month for a period of 5 years.
Post Office Time Deposit Account: Any individual can open this account with a minimum
balance of Rs.50/-, without any maximum limit. The depositor makes deposit in lump sum
and that amount matures after the expiry of a fixed period like one, two, three or five years.
Interest on this account is given on annual basis but computed quarterly. The deposit amount
as well as interest income is exempted from tax.
Post Office Monthly Income Scheme: Under this scheme a fixed sum of money is
deposited for six-years and the depositors get the interest on it every month. A minimum
amount of Rs.1, 000/- and maximum of Rs.3 lakh in individual account and Rs.6 lakh in case
of joint account can be deposited. In addition to interest the deposit amount also earns bonus
at the rate of 10% which is payable on maturity. Both interest as well as bonus is exempted
from tax.
6-Year National Savings Certificates (VIII Issue) Scheme: National Savings Certificates
(NSC) can be purchased from the post office. Interest is compounded half-yearly and
payable also half-yearly. After 6 years, these certificates can be encashed from the post
office. Interest income is treated as re-investment and is subject to tax rebate. This deposit
scheme is very popular among the income tax payers.
15 Year Public Provident Fund Account (PPF Account): Individuals can open this account
in their own name or in the name of their minor child. In this account atleast one deposit is
Indian Postal Service Vs Private Courier Service 16 | P a g e
required in every year. A minimum deposit of Rs. 500/- is required to be made each year.
The deposit amount gets rebate under income tax and the interest income is fully tax-free.
Kissan Vikas Patra Scheme: In this scheme a fixed sum of money gets doubled within a
certain period. There is no maximum limit of investment. Money can be withdrawn before its
maturity but there is a minimum period called lock-in period within which your money cannot
be withdrawn.
Insurance Services
In addition to dealing with mail and remittance of money, post offices also provide life
insurance coverage to individuals. Post offices offer life insurance under two schemes; (i)
Postal Life Insurance (PLI), and (ii) Rural Postal Life Insurance (RPLI).
Postal Life Insurance: Postal Life Insurance (PLI) was initially introduced for postal
employees. Over the years it has been extended to the employees of central and state
governments, public sector undertakings, universities, government aided institutions,
nationalized banks and financial institutions. The post office allows the employees of these
organizations, who are below 50 years of age, to insure their life on payment of a fixed
premium for a particular period. It undertakes to pay a certain sum of money either on the
death of the insured or on the expiry of a specified period.
Rural Postal Life Insurance: Just like postal Life Insurance, the Post Offices also provide
life insurance coverage to the people living in rural areas and the weaker sections of society,
which is known as Rural Postal Life Insurance (RPLI). Under RPLI, the insured person pays
a very low premium for the insurance coverage.
Others Postal services
Apart from several postal services like mail, remittance, banking and insurance services, post
office also provides various other services like-.
Sale of stamps: In addition to postal stamps, various other types of stamp like revenue
stamp, share transfer stamps, recruitment stamp etc. are also sold at post offices.
Sale of Forms: Post office facilitates sale of different forms like passport forms, UPSC
(Union Public Service Commission) forms, SSC (Staff Selection Commission) forms and
forms of other national level competitive examinations.
Indian Postal Service Vs Private Courier Service 17 | P a g e
Bill Payment: Post office also collects payment of telephone, electricity, and water bills from
the consumers.
Pension payment: For the convenience of pensioners, Government of India has made
necessary arrangement for payment of pension through post office. Military, railways,
coalmines, telecom pensioners can avail of this facility from the nearest post offices. Post
office also provides the facility of old age pension to senior citizens. Ministry of Social
Welfare and State Governments grant this old age pension.
Post shops: Post shops are the small retail shops established for sale of postal stationery
items, greeting cards and small gift items to the customers. These shops are found within the
premises of some post offices.
Philately: Special and commemorative postage stamps as well as special covers (envelopes)
are issued by the Postal Department that cover a wide range of themes reflecting the rich
natural and cultural heritage of the country. Important national and international events,
famous personalities and institutions are honoured through the medium of commemorative
postage stamps and envelopes. These stamps enjoy wide popularity in the world of philately.
Gramin Sanchar Sewak Scheme: With a dream to provide telephone facility to every home,
Gramin Sanchar Sewak Scheme has been launched. It is a joint effort of Department of Post
and Bharat Sanchar Nigam Limited (BSNL) Under this scheme, the postmen while delivering
mails from door to door will also carry a mobile phone with them. People can make use of
that phone by paying the specified charge to the postman. This facility is available only in
rural areas of our country.
Private Courier Services
There are some private operators who provide mail services to the public. They are known
as private couriers. They collect letters and parcels and deliver them at the place of the
addressee. Private couriers provide quick service in collection and delivery of letters, parcels,
packets etc. No postage is required to be affixed on letters and parcels if sent through
couriers. The charges payable for private courier service are generally higher in comparison
to post office. Again these charges are also not uniform. Private couriers are popular in big
cities and towns. OVERNITE EXPRESS, FIRST FLIGHT, DTDC, DHL, BLUE DART
EXPRESS are some of the private carriers operating in our country. The main features of
private courier services are as follows:
It provides a quick means of communication.
It provides facilities for national as well as international communication.
Indian Postal Service Vs Private Courier Service 18 | P a g e
All kinds of articles are handled by it except gold and jewellery.
Besides using railways, roadways and airways for carriage of articles, some agencies
use telephone, telex and fax services for transmission of messages.
It undertakes full responsibility of safe and timely delivery of articles.
It collects articles from the doorstep of senders and delivers them to the receivers.
Industry Involvement
In Postal/Courier service Industry no. of other Industries are involved. An airline provides air
transport services. Airlines lease or own their aircraft with which to supply these services and
may form partnerships or alliances with other airlines for mutual benefit. Generally, airline
companies are recognized with an air opening certificate or license issued by a governmental
aviation body.
Airlines vary from those with a single aircraft carrying mail or cargo through full-service
international airlines operating hundreds of aircraft. Airline services can be categorized as
being intercontinental, intra-continental, domestic, regional, or international, and may be
operated as scheduled services or charters.
Further, there are various road transports and Rail transports are providing services for
carrying mail or cargo from one state to other. Also for local services, mail bags and small
cargos are carried through road ways like motor vehicles, auto rickshaws and cycles etc. for
delivering/collecting to/from the target destinations.
Mail Transmission
Post office collects letters and parcels either through its counters or by installing letterboxes.
People drop letters in these boxes at any time according to their convenience and post office
collects these once or twice everyday during office hours. This facilitates quick sorting and
delivery of letters. The different box collects different type of mail as given below:
Red boxes are meant for collection of mails, which are not local.
Green boxes are meant for collection of local mail.
Blue boxes are meant for collection of mails addressed to metro cities.
Yellow boxes are meant for collection of mails addressed to all capital cities.
For short distance, mailbags are carried through roadways with the help of motor vehicles,
auto rickshaws and cycles etc. But for long distance mails, the most convenient mode is
railways. In our country Railway Mail Service (RMS) facilitates sending and receiving mail by
Indian Postal Service Vs Private Courier Service 19 | P a g e
railway. You might have seen the offices of the RMS inside the premises of almost all big
railway stations all over the country.
The mails that move through railways, motor vehicle, cycles etc., are called Surface mail.
Besides sending mails through roadways and railways, Indian Postal Department has also
made necessary arrangement to send mails through airways wherever air linkage is
available. All international mails are forwarded through airways. So the mail carried on by air
transport is known as Airmail.
Present Scenario
Currently, India Post does not provide services such as ‘pick-up’ services, ‘account holder’
services, ‘hold-in-your-office’ services, and payment at receiver’s end services. Private
courier companies have already started bringing in these concepts which enhance the
efficiency of the courier sector. Several courier companies offer special international delivery
services where a courier travels with the consignment and personally delivers it. Emergency
medicines and medical products, which require very rapid delivery, demand such services.
Currently India Post is incurring losses in both letter-post as well as value-added services.
Outright, we cannot privatize India Post as close to 5.5 lakh people are employed with India
Post. There are several innovative ways to revive public service provider companies and
many success stories. Those alternatives must be considered and debated before taking a
decision. As service sector growth is higher than growth in the manufacturing sector, it is
possible to turn around a service providing company in the medium run. For this to happen,
technology infusion, aggressive marketing, professional management, possible cooperation
in some services with other companies, outsourcing some noncritical services, etc. are
required.
India Post generates sufficient revenue through mobilization of household savings and
savings may be utilized partially in the capital market for further gains which can be used
directly for the betterment of India Post.
Future Growth and Competition
The new national postal policy is seeking to strengthen India Post’s role in driving socio-
economic development in India, providing a range of affordable services for the whole
population and to support business, particularly for SMEs. It lays out ambitions to expand
and modernize the India Post network, extending services into more rural areas, using the
network to provide more retail services and promote financial inclusion and socio-economic
equality in the subcontinent.
Indian Postal Service Vs Private Courier Service 20 | P a g e
The policy states that India Post will need technology partners to help it modernize its own
communications networks. The policy proposal also asks the question whether corporate
social responsibility should be included as part of the universal service obligation and notes
the importance of using technology like better IT to reduce the usage of paper and improve
environmental impacts at India Post.
The postal policy proposal does raise the question whether multiple operators should run the
universal service, but generally appears to favour more protection for the
universal service including more clearly-delineated definitions.
The policy considers the need for a separate industry regulator, and regarding the
competitive side of the industry proposes more work to create a level playing field and
increase service standards for registered operators. More than 2,000 small-to-large players
operate in the EUR 1bn Indian courier, express and parcel market, which has been
experiencing annual growth rates as high as 20%. More Growth is expected as e-commerce
gains popularity in India.
Future Growth could see courier, express and parcels operators sharing networks. Particular
potential for increased cooperation exists between India Post and multi-national operators in
the area of cross-border mail, parcels and logistics, the policy states, particularly with India
Post providing last mile delivery to all areas including rural and remote regions.
The policy discusses the need to develop the national IT infrastructure to foster more e-
commerce growth, and develop secure online payment systems, and for cross-border
shipping the need for an electronic interface between India Post, other market operators, the
airlines and customs of facials.
Survey
The survey process was initiated at the pre identified sample time. After distribution of 350
questionnaires I was received filled questionnaire only 311, out of which 11 were rejected Indian Postal Service Vs Private Courier Service 21 | P a g e
due to non clarity/unfairness. Finally total sample of 300 was put under analysis for deducting
conclusion.
Empirical Result & its Analysis
This provides the facts of the result deriving from the responses of the questionnaires.
1. Which Postal/Courier Service organization mostly do you prefer?
On the Preference of Indian postal / Pvt. Courier service issue 137 respondents were in favor
of Indian Postal and 163 against. It can say that there was a positive bias towards the
preference of Pvt. Courier Services which is 54.33%.
Fig: 1S: Respondent’s Choice Postal/Courier Service
1(a). Which Pvt. Courier Service Co. do you mostly prefer?
Fig:2S: Respondent’s Choice of Pvt. Courier Service
Out of 160 respondents who opted for Pvt. Courier service majority of them prefer Blue Dart
Courier Service (27%), followed by DTDC (15.67%), First Flight (8.67%) & Overnite (37%).
2. What do you look first when you use Postal/Courier Service?
Indian Postal Service Vs Private Courier Service 22 | P a g e
Fig: 3S: Respondent Look First
Majority of the respondent look first time (61.67%) and then safety (51.67%), when they use
either Indian Postal or Pvt. Courier Service.
3 & 4. The Indian Postal Service/Pvt. Courier Services is
More Secure and reliable: More secure and reliability of Indian Postal Services was in the
higher side compare to the Pvt. Courier services. Therefore, Indian Postal service is more
secure and reliable.
Provide Prompt service : For prompt service Pvt. Courier service was in the higher side,
wherein 19.67% respondent were strongly agree and 0% strongly agree for Indian Postal
Service.
Less costly: On the cost issue Indian postal service was in the lower side i.e. compare to
Pvt. Courier service, cost of Indian postal services are low.
Wide range of service products: On the issue of service product range, no clear trend
emerged as 64% (Moderately agree + Agree + strongly Agree) respondents were in favor of
Indian postal Services and 63.34% (Moderately agree + Agree + Strongly Agree) against.
However, it can say that there was a slightly positive bias towards the India Postal Services.
Customer feedback: There is enough data to conclude that Customer feedback of
Pvt. Courier Services is excellent.
Indian Postal Service Vs Private Courier Service 23 | P a g e
Fig:4S:The Reason For Using Indian Postal Service
Fig:5S:The Reason For Using Indian Pvt. Courier Service
Wide Urban network coverage: In case of Urban network coverage, again no clear trend
emerged as 73.33% (Agree + strongly Agree) respondents were in favor of Indian postal
Indian Postal Service Vs Private Courier Service 24 | P a g e
Services and 66.67% (Agree + Strongly Agree) against. However, it can say that there was a
positive bias towards the Indian Postal Services.
Wide Rural network coverage: There is clear evidence that a rural network Coverage of
Pvt. Courier service is very poor compare to Indian Postal services.
Customer friendly/ convenience: In case of Customer convenience, majority of respondent
strongly supported the Pvt. Courier service organization.
5. Age (Years)
59.67% respondents were below 35 years, 17.33% were between 40 to 45 years, 17% were
between 35 to 40 years and 65 were above 45 years.
Fig:6S: Respondent’s Age
6. Educational Qualification?
i) 39.33% were Post Graduate
ii) 35.33% were Graduate
iii) 25.33% were Professional
Fig:7S:Respondent’s Qualification
7. Occupation
Indian Postal Service Vs Private Courier Service 25 | P a g e
Majority of the respondent were working in Pvt. Organization (61.67%), whereas 34%
respondents were in Govt. sector.
Fig:8S: Respondent’s Occupation
Limitations
Sample size was limited.
Beside Primary data, the study is also based on secondary data published in books &
journals of the researchers. Sometimes data which is published by the researchers
cannot analyze fresh situation means old data and wrong data is collected by inherent
error.
Since the sample was taken from limited population, hence the finding cannot be
generalized.
Conclusion
Indian Postal Service Vs Private Courier Service 26 | P a g e
The Postal and Courier Sector have a prime opportunity to become a trusted partner in the
region. There is considerable good will for the sector. Postal organizations have captured the
interest of the Government because of efforts to reform operations and widen its scope.
Performance of this service is strongly dependent on other industries like Airlines, Railways
etc. Accordingly cost is also dependent on other industries.
From the above analysis it can be concluded that Indian Postal service is more secure and
reliable. On the contrary, Pvt. Companies are more customer convenience, provide prompt
service & feed back to their customers. Though Indian Postal Services are less costly, more
secure and reliable but still they are lagging behind to provide prompt service, proper
customer feed back and customer convenience. Customer wants timeliness first, then safety.
Therefore, to sustain in the competitive market for a long period, Indian Postal service must
improve their Customer convenience, prompt service and customer feed back. They need to
open more outlets in market place. Also, India Post should started services such as ‘pick-up’
services, ‘account holder’ services, ‘hold-in-your-office’ services, and payment at receiver’s
end services to compete with private competitors.
Bibliography
Indian Postal Service Vs Private Courier Service 27 | P a g e
Express Industry Council of India (2007), Indian Post Office (Amendment) Bill 2006.
http://www.eiciindia.org/FrontSite/Index.aspx
Association of International Courier and Express Services (2001), The impact of
competition in the postal sector, June.
13 Jan 2010 – Indian Logistics Industry 2009: Project Report on Indian logistic
industry: Rajnish Kumar, Student of PGDM, Swami vevekanad School of
1) Which postal/courier service organization mostly do you prefer?
Indian Postal service Pvt. Courier service If your answer is “Private courier service” then answer question 1(a), else go to (2)
1(a) Which Pvt. Courier service Co. do you mostly prefer?
DTDC Overnite First Flight Blue Dart 2) What do you look first when you use postal/courier service?
Price Safety Timeliness Features Advertisement Brand
Each of the items listed below has been identified as studied determinants of service quality. How important do you personally consider each of the followingin your decision making?