Despite competition, Japan Post’s unbeatable service makes it a winner

AFP-JIJI

The postal service, run by Japan Post, is a beacon of national pride compared with those in some other countries that have a reputation for slow delivery times or losing mail.

Its vast network of offices, found in even the smallest rural towns, connect the length and breadth of the country, providing a vital lifeline for communities in out-of-the-way places.

Effectively the world’s largest bank, its branches offer insurance, savings, and a place for Japan’s army of elderly to draw their pensions.

As well as exemplary daily delivery service — letters are brought to the door seven days a week and on every national holiday except one — Japan Post also competes with large courier firms like Yamato or Sagawa.

The 24,000 bureaus, which employ 209,000 people across many of the thousands of islands that make up the archipelago, give it an unparalleled distribution capability that allows online retailers like Amazon Japan to offer same-day delivery in major cities — a key edge in a land where convenience rules.

With many Japanese having migrated to big cities, an online mall offering regional specialities like fruit or fresh produce always has takers. And refrigerated delivery allows those treats from home to grace urban dinner tables just hours after an order was placed.

Like most Japanese institutions, Japan Post is built on attention to detail and making sure that customers get what they pay for — even if that means weeks of painstaking research to try to find out what that partially obscured and badly written address was supposed to be.

The government of former Prime Minister Junichiro Koizumi tried to privatize the public cash cow by splitting it into four units in 2007 to handle deliveries, savings, insurance and counter services, but the government balked and retained full ownership anyway.

The plan was for the bank and insurance units to go private in a huge stock offering over the following decade, but the sheer size and scope of Japan Post, along with the place it has in the public’s heart, put the brakes on the plan, and successive governments have run out of steam as they tried and failed to move it forward.

The slow pace of privatization has irked U.S. and EU trade officials who are worried by the group’s competitive advantage. Potential rivals abroad say the size of the organization means it has economies of scale that they would be hard-pressed to match.

While vested interests in the form of labor organizations are partly to blame for the glacial pace of reform, the public’s affection for a service that is woven into the fabric of national life is also an obstacle to change.

Who else, they wonder, would neatly sort and deliver hundreds of millions of New Year’s cards all over Japan on Jan. 1?