Our action-based and results-driven strategy

Help customers grow their business
Link to key material topics Customer experienceE-commerce growthRelevance of physical mailDigitalisation and data
Focus Areas Capture e-commerce growthValue of physical mailManage network capacityDeliver smart logistic solutionsEnhance customer interactionLead through business model innovations
Outcome indicator Customer satisfactionShare of e-commerce revenueDelivery quality Parcels NL

To become your favourite deliverer, we are working to provide our customers with the best possible logistic network solutions. At Parcels, capturing market growth remains an essential part of our strategy. At the same time, we focus on marketing the value of physical mail, the power of which was clear during 2020 as people connected with friends and loved ones by sending cards, letters and gifts through the mail. And large customers also understand the power of reaching their target group using physical mail. We are investing in and managing our network capacity, helping to support the growth in e-commerce. We are improving our service quality and operational efficiencies to exceed customers' expectations. And we are using data and digitalisation to innovate our business models, bringing innovative value propositions to the market, improving our services and solutions, our logistic processes, and our dense networks. Together, these developments help our customers grow their business and flourish.

To help increase customer value we need to solve their business needs and wishes. For example, by delivering smart logistic solutions and ensuring their shipments are moved swiftly, efficiently and sustainably from supplying e-tailers with fulfilment solutions to collection to delivery.

Secure a sustainable mail business
Link to key material topics Customer experienceRelevance of physical mailDigitalisation and data
Focus Areas Keep mail accessible, reliable and affordableAdapt MailNL organisation to market developments
Outcome indicator Customer satisfactionDelivery quality MailNL

While the ongoing decline in the mail market continues to have a large impact on PostNL and other postal logistic players in the market, we are reshaping our mail business model, continuing to invest in smart technologies, and developing cost-saving measures. As the designated provider of the universal service obligation (USO) in the Netherlands, we have a responsibility to maintain country-wide coverage and deliver on specific quality targets, ensuring accessible and reliable postal services at affordable prices. This means ensuring easy access to PostNL post boxes and retail locations, so that everyone can continue to use our network and connect with our services.

The consolidation of Sandd, which we finalised in 2020, will help us safeguard the key aspects of the postal service, while preserving decent labour conditions in what is expected to remain a shrinking market. Given our history and competencies, we believe we will have a key role to play in the future postal market in the Netherlands. We actively engage with the government, regulators and other stakeholders. And we aim to further intensify engagement with our customers so that we continue to meet future needs, including all the digital solutions that our customers have at their disposal, while keeping mail attractive and continuing to innovate together with our customers .

Attract and retain motivated people
Link to key material topics Engaged people
Focus Areas Workforce optimisation and capacity managementStrengthen employee engagementStay healthyRealise change
Outcome indicator Employee engagement

As one of the largest employers in the Netherlands, we provide thousands of people with job security, a stable income based on fair compensation for everyone, and opportunities for personal development and growth. We continue to focus on employing and retaining people who want to grow and prosper with us, which means providing attractive jobs, including training and development throughout our people's career, and adapting to their changing skill requirements. Next to attracting people in our operations we also focus on enhancing our digital DNA , for example by hiring digital specialists for our digital transformation programme.

By investing in sustainable employability and focusing on diversity, we believe we make the organisation stronger and create an environment in which people want to work.

This means offering jobs where safety and a healthy work environment are key, the value of which has been highlighted throughout the Covid-19 pandemic. And it means making people feel at home, working in an atmosphere that nurtures diversity and inclusivity, thereby helping create the long-term success of our company. When we decide to make changes in our organisation, we do this in close collaboration with our people in order to realise change responsibly.

Improve environmental impact
Link to key material topics Emission-free deliverySustainable logistics
Focus Areas Network efficiencyClean kilometresSustainable buildings and facilitiesGreen products and services
Outcome indicator CO2 efficiencyEmission-free delivery

At PostNL, we proactively take responsibility for the environmental impact of our operations, and have set ambitious targets to reduce our environmental footprint. We want to deliver all parcels and mail emission-free in the last-mile in the Benelux by 2030. And we have set an intermediate goal to achieve emission-free delivery in 25 city centres across the Netherlands by 2025 across all our networks.

But we are not only focusing on the last-mile. Our 2030 targets also include science-based emission reduction for larger vehicles, such as switching to biofuels that lead to cleaner kilometres, as well as progress on international logistic movements. We are making our buildings more sustainable and energy-efficient, for example by installing solar panels and LED lighting. We also engage with customers through developing green products and services. On a consolidated level, we have set targets to reduce our absolute and relative emissions towards 2030. Our Zero 2030 programme will enable us to significantly improve our environmental impact, contribute to our reputation as a sustainable company, and enable us to better connect to employees by giving their work more purpose. And we have the ambition to work towards net-zero emissions across our entire operations by 2050.

Generate profitable growth and sustainable cash flow
Link to key material topics Financial performance and position
Focus Areas Solid cash flow and capital managementSmart yield managementOperational excellenceContinuous focus on cost savings within MailNL
Outcome indicator RevenueNormalised EBITFree cash flowAdjusted net debtDividend per share

To create value for our investors and the company, it is vital that we focus on generating sufficient profits and cash flow throughout the company. Within Parcels we want to shape the growth in the e-commerce market and concentrate on balancing volume and value, by developing new markets, applying applicable pricing strategies, creating new packaging solutions, or offering new delivery options. We will also invest in our operations, such as network capacity and digital solutions, and focus on our operational excellence, which is a pre-requisite for providing the high-quality delivery that directly impacts customer satisfaction rates.

In our international business we are enabling customers and consumers to tap into the growing global e-commerce market. Spring is providing customers with more value-added options, for example by adapting its IT systems thereby enabling more options in logistical solutions.

Our Mail in the Netherlands business is focusing on continually improving the customer experience in a declining market. We are strengthening operational excellence and achieving cost savings by optimising our processes and increasing flexibility, while realising synergies through the integration with Sandd. At the same time, we use data and IT to innovate, such as further developing our digital capabilities. This helps us create a sustainable margin and cash flow.

Developing growth domains

In addition to our core strategy, we are also developing alternative growth domains related to our primary logistic propositions to create and develop future opportunities. We continued to explore and expand in two key growth markets in 2020: health and home & garden. Within the health segment, an increase in patients’ e-commerce expectations and a strong shift to home care in the health market are pushing the demand for home deliveries, and we are continuing to take advantage of these trends and are working towards being a leading health player in the Benelux. Food is a rapidly growing e-commerce market in the Benelux, and we are operating an open network for food deliveries to consumers and continue to introduce market-leading innovations for a wide range of customers.

By working closely with small innovative companies to explore new propositions, we are able to add value by challenging ideas and helping small companies to scale their businesses. And our strong brand helps open doors with investors or other stakeholders to pitch ideas to the market.

And to help support our aim of developing a future-proof business portfolio, we continue to invest in an investment fund, Endeit. This investment means we are better able to learn from and cooperate with companies connected to our growth domains.

Responding to opportunities and risks

Seizing opportunities is an integral part of our strategy and execution, and examples of how we did this in 2020 can be found in the 'Customer value', 'Social value', 'Environmental value' and 'Financial value' chapters later in the report. In the 'Risk and opportunity management' chapter we outline how we manage risk and opportunity, including identifying and mitigating the most relevant risks.

Seizing opportunities and managing risks forms an integral part of our strategy and execution.