External developments

The domestic and international e-commerce and physical communication markets in which we operate are dynamic. Macroeconomic pressures are leading to more expensive goods and services for customers and consumers, while the tight labour market is making it difficult for companies across a range of sectors, including ours, to fill vacancies. However, a range of innovations, including in the field of AI-driven solutions and robotics, generate new possibilities for how we conduct business. In light of our value chain discussed in the previous chapter, in this section we explain in greater detail how these external developments influenced PostNL in 2024.

Geopolitical and economic developments

The ongoing impact of Russia’s invasion of Ukraine and the outbreak of hostilities in the Middle East in October 2023 continued to cause terrible human suffering in 2024. At the same time, rising inflation has led to increased costs in several areas, including salary expenses. These rising costs, driven by higher energy prices, transportation expenses, supply chain disruptions, and increasing scarcity of resources, have affected businesses, their customers, and partners alike. Despite implementing adaptive measures, these challenges have significantly increased logistics expenses.

Economic trends and inflation are also influencing the purchasing behaviour of both customers and consumers, with both segments becoming more cost-conscious and displaying heightened price sensitivity. While consumer confidence is beginning to show tentative signs of improvement, it remains historically low, leading to notable changes in spending patterns within the e-commerce sector. One of the key shifts is the tendency of consumers to delay purchases, reflecting increased caution amidst ongoing economic uncertainty. Additionally, customers are placing a clear emphasis on cost control, a trend evident across both the e-commerce and mail markets.

These dynamics are accompanied by structural changes in the competitive landscape of e-commerce, including a growing presence of Asian webshops, which are reshaping market conditions. Among the most significant challenges is the accelerating trend of customer concentration, with the largest customers continuing to expand their share of the market. This has resulted in fewer but larger players wielding increased influence, which has had the greatest impact on declining margins in the e-commerce segment.

As a result of these shifts, businesses face an increasingly complex operating environment. Volatile consumer behaviour, combined with a preference for larger and more established providers, has heightened competitive pressures. The combination of these factors, alongside persistent high costs and inflation, continues to place downward pressure on profitability, underscoring the need for operational adaptability and innovation in service delivery.

In the Dutch mail market, mail volumes continued to decline, with an increasing number of customers opting for within two day delivery over traditional next-day options. Additionally, the volume of seasonal mail sent in December was lower than expected. More information on this topic, including PostNL’s request for temporary government financial support under the Dutch General Administrative Law Act to cover net USO costs for 2025 and 2026, can be found in the Future of Mail box later in this chapter.

Additionally, details of the steps we took to mitigate the issues outlined above can be found in the Risk and opportunity management chapter.

Labour market

The labour market in the Netherlands continued to remain tight in 2024, illustrated by low unemployment rates compared to the long-term average, and a high number of open vacancies. The tight labour market is caused by a number of factors, including an ageing population, greater segmentation in the labour market, and a higher percentage of the population that works part-time.

While our mail delivery jobs are part-time, we need to compete in an economy that offers a wide range of part-time opportunities in retail, hospitality, and office-based roles. This, alongside the other factors listed above, made it challenging for PostNL to recruit in some regions, with Mail in the Netherlands particularly badly affected. The labour shortage also led to delivery delays across a number of postal routes, impacting delivery quality levels.

In addition to the challenges of a tight labour market, PostNL experienced higher labour costs due to significant increases in the statutory minimum wage in the Netherlands, effective from 2023. Our collective labour agreements (CLAs), which are integral to providing sustainable employment and ensuring fair wages, benefits, and working conditions, also contributed to these rising costs. These increases in labour expenses were a key driver of the overall cost pressures faced throughout the year, necessitating corresponding adjustments to our pricing strategy.

Additionally, the composition of the workforce is evolving, with shifts in age, ethnicity, and other demographics. Alongside these changes, there is a growing societal emphasis on inclusion and equality. As a company that values diversity, equity and inclusion, PostNL embraces this trend. Our commitment to fostering a diverse workforce and an inclusive culture, as well as details on how we responded to the developments outlined above, can be found in the Social value chapter.

Ongoing digitalisation, robotisation and the rapid development and deployment of AI

Rapid advancements in technology, particularly in the field of AI, are reshaping how businesses operate, and the possibilities for leveraging data seem limitless, benefitting both customers, consumers and PostNL employees.

We use AI to optimise logistics and predict demand, improving delivery efficiency. Digital solutions help manage peaks, forecast supply and demand, and streamline routes. Innovations like robotisation in sorting centres enhance speed and efficiency, benefiting both PostNL and customers. Automation also supports employees by reducing physical strain and improving workplace ergonomics. However, a shortage of skilled staff or resources could hinder AI integration, impacting competitiveness.

Looking ahead, digitalisation will continue to elevate the entire logistics value chain—from smarter ordering and automated fulfilment to seamless payment and delivery—thereby driving greater efficiency and improving experiences for customers and consumers alike. An overview of how our digital propositions are utilised across the company can be seen in our infographic in the Our value chain section.

The increased use of data also heightens the need for robust cybersecurity measures to mitigate the rising risk of data breaches. This involves managing cybersecurity risks across the company by implementing essential protections, such as multi-factor authentication and encryption, while maintaining preparedness in case of incidents. In 2024, for example, we enhanced security by implementing an anti-phishing code in customer emails, and introduced PostNL eID for secure digital identity in the Netherlands and Belgium.

We also began preparing for the implementation of new regulations in NIS2, which are expected to come into force later in 2025. More information on NIS2 can be found in the Regulatory developments chapter. In parallel, digitalisation is driving the growth of digital alternatives to mail, including electronic invoicing, social media, and digital marketing, all of which continue to contribute to the decline in physical mail volumes. More information on our digital transformation can be found in the Customer value chapter.

Consumer in control

In e-commerce, the voice of the consumer has never been more important than it is today, and we play a vital role in connecting e-tailers with consumers. Consumer behaviour has become increasingly volatile, with preferences and expectations shifting rapidly in response to evolving market trends. Consumers today demand greater flexibility, transparency, and convenience in their online shopping experiences. They seek control over when, where, and how their purchases are delivered. To address these demands, we have introduced the option for consumers to direct their delivery to a specific PostNL point in their neighbourhood, or to a location of their choosing around their home. This added layer of convenience and flexibility empowers consumers to tailor the delivery process to fit seamlessly into their daily lives. By offering these and other delivery preferences, we put the customer in charge, ensuring we remain the favourite deliverer, trusted by consumers to provide reliable and tailored solutions that suit their evolving needs.

The multi-vendorship model, where consumers can select the logistics provider for their orders, continues to gain traction. In response, we are collaborating with e-tailers to offer more personalised and adaptive delivery options, empowering consumers to choose during checkout whether to have their parcel delivered to one of our APLs, a retail point, or directly to their home address. This approach allows us to meet their needs while ensuring a seamless and reliable delivery experience.

At the same time, we see that consumers want to have access to enhanced tracking, flexible delivery windows, and greater communication during the delivery process, and at PostNL this increasingly takes place through our app, which again saw an increase in the number of downloads in 2024. More information on how we help the consumer to remain in control can be found in the Customer value chapter.

Importance of ESG

At PostNL, we take pride in embedding sustainability at the heart of our operations, making meaningful progress across a broad spectrum of environmental, social, and governance (ESG) topics¹. This commitment is driven not only by our own convictions but also by an evolving regulatory landscape. Growing concerns about climate change, increased focus on human rights, adherence to regulatory compliance, the emphasis on diversity, equity and inclusion, and transparency in responsible business practices are all factors impacting our approach, as is our dedication to creating employment opportunities for those with a distance to the labour market.

New European sustainability regulations, such as the CSRD, present both challenges and opportunities. While they require investments and attention, they also offer PostNL the chance to enhance our sustainable value proposition by providing customers and consumers with products and services that lower our impact on the environment, while remaining reliable and accessible.

More details on how we leverage sustainability as a positive force for change can be found in the Environmental value and Social value chapters. Additionally, more information on our CSRD-related disclosures can be found in the Environmental disclosures ,Social disclosures and Governance disclosures of the Sustainability statement.

Competitive landscape

Parcels

The competitive landscape remains intense, with price pressures exacerbated by client concentration and differing strategies among market players regarding the passing on of costs. This underscores the importance of service quality and continuous innovation in maintaining market share. These dynamics are already posing a risk to the level of innovation within the sector, where adaptability and advancement are essential to sustained success.

At the same time, a tight labour market and evolving consumer behaviour are also contributing to an e-commerce sector that is changing. As the market matures, sustainability and working conditions are increasingly important. These developments are leading to a more sustainable and attractive, yet inherently more costly, e-commerce chain. Addressing these challenges and achieving a balanced distribution of value is a shared responsibility across the sector.

At PostNL, we are committed to responding proactively. We remain confident in the long-term growth potential of e-commerce, driven by increasing online penetration and the ongoing shift in market share from offline to online channels. Examples of how we continue to adapt to market dynamics and strengthen our position in a competitive environment can be found in the Customer value chapter.

International e-commerce dynamics

On the international front, competition is also increasing as traditional logistics players strengthen their positions, leveraging their global networks, expertise, and technological investments. This includes investing in new distribution centres and warehouses and connections across Europe.

The competitive landscape is further shaped by the rapid expansion of large e-commerce platforms. These players are extending their geographic presence and solidifying their role within the logistics value chain. Strategic partnerships and the creation of proprietary logistics networks highlight their ambition to dominate fulfilment and delivery services. However, challenges persist in the global marketplace. Increasing protectionism policies present a potential headwind, as trade barriers and regulatory constraints may dampen cross-border trade volumes, impacting growth opportunities for international logistics operations.

Mail in the Netherlands

The mail market continues to face significant challenges, driven by a multi-year and accelerating trend of declining volumes, primarily due to the widespread adoption of digital communication. Despite this, physical mail remains indispensable for key sectors such as government agencies, legal firms, and financial institutions, which rely on secure and private delivery of sensitive materials like contracts and bank cards. Additionally, direct mail marketing offers businesses a powerful way to create sensory customer experiences, influencing purchasing decisions and strengthening B2C connections, while millions of magazines are delivered to households across the Netherlands each year. For many consumers, physical mail also retains its value as a cherished means of communication with friends and family.

PostNL has made every effort to offset the costs associated with declining mail volumes through our strategy of cost savings and price optimisation. However, we have made it clear that these measures alone are no longer sufficient to provide the solid financial foundation needed to invest in our people, our network, and the future of postal services for our customers. More information on this, including PostNL’s request for temporary government financial support under the Dutch General Administrative Law Act to cover net USO costs for 2025 and 2026, can be found in the Future of Mail box later in this chapter, as well as in the Customer value chapter, which provides additional insights into all the topics outlined above.

The Dutch postal market has evolved into a landscape with three main types of players: niche operators that consolidate large mail volumes but depend on other postal companies for delivery; smaller, regionally or locally based postal companies connected to organisations active in offering work in the community; and PostNL. This shifting environment requires mail companies to constantly balance between adapting to digital competition and preserving the unique value of physical communication.

Regulatory themes

Compliance is vital for ethical operations, protecting rights, and meeting legal duties. We take a proactive approach, engaging regularly with governments and regulators to anticipate changes and enhance compliance. We have identified two key compliance risks:

Supply chain accountability

Working with third-party suppliers for transport and delivery carries risks. Supplier non-compliance—on labour laws, environmental standards, transport safety, or ethics—may lead to legal disputes, fines, reputational damage, and loss of trust.

Legal and regulatory developments

Regulations are becoming more complex in postal services, labour, health and safety, competition, trade, data protection, and sustainability. The Corporate Sustainability Reporting Directive (CSRD) shapes our regulatory alignment, while the double materiality assessment (DMA) helps identify key ESG standards.

Further details on our compliance strategy are in the Ethics and compliance and Risk and opportunity management chapters. Key regulatory developments are in Regulatory developments chapter, while our 2024 ESG strategy, governance, and performance are outlined in the Sustainability statement.

1. See the DMA box earlier in the chapter for details on our engagement with stakeholders to identify key ESG topics.