Following the development of a recyclable envelope with a glassine paper window, Postal Technology International speaks to Luca Palermo, Nexive CEO, about future developments and the challenges of operating in the Italian postal market. Nexive, a subsidary of PostNL, is currently one of the largest independent postal operators in Italy.
Why did Nexive decide to develop a sustainable envelope with a glassine paper window?
Nexive intends to mitigate the environmental footprint of the business and this is the reason behind many of our initiatives. At present we use more than 400 bicycles for mail delivery in Italy and 100% of the energy we use is certified and produced by renewable sources. We have also ensured that our logistics processes have been optimized and that products used on a daily basis have a low environmental impact. This includes the sustainable 100% paper envelope.
Who did Nexive work with to create the product?
Our envelope and paper provider developed the product at our request. Glassine is a smooth and glossy paper that is air, water and grease resistant. It is manufactured by supercalendering (after pressing and drying, the paper web is passed through a stack of alternating steel and fiber-covered rolls called a supercalender). The material already existed but had not been used on a paper envelope.
What were the challenges of developing this new material?
The main challenges we faced came from the transparency of the new material and setting our scanners to be able to read the barcode and address details through the window.
What are the benefits of using Nexive’s eco-flyer envelopes for protecting mail, flyers and small parcels over traditional packaging?
Eco-flyer envelopes were introduced in March 2013, for internal use only. They were used to carry registered mail among our branches throughout Italy. They had been internally tested (resistance to rips, rain and transportation) so then they were ready to be used as a basic packaging for our parcel services. Compared to a normal plastic flyer, the production of an eco-flyer saves up to 60% on CO2 emissions. It has been made with more than 80% of post-usage recycled plastic and it is completely recyclable.
What has the response been like from customers?
Both products have been well received by customers as a sustainable product is perceived as a better product. We also offer the ability to produce co-branded envelopes and flyers so that companies can gain brand reputation using a premium product without paying a premium price.
What were the biggest challenges that Nexive faced being the first private operator in the Italian market?
The key challenge was, and still is, providing a premium delivery service to companies and citizens and offering competitive prices, even if Nexive is not actually operating in a fully competitive market. The liberalization process of the Italian postal sector, which only started in 2011, is still in progress and has been slowed down by lobbies protecting the national operator. As the key private leader, Nexive feels the responsibility to spread information on the anachronistic privileges of the incumbent and to support the new laws which will guarantee a truly open market. These laws will boost private postal operators’ growth, by allowing them to deliver better and cheaper services to families, as well as to private and public organizations.
Have there been any recent developments in the last year that have had a major impact on the Italian postal market?
The new competition draft bill is a positive step toward the total liberalization of the postal market, since the Italian government has implemented some of the Antitrust Authority’s recommendations. This includes the abolition of the legal reserve of the Universal Service provider (USP), which still exists in Italy for two postal products – judicial acts and fines. According to the third postal directive, member states must no longer keep reserved areas on postal services. Only Italy, Poland and Portugal still have a reserved area. If approved, the changes will come into effect from June 2016.
The bill still has to be implemented, but it’s an encouraging action that will line Italy up with the other EU member states. Nexive also promotes downsizing the Universal Service scope to include just consumer mail. At the moment it includes consumer and bulk business mail and gives the USP a 22% VAT discount advantage over private competitors.
Beyond the liberalization topics, some other positive trends are impacting the Italian postal market. Trends around the growth of e-commerce are urging operators to rethink their business model by offering parcel and digital services. This represents an opportunity for operators who are able to combine physical and digital services to deliver an integrated document management service and to use new technologies to streamline processes and improve services. Nexive is actually building on both these trends to develop its portfolio in order to better address the offering to customers and companies.
How closely do you work with your parent company PostNL and are there plans to roll the green envelopes out with them?
We are part of PostNL, but of course we can autonomously develop business strategies to operate in the best way in the Italian market. The Italian postal market is different from other countries in Europe, including the Netherlands, so we have the responsibility to deploy the most suitable business model.
As we believe in sustainability, we put our economic, social and environmental sustainability at the core of our strategy. That’s why we pay attention to Italian certifications such as the Legality Rating, as well as collaborating with non-governmental organizations (NGOs) to support local charity projects. Our investment in the green envelopes is part of our local commitment, but we are sure this best practice will also be followed by other subsidiaries within our group, as well as by other operators in the market.
What are Nexive’s plans for the future?
Nexive’s mission is to be the number one postal platform in Italy and to deliver the best integration between physical and digital services in order to meet the needs of Italian consumers. That’s why we’re investing in new technologies to make our services more efficient and more effective, and we’re also expanding our network to better reach the Italian population despite some difficulties in geographic location. By 2019 we expect double-digit growth.
Interview by Daniel Symonds
August 18, 2015