Costly Management Decisions by the Numbers

FOUND ON A SOCIAL MEDIA SITE

1. Non-Labour Collection, Processing, and Delivery:
Costs increased by $21 million (+1.6%) to $1,381 million, due to higher international settlements and dealer fees, partially offset by lower transportation costs.
2. Property, Facilities, and Maintenance:
Costs rose slightly by 0.5% to $261 million, accounting for 3.8% of revenue.
3. Selling, Administrative, and IT:
Increased by 5.9% to $544 million, driven by higher IT services, travel, and consumer products costs.
4. Non-Capital Investment Expenses:
Jumped by 33.4% to $359 million due to system upgrades like ERP for ongoing transformation projects.
5. Depreciation and Amortization:
Increased by 9.5% to $353 million, mainly from capital investments like the Albert Jackson Processing Centre.
Conclusion:
Operating costs reached nearly $3 billion, about 1.5 times higher than the $1.851 billion spent in 2017, though the focus has been on deficits from declining parcel and letter volumes.
It seem like the deficit is more due to the continually rising operating costs rather than the decrease in letter and parcel volumes?
For reference, the operating costs in 2017 amounted to $1.851 billion. If operating expenses have increased by $1 billion in just six years, doesn’t this suggest that the company’s operations are heading in the wrong direction?
Management should have reduced operating costs or scaled back existing projects when deficits arose due to the decline in mail and parcel volumes. Instead, one of the reasons for the $748 million deficit is excessive business investments and overspending on operations without addressing inefficient cost management. The public needs to be aware of this issue.