kopi-C with CFO of SingPost: Rebuilding the network behind Singapore's mail

The mail problem

SingPost is a company that needs no introduction. Yet while postal services existed in Singapore since before independence, its core mail business continues to shrink significantly. 

For Chief Financial Officer Isaac Mah, who is seven years into his time at the company, he and the management’s job is to figure out what comes next.

"Mail decline is not new," Mah says. 

Last year alone, mail volumes fell 13.5%, and by Mah’s account, "We've not hit the bottom yet." 

But for a company whose entire brand has been built on this core service, this decline forces a question: what can SingPost then deliver instead?

Mah's answer starts with what already works. 

SingPost, he says, is the only logistics operator in Singapore that delivers to every address, every working day. 

It runs a fleet of more than 700 drivers and operates over 2,500 touchpoints nationwide—a network dense enough that 80% of the population sits within a 10-minute reach of one of them. 

"That is an unparalleled advantage that we have versus other logistics operators," he says. 

The strategic question, in his framing, is less about whether the network is valuable, and more about how quickly SingPost can redirect it away from letters and toward parcels, healthcare, and other services.

This redirection is not simple by any means. 

To start with, SingPost operates under a service obligation to deliver 99% of mail items by the next day, a standard that Mah says demands "a significantly different setup" from parcel delivery. 

Letterboxes, the cheapest and most efficient delivery point given Singapore's high-rise housing, were not built with e-commerce parcel sizes in mind after all. 

Larger items still require doorstep delivery, which Mah describes as the most time- and cost-intensive way to serve a customer in a city of high-rises.

Building for what's next

The pressure on SingPost's mail business is not unique to it. 

National postal operators worldwide, from Deutsche Post DHL to Australia Post and Europe's national posts, have faced the same structural decline in letter volumes over the past decade, and have converged on a similar response: leaning on parcels, logistics, and adjacent services to offset it. 

SingPost’s pivot has followed a similar playbook, with the launch of a S$30 million automated parcel sortation facility at its Regional eCommerce Logistics Hub in Tampines. 

The upgrade, which includes two new automated sorting machines serviced by autonomous guided vehicles, triples the small, medium and large parcel processing capacity, and consolidates operations that were previously split across two locations.     

Mah describes the investment as a way to both increase capacity and lower the cost of serving the volumes SingPost already handles, all while opening the door to further automation, including trials of autonomous vehicles for last-mile delivery (developed in partnership with the Land Transport Authority).

Parcel growth itself, however, comes with a caveat Mah is careful to draw out. 

Domestic e-commerce volumes grew 8% last year, and SingPost intends to keep growing that segment, though not indiscriminately. 

"Pricing discipline is very important," he says, describing e-commerce delivery as a market where "competition is fairly cutthroat and margins are very, very thin." 

A postage rate adjustment introduced this year gives the mail business some breathing room, he adds, but it will not be a long-term offset if volume declines continue at their current pace.

Retreating to refocus

Perhaps the more consequential shift, though, is geographic. 

Over the past 18 months, SingPost has exited roughly a dozen international markets, refocusing its logistics operations on Singapore, Malaysia, and China. 

The most prominent of these exits was the divestment of its Australian logistics business, a market Mah says the company grew successfully but at the cost of taking on significant leverage to do so. 

When an unsolicited offer for the Australian unit arrived, SingPost then undertook an international competitive bid process and brought the proposed divestment to shareholders, who approved the sale at an extraordinary general meeting

"That kind of set the tone of where the next phase of the strategy would be," Mah says. 

The proceeds, he notes, have meaningfully reduced the group's debt and freed up cash to reinvest domestically. 

In its remaining regional footprint, SingPost continues to hold a stake in Malaysian courier GDEX, and has recently struck new partnerships with SkyNet Worldwide Express and Asendia to expand its cross-border e-commerce reach.

As part of its domestic strategy, healthcare is the newest thread. In May, SingPost signed a memorandum of understanding with Fullerton Health to explore a joint healthcare delivery network, an idea Mah traces directly back to the postal network's dual identity. 

"We are the only logistics operator in Singapore that also has a retail or civic-facing front," he says, pointing to SingPost's 40 post offices alongside its delivery fleet. 

One example of that civic reach in practice can be seen in SingPost's role processing more than 100,000 transactions for a recent Singtel shareholder exercise, carried out with fewer than 10 complaints.

The same combination of delivery and physical presence, he argues, could naturally extend into bringing medication—and potentially care—to patients at home.

What to watch

As for the post office network itself, it is being reshaped rather than reduced. 

Thus far, SingPost has committed to maintaining 40 manned and unmanned touchpoints, though their format will vary by location with some counters shrinking in favour of self-service lobbies and freed-up space rented out. 

A similar logic applies to SingPost Centre in Paya Lebar, where the company still runs more than 200,000 square feet of sorting operations. 

As some of that activity migrates to the Tampines hub, Mah says SingPost is preparing to refresh the mall and explore new uses for the freed-up space, including a possible boost from height restrictions being lifted once a neighbouring air base relocates in 2030.

Asked how investors should judge SingPost's progress, Mah points to a single measure: segment profitability. 

Property remains the group's largest profit contributor today, generating over $80 million in revenue and $45 million in profit last year, while the logistics and post office network segments are earlier in their turnaround. 

"In two years, I would like to see all segments generating healthy profits," he says.

SingPost's Post Office Network narrowed its operating losses by more than a quarter last year, and as of today, the sortation hub in Tampines is already a live facility processing parcels. 

While the healthcare partnership and further automation are still to be proven, several of its next moves are now underway and no longer mere proposals on paper

About Singapore Post Limited

Singapore Post (SingPost) is the country's leading postal and eCommerce logistics provider. The portfolio of businesses spans international postal services, warehousing, fulfilment and last mile delivery, serving customers in more than 220 global destinations. Headquartered in Singapore, SingPost has approximately 3,000 employees. Since its inception in 1858, the Group has evolved and innovated to bring about best-in-class integrated logistics solutions and services, making every delivery count for people and planet. 

About kopi-C: the Company brew

kopi-C is a regular column by SGX Research in collaboration with Beansprout, Singapore’s trusted investment intelligence platform which helps everyday investors build the knowledge and confidence to make decisions that matter. kopi-C features C-level executives of leading companies listed on SGX. These interviews are profiles of senior management aimed at helping investors better understand the individuals who run these corporations.