Cost model for postal distribution in France
Cost model of the postal distribution in France
Business challenge
In the context of regulating the postal sector (price cap and the cost of Universal Service), ARCEP wanted a cost model of the postal delivery activity in France.
The model’s complexity, due to the variety of products and the geographic and demographic diversity in France, led ARCEP to outsource modelling to TERA.
Approach
The model simulated the cost of a local or nationwide postal operator by:
- Collecting operational data of French and European postal operators,
- Reviewing academic literature on postal economics,
- Using geographical data to determine optimal routes
Benefits and results
The model was validated by the national regulatory authority and is currently used in postal regulation. The model was presented in an official publication of the regulatory authority in 2012. TERA is one of the few global practices to carry out bottom-up models including all of a postal operator’s businesses.
Expertise:
Competition – Concentration
Client:
Pay television platform
