Experts divided over floor price for parcels in courier industry

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Some believe it may be the way forward in light of shrinking profit margins while others say it will only hurt consumers' pockets. FMTNews POS

There is a minimum price for sending documents but no such price for parcels at present.

On Jan 1, 2015, industry regulators Malaysian Communications and Multimedia Commission implemented a minimum price policy of RM5 for each letter weighing less than 500gm for courier companies. It said the move would curb unhealthy competition among industry players.

“It’s good to have some sort of base price, but you need to give the consumer a certain level of service. We need that to ensure commissions will be sufficient.Teong, who is also the managing director and group CEO of GD Express Carrier Bhd , was quick to point out that any talk about a base price has to be centred around consumer protection, which he said should be the industry’s “top priority”.

However, economist Carmelo Ferlito wanted to see more of a free market approach, stating that the sector should be as loosely regulated as possible. In October, MCMC announced a two-year moratorium on new courier service licences, saying it was to allow the government and the postal and courier industry time to formulate new plans to strengthen the sector.

 

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