September 5, 2014

Canada Post opens new $200 million processing centre at YVR Airport

Canada Post has officially opened a new $200-million, 700,000 square foot processing centre on Richmond’s Sea Island
For Immediate Release
Vancity Buzz

Canada Post has officially opened a new $200-million, 700,000 square foot processing centre on Richmond’s Sea Island, just north of Vancouver International Airport’s North Runway.

The new Pacific Processing Centre at 5940 Ferguson Road not only allows Canada Post to capitalize on the major growth of e-commerce across Canada and the Asia-Pacific Rim but also to streamline its operations in an effort to be more efficient and cut down on costs.

The facility joins Toronto and Montreal as Canada Post’s third major hub for processing and distributing international mail and parcels. It is adjacent to the smaller UPS regional processing plant and a short drive from the FedEx shipment centre near the South Runway.

“We’ve strategically located the new facility near the airport to reduce transportation costs of delivering mail to the processing centres,” Canada Post general manager of domestic parcel delivery Rod Hart told Vancity Buzz. “We are also outside of city traffic so we expect things to be much more efficient moving forward.”

Sitting on 42 acres of land, the new 1,500 foot long and 470 foot wide processing centre has replaced two older facilities in Metro Vancouver: the city-block sized Vancouver Parcel Delivery Centre on West Georiga Street in downtown Vancouver and the Vancouver Mail Processing Plant at No. 6 Road, Richmond.
The new state-of-the-art facility combines the two plants and can sort 12,000 packets, 10,000 parcels and more than 41,000 letters per hour on approximately 30,000 feet of conveyors. A parcel can make a full trip on the multi-layered conveyor system in just under 3 minutes.

Six-headed scanners read barcodes and hand written addresses to allocate each mail or parcel a specific roadmap on the conveyor system. The system is heavily dependent on machines and computers while staff working at the plant perform limited sorting duties and troubleshooting.

The entire process is monitored by numerous cameras and sensors viewed on television screens and computer monitors from a manned control tower. As well, international mail and parcels is inspected on-site by Canada Border Services.

About 1,000 people are employed at the processing centre, working around the clock in shifts of between 250 to 300 people. The week following Labour Day is one of the busiest times of the year, but it does not come close to Black Friday and Christmas, when daily volumes can grow exponentially.

On average per day, the centre will process four million pieces of mail, letters, parcels, packets, publications and other marketing mail. After the United States, the top originating countries in terms of volume received are China and Great Britain.

Management reports the new location and facility has been positively received by staff, who are enjoying the modernized working spaces and equipment. For added convenience, a Canada Post-operated bus for employees operates between the building and SkyTrain’s Templeton Station every seven to 10 minutes.
Unlike the old Canada Post mail building in downtown, the new facility holds the capacity to sort out these volumes. The old four-level, 1956-built mail centre on West Georgia was highly inefficient and severely undersized for regional processing needs, and there was also the added step of trucking mail to and from the airport through gridlocked city traffic.

In 2013, the crown corporation sold its downtown property to BC Investment Management Corp. (BCIMC) for a reported amount of $130-million. There is speculation the 686,000 square foot building will be redeveloped into a large mixed-use project that will include a hotel, residential units and a large-format retailer such as City Target, Walmart or even a City IKEA.

Meanwhile, major changes are expected to come for Canada Post’s operations as it strives to innovate and cut down on its costs to avoid a $1-billion deficit by 2020 due to declining volumes in mail.

Beginning this year, over a five-year implementation timeline, it will phase out door-to-door delivery of regular mail for one-third of the Canadian population – mainly those who live in urban areas. Stamp prices have been raised to 85 cents each if purchased in a bulk pack and one dollar if purchased individually.
Canada Post is also expected to reduce its workforce by between 6,000 to 8,000 positions or approximately 12 per cent of its total employees. An additional 15,000 staff are expected to retire or leave the crown corporation on their own will.