Home / Business and Politics / Ivan Čulo (HP): Strengthening Logistics and Digital Transformation with the Support of Croatia’s Membership in the OECD

Ivan Čulo (HP): Strengthening Logistics and Digital Transformation with the Support of Croatia’s Membership in the OECD

<p>Ivan Čulo</p>
Ivan Čulo / Image by: foto

Croatian Post constantly monitors market trends and develops strategic plans to be timely prepared for new business demands. In logistics, the trends are clear – a constant increase in volumes in parcel business and a decrease in the number of letters. In 2024, Croatian Post delivered 17.5 million parcels, which is almost 20 percent more than the previous year.

The year 2025 continues in the same direction. In the first quarter of this year, parcels accounted for 24.2 percent of the market, and the growth trend is expected to continue in the coming years. With the new delivery system, which we have been implementing since spring, and the purchase of 200 new parcel lockers, which nearly doubles our network, we expect to be ready for the growth in parcel volumes. However, more than half of Croatian Post’s revenue still comes from letters and registered mail.

With Fiscalization 2.0, in the next two years, we expect the transition of such shipments from the physical delivery process to the digital world, and Croatian Post is ready for that as well. Sveračun – our service for digital invoicing – is ready even before the legal deadline. Our goal is to be a market leader in the digital invoicing segment with over 40 percent of the market using Sveračun. Like all other services of Croatian Post, Sveračun will be tailored to both entrepreneurs and private individuals, at affordable prices, as we do not focus on short-term goals and quick profits, but aim to serve the citizens.

The adaptation to sustainable business is integrated into our strategy. We have implemented an ESG framework and CO₂ emission reduction targets, along with a transition plan aligned with the Science Based Targets initiative for climate neutrality. Warehouse automation, delivery optimization, parcel lockers, and the growth of the electric fleet reduce carbon footprint and increase efficiency.

Emissions have been reduced by 18 percent, and ‘green kilometers’ have increased by 2.5 times, confirming our role as a leader in the green transition. The workforce represents a challenge, as it does for the entire economy, as well as for Croatian Post. We are aware that the post is strong as long as users are satisfied, and our first ambassadors are our postal workers and operators in post offices. Under my management, Croatian Post has raised salaries for operational workers by a total of 70 percent.

Only this year, salaries will increase by 20 percent through three rounds. We have introduced annual bonuses, increased variable compensation, and designed a more logical delivery system. The goal remains to improve working conditions for operators. Therefore, we have initiated a reorganization of the entire company’s operations to digitalize processes as much as possible, eliminate unnecessary activities, relieve administration, and create space for salary growth in operations. The absence of elections means political stability, and stability means a calm period in the business world. Although Croatian Post is much more focused on market events than on political ones, a period without elections, primarily without political campaigns, also brings us additional peace as we have sometimes been used as a tool in political conflicts, especially at the local level. However, this does not affect the strategy of Croatian Post, which is carefully designed and systematically implemented.

Riding on the wave of good financial results from last year, in which our revenues increased by almost 20 percent compared to 2023, we continue the positive trend in the first two quarters of this year. Business revenues amount to 140 million euros, which is above last year’s level for the same period. EBITDA amounts to 7.7 million euros, which is in line with the planned, thus maintaining stable operational efficiency despite challenging market conditions and additional investments in the workforce. At the same time, thanks to discipline in cost management, we have managed to somewhat neutralize the impact of rising labor costs on operational profitability.

In the second half of the year, we will further focus on strengthening operational capacities, with a special emphasis on better utilization of logistics and warehouse resources, where we recognize significant room for revenue growth and increased efficiency. Our focus remains on stable and sustainable growth, with clear cost management and strategic investments in business segments with higher added value. Capital projects that have already begun implementation include the expansion of the parcel locker network and the purchase of electric tricycles – tenders worth a total of 6.8 million euros, the procurement of an automated small parcel sorting machine worth 7.2 million euros, and the construction of a new high-bay warehouse that will have 40,000 pallet spaces on 20,000 square meters.

The warehouse is in the design phase, and we estimate that this investment will amount to 12 million euros. The expansion of the business into pallet operations is accompanied by the establishment of the subsidiary PostLogistik, which will introduce the pallet delivery brand Cargo. Croatia’s entry into the OECD is a strategic goal of our Government, and as a state-owned company, we support this intention and believe that Croatia will soon become a member of this exclusive society. Membership will bring about positive changes throughout the economy, and the rules that the OECD has for its members are also welcome, and Croatian Post is already guided by them.

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