- Australia Post is struggling due to a sharp decline in its letter delivery business.
- Parcel deliveries are growing, but the sector is increasingly competitive.
- The federal government has asked Australians to share their thoughts on how to modernise Australia Post.
Its parcel delivery business is growing steadily thanks to our new thirst for online shopping, but it’s facing stiff competition from courier providers in terms of delivery times, reach, quality of service and price, at a time when delivery costs are rising.
So how does Australia Post work, why is it in trouble now and what could this mean for the future?
How is Australia Post managed and funded?
Much of the network is operated by private individuals acting as licensees, agents or franchisees.
Why is it in trouble?
Australians received an average of 2.4 letters each week in the 2022 financial year, down from a peak of 8.5 letters in the 2008 financial year. By the end of the decade, Australia Post expect us to receive less than one letter per week.
Australians received an average of 2.4 letters each week in the 2022 financial year, down from a peak of 8.5 letters in 2007-2008. Source: SBS News
At the same time, post offices conducted 192 million transactions in the 2022 financial year, 22 million fewer than in 2019.
Australia Post has said it expects visits to keep declining with the continued shift to digitised services.
Australia Post has said it expects visits post offices to keep declining with the continued shift to digitised services. Source: SBS News
Meanwhile visits to Australia Post’s digital channels were up 25 per cent in the 2022 financial year from the previous year to 902 million.
Parcel business becoming ‘highly competitive’
Australia Post delivered 526 million parcels in the 2022 financial year, more than double the 226 million it delivered in the 2013 financial year. And it expects parcel volumes to grow in line with longer-term retail trends.
“Most of the players are developing a competitive edge through the infusion of technology in their systems, like the use of drones and WMS system,” it added.
Will we see less regular letter deliveries?
There are more than 4,300 post offices throughout the country, with more than 2,500 of these in rural, regional and remote areas, while Australia Post directly employs more than 36,000 people and more than 60,000 indirectly.
There are more than 4,300 post offices throughout the country, with more than 2,500 of these in rural, regional and remote communities. Source: SBS News / Leon Wang
Minister for Communications Michelle Rowland said the government wanted to help Australia Post adapt to changes in technology, commerce and consumer expectations.
“I encourage all Australians to have their say, especially small businesses. Your opinion will help us as we consider options to shape postal services, and sustain Australia Post now and into the future.”
The government says it wants to modernise Australia’s postal services to ensure they are financially sustainable. Source: AAP / Dean Lewins