Australia Post Accused Of Creating Small Business Nightmare Before Christmas
Australia Post has been accused of robbing small businesses of profits in a Grinch-like move before Christmas.
Rival delivery service Sendle claims Australia Post has hit customers with the 'biggest price hike in decades' by increasing parcel fees by an average of seven percent.
Australia Post introduced price changes for domestic and international parcels and letters on September 30, ahead of the busiest retail period of the year.
Use of the postal service skyrockets ahead of the Christmas, Boxing Day and New Year period as customers send gifts, cards and letters to their loved ones. It's also a busy time for retailers who will be rushing to fill online orders.
Sendle claims Australia Post's price changes mean the average cost to send a parcel with the service will cost a whopping four times the inflation rate.
The company pointed out that it's Australia Post's second price hike in 2019.
Australia Post has refuted the claims they've increased their prices saying their customers will actually save money under the changes. The government-owned company said they have moved from a weight-based model to a sized-based model to make sending a parcel less complex for customers.
"Many of our customers will actually pay less, especially those sending small heavy items and those sending to or from rural and regional Australia," an Australia Post spokesperson said in a statement obtained by 10 daily.
"We’re moving to national flat-rate pricing for sending parcels anywhere in Australia -- much simpler for customers and providing certainty of price upfront."
Australia Post said it's more a 'price change' than a rise. The change in prices reflects a change in model, rather than a rate increase. Previously Australia Post offered national flat rates based on weight --500g, 1kg, 3kg or 5kg-- but from Monday the company moved to a national flat rate based on size.
"New national flat rate satchels will come in four sizes --small, medium, large, extra-large-- and you can pack up to five kilos in any of the satchel sizes," the spokesperson said.
The company's website also states plans to increase the price of sending small and large letters by 10c.
Australia Post has notified the Australian Competition and Consumer Commission that it wants to lift the Basic Postage Rate from $1 to $1.10.
Postal Wars Ahead Of Christmas
Sendle says they are combatting predicted price pain for small businesses by offering a so-called 'relief package'. The postal rival is promising customers a flat rate of $12.95 to send a 250-gram package anywhere in the world throughout the Christmas period.
The offer also includes a free kilo when customers ship two kilograms of goods.
"The last thing they need is another price increase to squeeze profitability in the busy holiday season. Small businesses shouldn’t have to be burdened with buoying up Australia Post’s profit margin in this make or break period," James Chin Moody, co-founder and CEO of Sendle said.
Australia Post announced pricing changes after the company reported a 70 percent decline in net profit for the past financial year. Overall Australia Post's profits fell to $40.6 million.
The decline was attributed to a massive drop in demand for its letter delivery service.
Revenue from letters fell nine percent, draining an eye-watering $2.2 billion from the company.
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