02.Small business woes
Smaller Australian businesses say they are finding it difficult to compete in the online marketplace as they are unable to offer a free shipping service. Patricia Fitzgerald, owner of small business Unique Babeez, believes the problem lies with a lack of competition. “We small businesses are getting the bad end of this with Australia Post jacking up their prices. It makes it really hard, as if we put our prices down to try to combat [higher postage] we are then not getting what we deserve for the efforts put into the work!”
UK retailer The Book Depository incorporates shipping charges into its sales price, taking advantage of bulk mailing discounts. Large UK stores are also able to gain a competitive advantage by skipping several steps in the postal chain. Australian retailers are unable to make such savings.
“Australia Post doesn’t have that structure,” says Tony Nash, CEO of Australian online bookseller Booktopia. “We do take advantage of some discounts – volume discounts exist, pre-organising your parcels and letters into state/post code order is also important.”
“The cheaper you make shipping, the more orders you can take,” says Nash.
Not all bad news
While its international postage rates can be expensive, Australia Post has responded to the need for cheaper local rates to cater to the online shopping market by launching a new fixed-price parcel service.
The flat-rate mailing boxes released in partnership with eBay come in three standard sizes, and items weighing up to 15kg can be sent anywhere within Australia. Sending small parcels with items such as DVDs, books and cosmetics will cost $8.20, medium boxes of shoes and small electronics will be $12.75, and large items such as toys, clothing and larger electronics will cost $16.25 to deliver. All prices include packaging.
The flat rate services are integrated with Australia Post’s Click and Send service, an online portal for domestic and international parcel shipment, and can be bought from auspost.com.au.
CHOICE welcomes the move towards flat rate shipping and believes it provides retailers and consumers with greater certainty, and supports the extension of this model to international post.