Australia Post plans reforms

Australia Post opened what it calls a “national conversation” June 24, inviting the public to comment on recent and proposed changes to help offset losses due to declining letter volume.

The website for the national conversation is www.auspost.com.au/conversation.

One proposed change is offering a second slower level of mail delivery. This is referred to as second-class mail in some countries.

The June 24 press release said: “One of the ways the business [Australia Post] is seeking to limit the losses is through the introduction of the two-speed letters service for businesses, which gives the sender the choice of a slower speed at a lower price.”

This second-class service was introduced in June for businesses. A similar service for consumers may be offered as early as 2015.

Australia Post CEO and managing director Ahmed Fahour said, “Under this model, the postie still does his round every day, but the sender has choice on a price point and speed that suits their needs.”

Although not specifically mentioned in the press release, three-day-a-week delivery also has been discussed.

The Boston Consulting Group released its “Australian and International Postal Services Overview Report” in June, in which it found “that the strategic assumptions underpinning Australia Post’s case for postal reform are valid, and reform to the letters business is urgently needed.”

The report also stated that without reforms the expected letter volume decline, as much as 11 percent per year through fiscal year 2019-20, will soon overwhelm parcel profits.

Under the Australian Postal Corporation Act of 1989, Australia Post is required to earn a commercial rate of return.

Currently, Australia Post delivers an estimated 16.5 million items to 11.2 million addresses across Australia every day.