How often to you write a personal letter to a family member or friend? How often do you pay a bill through the mail? How well do you think the world’s post offices are coping with the digital era?
Things have changed. They have changed a lot and they have changed very quickly. Australia Post is looking at a number of new strategies to ensure it remains viable in a world where postage stamps are becoming museum pieces, along with public phone boxes, cheque books and good manners.
Last week Australia Post released its annual results. They are a revealing snapshot of how the company’s fortunes are changing. Revenues were up marginally, from just under to just over $5 billion But pre-tax profits rose 21%, from $329 million to $398 million, a good increase and a handsome margin.
The important figure is where the money comes from. Revenues from ”regulated mail” fell from $1950 million to $1924 million, and made a loss of $148 million. Regulated mail is standard postage, of which Australia Post has a monopoly. But the monopoly is not sufficient for it to turn a profit, which indicates how sick that business is. Australia Post has community service obligations, and must continue to sell stamps and carry letters.
“Non regulated parcels and retail” is where the money is. Revenues were up 8.5% to $3073 million, returning a profit of $546 million. So Australia Post makes much more money in an area where it competes in the open market than it does where it has a monopoly. Think about it.
Just as traditional letters have been declining (did you send out Christmas cards last year, or did you do a group email?), so parcels have been increasing, drive by the massive boom in online shopping. You might order it on the Net, but someone still has to physically get it to your house. That’s a boom industry, as the success of FedEx, DHL and UPs shows. Australia Post does well there, and wants to do better.
And there’s retail. There are no post offices any more, but Australia Post Shops, often in anonymous shopping centre outlets. The former post office buildings s, often the grandest in town or on the suburban high street, are now information centres and guest houses and restaurants. All in pursuit of a dollar.