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Postage costs soar by 30% as online retail booms

Higher costs: The price of prepaid packages have risen.

Higher costs: The price of prepaid packages have risen. Photo: Glenn Hunt

The prices of prepaid Australia Post packages have been raised by up to 30 per cent to take advantage of the online shopping boom.

For the first time, most of Australia Post's revenue comes from parcels instead of letters, and 70 per cent of parcels are from online transactions.

The rises, which come into effect on Monday, also mean the cost of getting a signature on delivery, a requirement for most online sellers, almost triples from $1 to $2.95.

Online retailers say the changes are a ''direct hit'' on their businesses and they have no option but to charge customers more.

Australia Post defends the increases, saying it is ''operating in a challenging business environment with increasing external costs''.

Jackie Harper of Dubbo, who sells cloth nappies online, said she would now have to pay more than $11 every time she sent a package. Last week it was about $7.

''These prices are passed on to the customers and need to be paid each time an order is sent,'' Ms Harper said.

Many online business owners say they were told of the increase only last week and have had no time to adjust their prices. Others are concerned their customers will go to more attractive sites overseas.

Until Monday, it was cheaper for online sellers to use Australia Post satchels and the signature service than their own packaging and stamps.

More than 1000 online retailers have signed a petition in the past two days to protest against the changes.

In one year the value of the online retail market has grown by $2 billion. It is now worth $13.1 billion, according to figures from the National Australia Bank.

Australia Post is only too aware of this, having paid $408 million to Qantas in October for the remaining 50 per cent of freight provider StarTrack.


  • This stinks. It just irritates me that government services act as profit centres and Australia Post is the most profitable service the government provides. We pay taxes for services to be provided and we accept they will run at a loss to keep the service cost effective for the public. That's what taxes are Stop ripping us off!

    Date and time
    April 08, 2013, 8:18AM
    • Why should our taxes subsidise any government service if the market is prepared to pay for that service to operate at a surplus? Telstra ran a profit and make plenty of dividend payments to the government helping to reduce our taxes. Why should Australia Post be any different? It's not like this is going to make online shopping less competitive to retail - the gap is way too big.

      However, 2012 Australia Post announced a $2bn investment in further automating it's services and posted a $300M profit. So even using my own logic, Australia Post seems to already be making a tidy profit (at least a few years ago).

      Date and time
      April 08, 2013, 8:46AM
    • What government services?
      ...they've all been sold - and the post is no exception.

      Be careful when choosing your government, because this is what can happen.

      what world
      Date and time
      April 08, 2013, 8:48AM
    • It's not about ripping you off... It's to getting you back in the shops and paying more retail tax !!

      Time to find an alternative.

      Date and time
      April 08, 2013, 9:11AM
    • @eyeroll.

      They are no longer government owned, they now operate purely as a franchise.

      Western Victoria
      Date and time
      April 08, 2013, 9:28AM
    • If "Slick" Abbott gets power he will soon make sure that taxes are paid on items bought over the

      internet and consumers will still be left with high postage costs.

      J. Fraser
      Date and time
      April 08, 2013, 9:30AM
    • The real issue is why we Australian consumers pay for imported products to be shipped from the Airport or the shipping port to your front door.

      Have you ever noticed if you buy a product from New York or London with free shipping. How is that calcuated or who pays. Well the answer to that is; these are subsidized by Australians posting packages around Australia. The overseas service is free!

      Lane Cove
      Date and time
      April 08, 2013, 9:46AM
    • What is especially annoying about this move is that Australia Post frequently fails to deliver the service it charges for, I've received recorded deliveries (signature required) which were "delivered" by a contractor who simply dumps the goods on the doorstep and disappears.

      An attempt to get AP to refund the cost on the grounds they had not delivered the service I had paid for was studiously ignored.

      At least there are alternatives that are faster and were only slightly more expensive. Possibly the alternatives will now look very competitive.

      Date and time
      April 08, 2013, 9:46AM
    • Australian sellers already pay taxes when you shop online. Its only when you spend your Aussie dollars on oversea websites that you don't pay taxes.

      Date and time
      April 08, 2013, 9:48AM
    • There is a moral to this story.
      Buy as local as possible all the time so the big consolidated globalists have less power and can’t hold you over a barrel.

      This type of thing is the tip of the iceberg.
      It’s gonna get real saucy when the real KarbonTax/trading Scheme kicks in.

      Mark C
      Date and time
      April 08, 2013, 9:54AM

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