Australian Newsagency Blog

A blog on issues affecting Australia's newsagents, media and small business generally.

The Australia Post c-store?

Mark Fletcher
August 31st, 2010 · 15 Comments

I have heard from a couple of people that government owned Australia Post outlets, as opposed to privately owned Licenced Post Offices, are introducing selected confectionery and convenience lines to their business.  If these reports are true, I would ask on what basis can Australia Post further move into areaswell served by private enterprise, newsagents especailly.

Paragraphs 14 through 16 of Division 1 or Part 2 of the Australian Postal Corporation Act 1989 document the functions of The Australian Postal Corporation, better known as Australia Post:

14 Functions – the principal function
The principal function of Australia Post is to supply postal services
within Australia and between Australia and places outside Australia.

15 Functions – subsidiary function
A subsidiary function of Australia Post is to carry on, outside Australia, any business or activity relating to postal services.

16 Functions – incidental businesses and activities
(1) The functions of Australia Post include the carrying on, within or
outside Australia, of any business or activity that is incidental to:
(a) the supplying of postal services under section 14; or
(b) the carrying on of any business or activity under section 15.
(2) Without limiting subsection (1), the functions of Australia Post
include the carrying on, within or outside Australia, of any
business or activity that is capable of being conveniently carried
on:
(a) by the use of resources that are not immediately required in
carrying out Australia Post’s principal or subsidiary function;
or
(b) in the course of:
(i) supplying postal services under section 14; or
(ii) carrying on any business or activity under section 15.

I am curious how the possible move into confectionery and Australia Post’s aggressive move into the retailing of office products, greeting cards, telco recharge, Western Union money transfer and bill payment fits into the functions provided for under the Act. The only means I can see is if they are using resources “not immediately required in carrying out Australia Post’s principal or subsidiary function”.

This is a Corporation created by the Government to regulate the manufacture, distribution and retail of postal services. Around 80% of what is on the shop fllor of a government owned Australia Post soft is not incidental to the provision of postal services.

I would like to see politicians look at the revenue Australia Post is taking from family run businesses like newsagencies as a policy issue.

In writing about Australia Post I run the risk of alienating the many newsagents who operate Licenced Post Offices. I have no quarrel with them since they run broader businesses of which their Post Office counter is part. No, my quarrel is with the politicians who have turned a blind eye to the expansion of products and services offered through the Australia Post corporate stores.

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Category: Australia Post · Newsagency challenges

15 responses so far ↓

  • 1 Luke // Aug 31, 2010 at 9:36 AM

    We have tried to get smiggle stationery in our store and have been told that they only offer wholesale to Aust post stores exclusive. Good to see competition at play here.

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  • 2 SS // Aug 31, 2010 at 11:42 AM

    Luke try Spencil. Its exactly the same stuff as Smiggle & they are keen as to get into newsagents.

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  • 3 Luke // Aug 31, 2010 at 12:01 PM

    Thanks for that SS, I’ll have a look, kids are crazy about the colours.

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  • 4 Mark // Aug 31, 2010 at 9:29 PM

    Hmm, the lack of response suggests newsagents have no fight in them re Aussie Post government owned stores extending more into what we sell.

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  • 5 Brett // Aug 31, 2010 at 11:34 PM

    Not true Mark, I, like you, have received the Government’s letter back in the mail, ‘thanks for the letter re AP, we will change nothing’. I think that attacking the Govt’s cash cow will get nowhere, we have to think of a better way. ACCC?

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  • 6 Jarryd Moore // Sep 1, 2010 at 5:27 AM

    Brett,

    Attacking Aus Post through government is unfortunatly the only option. The ACCCs powers only extend to that which they are perscribed by the government. The legislation governing Aus Post was written, as so much legislation is, with vague intention. The only way to reduce the non-postal commercial ativities of Aus Post is to change the legislation.

    Newsagents, whilst they may have a voice in their local community, have little change of being heard by the federal parliament at present. However there may exist a few opportunities in the near futue. The independants that will hold the balance of power in the House of Reps may take up an issue such as this, especially given their rural electoral base. Some of the proposed changes to parliament that are floating around include greater ability for back-benchers to persue issues. Thats a lot a MPs which could potentilly help push the matter at the top end of government. There is also the media option where newsagents could play the local-mum-and-dad-community-based business card and push their adgenda through traditional media and at store level. Something like this might grab some mainstream media attention if a business celebrity such as Dick Smith or Gerry Harvey got behind it (I mention those two because both have interests in business where they compete with Aus Post).

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  • 7 Mark // Sep 1, 2010 at 6:00 AM

    When I was on the ANF Board in 2004 I met with the Minister for Small Business (two of them actually), The Minister for Communications (and responsible for Australia Post), the Prime Minister and several MPs to discuss Australia Post.

    I also have written at least ten letters to government between 2005 and 2009 on Australia Post.

    Yes, they all come back with the same response.

    I don’t see the ACCC as resolving this as they are a servant of regulations, as they should be.

    We need to fight this issue with the politicians at all levels. The new mix in parliament puts pressure on newsagents in the electorates of the independents to get the newsagent voice heard.

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  • 8 Luke // Sep 1, 2010 at 7:25 AM

    Complaining to the Govt about it’s own monopoly is like pissing into the wind, the only person to be effected is you.

    I see what Aust Post is doing as their attempt to get as much $$$ as they can when they eventually sell it off as they have done to almost all of the other Govt assets. They need it to look profitable so they can sucker someone into paying for it and then they will use the funds to pay for pollie and public servent pensions that they have no cash for.
    The ACCC not give a stuff, the minister for small business cannot see any votes in it for him so he will do bugger all and the other pollies will only look after themselves, and the ANF are a toothless tiger that sits on their hands while it all happens.
    It’s not that newsagents have no fight, it’s just you need to pick your battles and for me my fights are closer to home ie my own suppliers.

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  • 9 Jim // Sep 1, 2010 at 5:15 PM

    Mark,

    Like you and others, I am sick to death of Aust Post’s continuing encroachment on small business but rather than a lack of fight perhaps it is more a case of being sick & tired of talking to and emailing my local member for an absolutely zero response or result. When the local federal (Lib) member holds the seat by an almost record margin the plight of small business obviously does not sit on her agenda.
    Like Luke says, why waste resources on something you can’t win when there are other (winnable)battles to be fought. Couple this with the extremely high levels of inactivity on the part of all those useless individuals involved in the “running” of our various associations and you have the answer.

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  • 10 Luke // Sep 2, 2010 at 7:35 AM

    Well put Jim, instead of complaining about what others are “stealing” from us I have been actively out and about over the past 18 months looking at what other retailers are doing well that I can bring to my business.
    We have tried a number of new departments and some have taken off and some have been a costly mistake. But we are in the fight and trying new things not just sitting on our bums and hoping.
    AP cannot compete with us for traffic, service or even opening hours so I say move on and move into blue ocean areas and leave them to play catch up ( sorry for the airy fairy term but I liked it when I read the book).

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  • 11 Paul S // Sep 2, 2010 at 10:41 AM

    Luke, not sure what AP is like in your area (as it may be a regional or demographic issue) but in regards to traffic I’d be surprised if it wasn’t on par or greater than the newsagency.

    The AP side of my business often has the equivalent or higher traffic levels to the news side and I’m currently running very few AP lines. The billpay and banking services alone draw quite a good level of traffic. The issue for me is trying to convert a higher percentage of the traffic to newsagency sales as well.

    I’m only new to the industry (took over the business 3 months ago) but I look at other businesses that share similar or complimentary lines to what we already have and wonder how I could do it better or more efficiently with a tie in to the existing businesses.

    Cheers,

    Paul

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  • 12 Andy // Sep 2, 2010 at 1:30 PM

    Just a normal everyday customer here. FWIW i never buy anything from the post office that isn’t post-related. They can offer all the chocolates and sweets they like, I ain’t buying them. Same goes for stationery, computer goods, greeting cards, etc. Will never buy them from an Australia Post office.

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  • 13 MAX // Sep 2, 2010 at 5:09 PM

    Andy,

    Thanks for your support

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  • 14 Luke // Sep 2, 2010 at 5:21 PM

    Hi Paul S, great to hear your LPO is going well, but re read the last paragraph of the original post it is not LPO’s that are the issue it’s the Govt run and backed corporate stores that is at the heart of this blog, and not the mixed businesses that have the same limitations as the rest of the real world.
    The LPO’s in our city have the same low opinion of the main post office as I do and make good money from all the unhappy customers that refuse to use it. But these LPO do not share the same protection as the Govt owned stores and they do not have the same buying power or corporate help as you already know.

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  • 15 Peter S // Oct 16, 2010 at 8:17 AM

    Interesting story http://www.smh.com.au/business/job-cuts-flagged-as-australia-post-turns-to-retail-20101015-16njr.html

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