Australian Newsagency Blog

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Is the new Australia Post ship direct to China shop a breach of competitive neutrality?

Mark Fletcher
May 28th, 2018 · 7 Comments

Australia Post has opened a shop in Chatswood NSW where shoppers can select items for direct to China shipment. The store is aimed at Chinese personal shoppers, providing them an easy ship service that other Australian retailers struggle to achieve thanks to Australia Post inefficiencies for online retailers.

This is where I wonder if Australia Post is breaching competitive neutrality obligations it has as a government owned business. It appears to be giving its own business benefits that it does not give other retailers chasing online sales.

From Treasury:

Competitive neutrality requires that government business activities should not enjoy any net competitive advantages simply by virtue of public sector ownership. This allows market competition to drive the efficient production of goods and services by the lowest cost business.

This latest Australia Post, like so many in their corporate stores, leverages their government ownership and protection for competitive advantage.

The other issue here is the direct to China route opened for selling baby formula, product that can be challenging for Australian families to buy from Australian supermarkets. This is another aspect of this new Australia Post business that warrants discussion.

I am grateful to a regular visitor to this blog who pointed me to the story. Their concern related to the milk issue and the evolution of Australia Post – that baby formula is in short supply in particular.

Australia Post is straying further from its charter, leveraging its government ownership and protection to compete with commercial businesses.

The federal government listens to the Murdoch family when they complain about government owned ABC  commercial enterprises harming their commercial interests, why do they not listed when small business newsagents and other retailers complain about how the government owned Australia Post leverages its protection and government ownership to hurt them? Because small business only matters at election time.

21 likes

Category: Australia Post · Competition · Social responsibility

7 responses so far ↓

  • 1 er // May 28, 2018 at 8:34 AM

    get even with Austpost. using 4PX to direct shipment to China and lower cost

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  • 2 Colin // May 28, 2018 at 9:37 AM

    The real issue with post office is cross subsidies. The retail and postal delivery arms should each be required to make a financial return. I doubt this shop would be cost effective if it had to pay the post office for the true cost of delivery.

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  • 3 Jane Grenfell // Apr 21, 2020 at 10:58 AM

    I have wondered for a long time why the majority of Australia Post offices are managed by Chinese operators.
    Many have only a rudimentary grasp of the English language and regarding the horrific amounts of Australian baby formulas that leave our shores for China one would have to assume the people working in the post office are aware of this problem, and are helping to arrange these formulas to make the trip to China.
    Does the Australian Govt who owns Australia Post intend to clamp down on this awful practice, and even more, will it be investigating the Chinese employees aiding and abetting the people making so much money from depriving our children of their much needed formulas?

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  • 4 Lance // Apr 21, 2020 at 12:51 PM

    Probably not a majority of Chinese LPO operators, but yes, a good percentage.
    Lots from the sub-Continent as well as some Aussies 😉

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  • 5 Graeme Day // Apr 21, 2020 at 1:51 PM

    Hi Jane , the latest count is Sub Continent majority, Asia next, then the rest Aussie, and European, middle Eastern etc.
    aust. Post are getting more particualr in screening by competancy, english speaking and computer skills.

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  • 6 Lance // Apr 21, 2020 at 4:04 PM

    “”””Post are getting more particualr in screening by competancy, english speaking and computer skills.””””

    …and then ignoring all of the above… 🙂

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  • 7 Graeme Day // Apr 21, 2020 at 5:20 PM

    I am unofficially informed this is a process that allows them to diasallow the transfer of the business without giving any reasons whatsover.
    Obviously thay cannot do this on discrimination …however the test are difficult if you understand.
    I have had recent busines dealings within in this area of concern.
    They are acutely aware of the LPO mix

    0 likes

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