I was moved to write this open letter to John Stanhope, Chairman of Australia Post, after reading the article in The Australian Financial Review yesterday on page 22.
Dear John,
The feature article about you in The Australian Financial Review yesterday says that a big part of your job is persuading politicians that the rules around Post’s obligations need to be loosened – to align with a world in which “there is a younger generation, many of whom wouldn’t have written a letter, let alone post a letter.”
Really? You want the rules changed because the world has changed? You want your shareholder to protect you even more?
Hmm, let’s see how this goes – you go talk to your sole shareholder, the federal government, and ask them to change the rules to suit you, so you can pay the dividend they require. The conflict is obvious.
I am surprised you want regulatory change as that has not stopped you doing what you want in the past.
It’s a changing and unfair world John. As your organisation has though your actions in opening retail outlets close to newsagents and expanding into non post related traditional to newsagency products, taking revenue from small family businesses and leveraging your government protected brand to achieve this.
I say Australia Post has abused its protected position to compete with small business newsagents through your corporate stores. Ink, book, cards, gifts – all sorts of items being sold by the post office. I have written about this here many times.
One of my own newsagencies faced stiff competition from one of your government owned stores. We were price compared by your public servants on more than one occasion for the purpose of competition. This government owned and protected retail business was trying hard to take sales from us.
And now you say the rules need to change to protect you.
The rules should not change, not in isolation. You can’t have it both ways – protected when you want and given more flexibility when you want. If there is to be a review of the rules under which you operate your whole engagement with the act needs to be assessed and publicly debated.
But before we have that debate we need to look at your ownership. Having the government owned business competing with commercial businesses is unfair. You need to get out of retail – sell them to local newsagents at a price that accounts for the damage you have done over the years. You need to sell off your commercial courier business.
The government should only own and operate services that are not otherwise commercially viable yet which are considered an essential services for the community.
I accept you have challenges with the old print post model. They’re not new, they have been coming for ten years at least. I’d say this is why you have targeted newsagents in your corporate retail businesses over the last six to eight years. We were a soft target and you got away with taking our customers by using your monopoly.
John, what you have is a bloated retail network getting special treatment because of government ownership and taking special treatment by, in my view, operating outside the Act. It’s not a level playing field comparing the treatment of a government owned Australia Post shop and a newsagency in a shopping centre.
It frustrates me that the AFR gives you such excellent coverage when the backbone of retail in Australia, small business retailers, struggle to get issues of concern to them exposed in the media.
I hope the politicians refuse to change the rules under which you operate.
If you want to talk about this call me on 0418 321 338. I’d welcome the opportunity.
Mark Fletcher
A simple click on the like button was not enough , so well said Mark
Very good questions to be answered. It does raise a comparison with the pressure on the duopoly at this time. There has to one set of rules for all.
Yes, no more protection. If they cannot compete in an open market with competition, then close them down.
Newsagents have no protection, why should Australia Post Offices?
Mark – I would actually go much further and question whether we need Post Office at all? Govt enterprise makes sense to serve markets where there is insufficient ROI but the service/product is for the greater good. (Roads and such infrastructure come to mind.)
In an old world Post would be in that category, but certainly not in the new world.
They should sell of all SBUs and fund the NBN – which is the new piece of infrastructure that we need to reach uneconomic rural areas.
Thank you Mark. Agreed Dennis.
I would think that the idea of getting out of the Postal business and selling them to Newsagents would be a line worth pursuing. I would imagine that most Newsagents would be happy to take on the extra foot traffic. Perhaps it may not work out with the extra labour cost for the return but then a niggling unfair competitor would be eliminated whilst letters and parcels still get processed.
Another option for post is that rather than targeting our type of business where small operators are harmed, they should take the position of keeping big business honest. They are already playing in the insurance field and are ideally positioned to establish a banking business to keep the big banks honest. The government lost a lever when they sold of the Commonwealth Bank and should be back in this space rather than bullying small family owned businesses. They continually go for the easy market and hurt countless small operators with their advantages of a monopoly business.
All of these principles also apply to the ABC and their move into the digital news space. Basically it makes any attempt by commercial news organisations to create a viable digital news service extremely difficult. The ABC, with its (increasing) government support should be restricted to the “B” bit i.e. broadcasting, and in that sense providing a service that could not otherwise be provided by a commercial entity.
James I think the ABC operates within its charter. It provides an important role in our democracy.
Great letter Mark. May I print off copies for the local State Member and the Federal Member to whom I deliver papers? I am about to write them a note re Tax Packs anyway, and now I can add in the Aust Post issue as well.
Agree totally with you Mark on the role of the ABC. But just as the government backed Post Office is harming Newsagents by competing in the same space, so the publicly funded ABC is damaging commercial news businesses in their endeavours to move to a digital platform. If the ABC were limited to Radio and Television, commercial news organisations like Fairfax (which I fear is doomed) could compete on a level playing field in the digital space.
My experience of on line News, and I have sampled quite a number of different offerings, is that it is essentially a visual medium. Whilst I skim these services, I still like to read the paper to absorb the detail. Off shore experience says that broadcasters dominate on line news services and in the particular case of the UK, the public broadcaster. I believe that this is because they have cheap access to video content, not so accessible by the traditional print media, particularly independent print media.
So I dont dispute the role of the ABC, just as I dont dispute the role of the Post Office. Im just not sure that we as commercial business operators can ever compete with a government funded business operating in the same space.
Here here, well said!!! I operate in a small country town have invested a great deal revamping my greeting cards and wrap sections and now my local PO has cheap/ discounted cards and wrap front and centre. It would be nice to have a “shareholder” legislating in my best interests like they do.
And Michelle they are able to use a monopoly protected brand to drive traffic away from you.
James, as small business operators we can;t compete with the government. Big businesses, media companies, can I think.
minor typo – please replace our with ouT to make you case stronger see below.
“You need to get our of retail ”
i think you mean
“You need to get ouT of retail “
Thanks John fixed.
Am i wrong in thinking this what our Associations should be doing, lobbying Federal Members about instead of trying to sell us envelopes, copy paper etc ?
More voice in numbers!!
Just thinking allowed