Challenges at Australia post
The purpose of this report is to explain the overview of the Australia Post and the position of Australia post in today’s market. Australia Post is one of the top most organisation in Australia which delivers letters and parcels to the people. In this report, analysis of various strategies for the benefits of Australia Post has been mentioned. The main purpose of this report is to compare the Australia Post with all their competitors and the position of Australia post amongst their Competitors has also been mentioned in this report. The importance of this report is that it highlighted the various factors which affects the Australia Post and also provides the clarification to overcome those factors in order to become more successful in the future. Key outcome of this report is the explanation of various strength of Australia Post and also a number of opportunities which has been provided to the Australia post in order to expand their business globally.
In this report, an explanation about the company “Australia Post” which is established in 1809 in New South Wales has been made. Australia post delivers letters and telegrams and in 1838, they have started the service from Melbourne to Sydney. This report has explained the importance of letters and parcels in the early period where there were no mobile phones, social sites, emails, and messengers. People use to send messages through letters and parcels and the difficulties postman have to face while delivering the letters have also been explained in this report. It has also explained the challenges which Australian post have to face in today’s era and what changes they have to implement in order to expand their business. This report has highlighted the main competitors of Australian Post and the techniques which Australian Post can use to establish their name in E-commerce.
Brief Description of the Organisation
Australia post was established in 1809 in order to deliver letters and telegrams from one place to another. In 1820, they have started to deliver the services from one city to another city and John Bourke was given the responsibility to deliver those letters from Sydney to Melbourne. Australia post has the highest post offices in 2008 as they provide reliable, affordable and accessible letter services. They have a tendency to deliver all the letters on time and deliver approx. 60 million letters per weak which were the highest in the country. But after the arrival of technology and various electronic devices and applications like mobile phones, electronic mail, various social sites and sites (Brooks and Schellinck, 2013). As a result, there was a drastic decrement in the growth of the company and only 1 percent of texts have been delivering by post now and 97 percent of those messages are related to government and business emails. There are various external factors which are affecting the growth of the company which are as follows
Use of technology had affected the growth of the company, people prefer electronic mails and social sites to send and receive messages which resulted in the downfall of the company.
Other issues are the tough competition given by the FedEx which is the globally active courier organization.
Macro Environmental Analysis
Various macro environment factors that contributed to Australia post-performance are as follows (Andrews and Entwistle, 2014)
There is no political uncertainty issues on the Australia post as this organization is government business enterprise.
There is a slow economic growth for the company as the company is affecting by a number of factors and the main factor is the decrease in demand for delivering mails to the public. As compared to the early days, delivery of letters has fallen in a huge number which is approx. 1 billion. Exchange rates and inflation also have a huge impact on Australia post as their profits have been decreases due to travel cards and international money transfer. The confidence of consumers in Australia post have also decreased because of the slower rate of delivering the letters and consumers have to pay more in order to deliver the mail on the priority. As a result, it affects the financial position of Australia post.
In today’s world where the lifestyle of people has changed in a drastic manner which forced Australia post to bring changes in their working style and provide e-commerce services in order to stay in the market. Australia post main strategy is to establish a partnership with Australia’s e-commerce market so that they can increase Australia’s whole retail export market. By establishing a partnership with Shippit, Australia’s post will be able to provide fast parcel delivery to the public of Australia.
Technological factors- Development of new technologies have affected the profit of the company and with the preference of using electronic mails and billing has decreased the number of consumers of the Australia post (Brooks and Schellinck, 2013). With the increase in the use of online communication and the use of email for billing purpose force the Australia post to update their products and services. They are doing this by introducing a new product in the market which is known as MyPost Digital Mailbox. This technique can be used to provide a digital service in order to pay and receive bills and also it will store them with a lot of security of the taxation process in the future. Australia post is changing their work style and bring lots of technologies in their work in order to give tough competition to its competitors.
Necessities to provide mails number of times and also to keep 4000 post offices open is affecting the profits of the association. Supply and Demand for these services are quite low and due to which it affects the company’s financial position.
For the protection of the environment and to follow the environmental regulations, there is a decrement in the amount of paper bills and also in the letters. As a result, it has damaged the purpose of Australia post for sorting and delivery of emails to the public of Australia.
Australia post has domination in most part of its domestic business but still, it is significantly affected by the broader community in Australia and also in overseas because of their major trends in transporting goods and services (King and Clarkson, 2015). The advantage of using this analysis is to form a strategic analysis of the industry.
The threat of New Entrants-
Due to its previous image and nature of delivering the letters in Australia, there is less possibility of new entrants in this business. The major competition for Australia post is all the major corporations having wider customer face to face network which contains insurance companies and banks. Australia Post has a bigger image in this market whose biggest threat would be the entrance of major international corporations.
Bargaining power of Buyers-
Price settlement of postal delivery is set by the government department in order to take the input from the Productivity Commission. It has also been analysed that it also affects the commercial buyers which sum up as 80 percent of all the letters posted in Australia (Grimmer and Bingham, 2013). Logistics and Parcel Buyers have enormous power as they have the option to choose from other international organizations such as DHL and Federal Express
Bargaining power of Suppliers-
Australia post’s suppliers do not have great bargaining power as they do not have access to Australia post network.
The threat of additional services-
The main threat of substitute products would be online communication which has been done regarding personal information and business correspondence. Nowadays, payment of bills and delivery of insurance and financial utilities can be done online.
The rivalry between Existing Competitors-
The main competition of Australia Post is in Parcel and Logistics unit. Australia post has to develop State Warehousing and Distribution Services (SWAD) in order to give tough competition to its existing competitors. This will give the Australia post a surviving customer base from SWAD’s clients. Australia post has also introduced Strategic alliances in order to cover logistics deficiencies.
For identifying the resources of the Australia post, VRIO analysis has been done. With the help of VRIO analysis, evaluation and dimension of the Australia Post and their opponents has been mention. According to which, Key dates and data sources is the key resources of Australia post which is update daily through modification from postal delivery staff. This resources is quite valuable and it is very difficult to purchase this resource from the market. This resource is quite limited and only few organizations is using these resources. Australia post is using this resources in order to have a close look on their services and the amount of delivery they are doing in a day. This resource has proved to be quite beneficial for the organization like Australia post and it put them a step ahead against their competitors in the market.
SWOT Analysis of Australia Post
For identifying the strength and weakness of the industry, adoption of SWOT analysis has been made.
Most important strength of Australia post is their dominance in the delivery of letters in the domestic market and also they have a strong bond with the public of Australia (Culley, et. al., 2017). Australia post has established a strong connection in the Asia Pacific region in order to provide them an integrated logistics solution. Their partnership with China post has also helped the Australia post in becoming famous in a country like China where they supply parcels directly from Australia to China (Wang, 2016). Australia post is known to be the third largest importer of goods and services in Australia.
Australia post uses legislative responsibility in order to provide services of letters and parcels which may cost them in the future. In order to provide Agency services, Australia post has overstretched themselves. Overstretching themselves proved to be the biggest weakness of Australia Post.
If Australia post uses Agency services in an appropriate manner then it will provide them many opportunities but this step can be risky as well. UBS Consultancy has examined that customers do not want to leave their existing companies (Crew and Brennan, 2016). By expanding their business and provide car insurance can turn out to be an opportunity and with the help of that, they can counter bill payments, international money transfer, and banking.
The most important threat for Australia post is the excess use of technology and use of social sites and electronic mails. Due to which fewer people want to deliver mail with the help of letters and parcels (Cruz-Ros, and Gonzalez-Cruz, 2015). This proves to be the biggest trend in the international market in recent years. Australia post feels that increase in the rate of delivering letters and parcels which may result in putting the use of letters and parcels out of the market. Another threat for the Australia post would be the formation of an end to end logistics market which is offered by Post Logistics.
Challenges and Changes-
The biggest challenge for Australia post is excess use of electronic mails which delivers emails instantly and the courier company which charges a little amount in order to deliver mils directly to the customers. Australia Post must endorse their delivery standard in order to compete in the market.
To evaluate the business strategies of the association, they are using four types of business strategies in order to increase the growth of the business (Schaltegger, et. al., 2017). These strategies are as follows:
Market penetration- It is a strategy in which marketers sell its products offering wide-ranging of general goods and services in the existing market.
It is a strategy in which marketers sell their existing goods and services in the newly developing market.
It is a process in which a company offers new goods and services in the existing market.
It is a business strategy in which a company offers its new products, goods, and services in the newly developing market.
Australia post is using diversification business strategy in order to increase the growth of their company and according to this strategy, they are providing new goods and services in the newly developing market. They are improving their efficiency by dealing with money and insurance, parcels and emails, travel and business solutions. They are offering various products and services in order to improve the satisfaction level of the customers.
Recommendation and future of the Australia post
Australia post should examine their letter services and improve the efficiency of the services using business strategies in order to compete in the market in the future. Australia post should improve their monitoring techniques so that they can be able to observe performance against the appropriate standards. They should evaluate the method to finance the delivery of community service responsibility (Kaveke and Gachunga, 2013). They should evaluate the policy agenda in order to provide access to the communications infrastructure. They should implement new techniques to make their services cheaper as compare to their competitors. This step will bring more efficiency in the organization and it will result in improving the growth of the company.
From the above report, it can be concluded that all over the situation of Australia Post is better in the market. By examine the PESTAL analysis, it can be concluded that macro environmental factors are upsetting the working of Australia post. By examining the portal-five force model, it can be concluded that power of suppliers and buyers is low because of the tough competition in the market and threat of new entrants is also low because of various risks and huge investment in the business. It can be concluded that Australia post is using diversification as a new business strategy in order to enhance their services in other countries.
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