Quote:
Originally Posted by Ric
Blimey, when did postal costs to overseas go up?
....
I'm going to stop having these Rip Van Winkle moments.  |
Seasons Greetings Ric,
You would be well excused for missing it. They went up twice this year alone.
First in April, which was relatively well publicized. This also included service and
postal charge changes for domestic post.
And then again, arguably less well publicized, on 7th October which affected only
"Registered Post and selected domestic and international products and services".
Because we ship to destinations around the world, I am in the post office daily.
On those sojourns rarely does anything escape my attention.
But even I was caught short with the international price increases on 7th October
and this was from a guy that even authored a piece of software that we use to
compute shipping prices which fetches pricing data via the Australia Post API.
The background of the story behind why our internal post charges are so high
is even more interesting.
Back in 2011, there was a Productivity Commission Inquiry into the performance
of the retail industry.
One of the submissions made was by Australia Post, which was telling.
Interested readers can find it here -
http://www.pc.gov.au/__data/assets/p...847/sub120.pdf
As letters and parcels flow around the world from country to country, the
payment arrangements between countries is complex.
These arrangements are governed by treaties between the Universal Post Union
(UPU) member countries.
When one goes back in time to the early days of the Colony, the arrangements were
somewhat simpler. For example, when someone in England wrote a letter to say
a relative in Ballarat, Australia, Royal Mail would put into the Royal coffers the
entire profit of the postage stamp affixed. This was despite the fact that when
the ship arrived in Melbourne that a Cobb & Co coach may well have transported it
to Ballarat and the local Ballarat postman would deliver it in the heat of a summer's
day on his bicycle.
This arrangement at first glance may not have seemed fair. For example, who
was to pay for the watering of the stagecoach horses or the Ballarat postie?
However the theory went in those days that if a relative in England wrote you a
letter, chances are you would write one back in response. In which case, the
profit from the postage stamp affixed would remain in the Colony.
But the world became a more complex place. Some countries were poorer than
others and as letters and trade begun to flourish around the world, this could
result in a net imbalance in the total tonnage of mail going into and out of
some countries.
The members of the UPU got together and devised a set of treaties where countries
would exchange payments between each other in the handling of post based on
their respective import and export tonnages to each other.
Some countries were given more favorable rates, that is subsidized, as they were
deemed to be developing.
As Australia Post wrote in their Production Commission submission -
Quote:
|
Originally Posted by Australia Post
The UPU’s payments arrangements are complex, subject to price floors and caps, and do not
properly reflect the true processing costs of many destination postal administrations, including
Australia Post. Under the UPU’s payment arrangements, Australia Post gets paid the same
amount for the processing of inbound international mail irrespective of its actual costs of
delivery. As a result, the pricing of international parcels destined for Australia by origin postal
administrations may be lower than it should actually be if properly costed and based on sound
commercial practice.
|
They then went onto say -
Quote:
|
Originally Posted by Australia Post
In the case of Australia Post, the payments it receives under the UPU’s terminal dues system
(being the payment from other postal administrations for the processing of inbound international
mail (including small parcels) up to 2 kilograms) is well below the cost of delivery within
Australia. Being a net importer, this means that Australia Post incurs a substantial loss on the
processing of such mail. For example, in the financial years 2010-2012, Australia Post estimates
that it will make a loss of A$1.06 per inbound international airmail packet (parcels less than 2
kilograms) on a volume of approximately 39.7 million articles.
|
Now in the financial year 2012/2013 Australia Post posted an after tax profit
of $312 million.
This is despite the fact that they stated to the Commission they were losing A$1.06
per inbound package with a weight less than 2kg.
So obviously other parts of the Australia Post postal division are subsidizing at least
some of the parcels coming into the country. One could speculate that whenever
Australian individuals or businesses are shipping overseas they are unfairly
subsidizing many of the parcels that are being imported into the country.
In their submission, Australia Post stated that -
Quote:
|
Originally Posted by Australia Post - My bolding
Australia Post is not privy to the basis on which parcel rates are determined by overseas retailers,
postal administrations or other carriers. It is therefore unknown whether subsidies are involved or
whether there is a longer term strategy by these players to provide parcel services at a loss in
order to grow market share. In these circumstances any conclusions drawn when comparing
parcel rates in different countries is more than likely to be inconclusive.
|
I bolded a key sentence above and I can provide some personal anecdotes of
which I will provide one example.
This year I wanted to buy a single coaxial connector for a piece of test equipment.
I found I could order one online out of the city of Shenzen in China for a total
price of 2.99 including "free airmail postage".
The weight of the item was 0.049kg and due to it being just shy of than 2cm thick would have
been deemed here by Australia Post as to what they technically call a "large letter".
The equivalent Airmail rate for posting the package in the reverse direction, that
is Australia to China. would have been AUD1.85.
The package was delivered to my letter box by the local Australia Post postman
riding his motorbike. It has passed through Australian Customs, Quarantine,
sorted at depots here and moved across Sydney on one or more postal trucks.
Yet the China Post franking machine imprint was for a total of Y0.00.
If this had been a one off anomaly, I would have dismissed it but I have
received other packages for small items out of China again franked Y0.00.
A scanned image of the postal frank and Customs Declaration appears below.
I enjoy my daily visit to my local post office. We interact on a first name
basis and during my stay whilst the parcels are being processed we will
often chat about the weather, the news or personal family anecdotes.
Not so long ago, I showed some of the Chinese padded envelopes to my post
master and pointing to the Y0.00 postage on them, smiled and asked "Could you
do the same for me?".
To call for such a favour, we both concluded we would probably need friends
higher up the ladder. The friendly co-operation of the general manager of
Australia Post perhaps, or the Minister responsible or the entire Australian
Government itself.
It certainly would require more influence than a smile and an exchange of a few
pleasantries for the favour.
So how is it possible that the Chinese can do it?
is it through the miracle of the Chinese industrial boom and the wonders of cheap
labour?
Or does it require what might euphemistically be called "a subsidy" but is
in fact nothing but more than dumping?
What Australia Post referred to when they wrote -
"It is therefore unknown whether subsidies are involved or whether there is a longer
term strategy by these players to provide parcel services at a loss in order to
grow market share."
Those who subscribe to Commie conspiracies might suspect that the Chinese
government is assisting with the dumping of Chinese goods to ensure that the
West never thinks about manufacturing anything ever again. Paradoxically enough,
those who subscribe to Capitalist conspiracies when presented with the same evidence
might suspect exactly the same.
There might be other conspiracy theorists who maintain the imbalance for
postal charges is to simply help pay for the Australia Post CEO's salary
which has been published as being $4.8 million per year. Not bad for an
organization that being over 200 years old that he never founded, never grew
in most of that time, which belongs to all Australians and I suspect nearly most
people have an opinion on how to run it better and many possibly could at
a fraction of that renumeration.
So there is a little more in the above to Ric's simple question about "when did
the international postal rates go up" but it is fascinating what you uncover
when you start pulling at that thread as to why.
Best regards
Gary Kopff
Mt Kuring-Gai NSW 2080
with a pay by date of 11 December (yet another late fee to contend with!
). Anything coming from the East is taking nearly 1.5 to 2 weeks at the moment.
