Rising Parcel Delivery Costs Hit Small Business

Small business operators have raised concerns with the Australian Small Business and Family Enterprise Ombudsman regarding the cost of sending parcels.

This has considerable relevance for salon, spas and clinics that offer retail replacement to their customers (eg. skincare products) and also gift and lifestyle lines on their website.

It appears that Australia Post provides volume discounts to big customers who send large amounts of parcel mail.

Ombudsman Kate Carnell is considering options to level the playing field for small businesses.

“Concerns have been raised with me by small business operators regarding their capacity to compete with big business when it comes to online sales,” Ms Carnell said.

“One of the biggest barriers that small businesses face online is the cost of sending parcels.

“In one example, a music shop in regional South Australia was quoted $75 to send a small guitar to a post office in North Queensland, while a big business competitor was able to offer free postage.

“I am examining options to level the playing field for small business to compete fairly with big business when it comes to sending goods within Australia. One option may be to establish a buying collective.

“In many cases, the online presence of a small business enables a physical store to remain open in suburbs and regional towns where it might otherwise not be viable.

“A physical store contributes to council rates, vibrancy and economic activity, which are all vital to the sustainability of local communities.”