Australia Post will be investing $2 billion dollars into modernising parcel delivery, improving retail networks and launching a new digital mailbox in an attempt to future-proof the business and reap the benefits of the digital economy. 

This will be the single largest investment in the history of Australia Post and it comes on the back of the increasing popularity of online shopping, which has raised the demand for package delivery to an all-time high.

Last year, local consumers spent a total of $11.9bn in online retail sales, causing Australia Post to consistently operate at peak levels over the twelve months, rather than just during holiday periods. This in turn put increasing pressure on both delivery operations and retail stores themselves, creating a demand that the company struggled to meet.

While the increasing preference to shop online did see Australia Post bring in a profit of $546m from their unregistered sector of parcel post and express deliveries last year, the company has said they need to digitise their current operations if they want to remain relevant and the “cornerstone of the community”.

What will be done?

The $2bn investment will be split across three different areas of operations – communications, retail outlets and parcel capabilities. 

  • $350m will be dedicated towards creating and distributing the upcoming digital mailbox, which will allow consumers to receive all correspondence from businesses and government via a free, secure, online mailbox
  • $450m will go towards improving current retail outlets, building more Australia Post superstores and increasing the amount of parcel lockers available to the public
  • And, the final $1.2bn will be invested in modernising parcel capabilities, in the hopes that by 2020 Australia Post will double its parcel capacity.  

Going forward

Managing director and CEO of Australia Post, Ahmed Fahour, says this investment is a necessary step towards delivering the services that Australian’s want, need and can afford in the future: 

We recognise that the demand for physical mail services will continue to decrease and while our parcels business is growing, increased competition and the fixed costs associated with maintaining our national mail network will challenge our ability to continue to grow and invest in the future. 

Over the next four years, this investment will ensure that Australian consumers and businesses have real choice and convenience in parcel delivery, thanks to improved automation and tracking technology. Continued investment in 24/7 parcel lockers and retail superstores will also mean that by 2014, 80% of Australians in metropolitan areas will be within 10 minutes drive of an after-hours parcel collection location.

This commitment to improving services will begin in the next couple of months, with significant changes being put in place to ensure the needs of customers are met over Christmas.  

Not only will Australia Post be doing Saturday deliveries to households during November and December, they will also be extending retail hours at more than 450 retail outlets to allow for additional parcel collection. 

The end of this month will also see the release of Australia Post’s Digital Mailbox, which will allow consumers to be securely receive mail, pay bills and store important documents. It is expected that this mailbox will evolve into becoming an integral part of everyday life, much like traditional mailbox is.

But, given the recent string of security breaches, will it take off as planned?