Australia Post parcel pause on Father's Day weekend shows need for logistics diversification

Australia Post parcel pause on Father's Day weekend shows need for logistics diversification

While some Australian businesses were blindsided by Australia Post's decision to limit some services for three days given 500 staff are in self-isolation, for many e-commerce operators the disruption vindicates strategic decisions made to take logistics responsibility into their own hands.

Australia Post will pause Parcel Post collections in Victoria, New South Wales and the Australian Capital Territory starting tomorrow morning as it struggles to cope with record volumes

Tom Lawrence, founder and managing director of Sydney-based Swanky Socks, explains the problem has been brewing for some time.

"Many major freight carriers have been hugely disrupted as a result of COVID for a good two weeks now. Closed depots, decreased staff and the interstate strikes last week have all had a part to play," Lawrence says.

"The positive is that because of the impact we all witnessed in March 2020 where businesses, consumers and freight companies were all completely caught off-guard, this time we've seen the situation coming and have been well aware of what to expect and how to proceed with any issues.

"For Swanky Socks, we've looked to provide clear communication around this to consumers and for urgent scenarios, we've changed freight services to same-day couriers and DHL Express."

Lawrence says while it's costly, his approach is to go above and beyond to ensure customers are happy.

"With Father's Day this weekend, many consumers will be left stranded with gifts delivered the following week sadly, however the response from most of our customers has been positive and understanding towards the current situation," he says.

Lawrence's sentiments are echoed by Hannah Spilva, co-founder and CEO of Melbourne-based flower and gift delivery business LVLY. Her company manages the logistics of around 80 per cent of its own same-day deliveries across Melbourne, Sydney, Brisbane and Adelaide.

"I think whilst it’s certainly going to cause chaos for lots of retailers sadly, we're in a very fortunate position where we manage logistics ourselves," Spilva says.

"There's already a very high high volume of online purchases being made across the country in every category, but particularly with an event like Father's Day you'd expect to see a spike, so there will definitely be retailers and customers that are adversely affected.

"There’s a national next-day service and we do we do partner with StarTrack on that, but the StarTrack service is unaffected."

Express Post, Premium and letters also remain unchanged across the network, according to Australia Post.

Phillip Kuoch, creative director and founder of Melbourne-based doughnut delivery group Goldelucks, says his company is an Australia Post customer but will not be affected by the pause as it too leans towards the StarTrack services.

"We decided to use StarTrack since the start the pandemic to get our orders out to customers typically overnight to metro suburbs and this has been mostly unaffected by restrictions," Kuoch says.

"However, this has meant that we are paying more when usually if we were able to use the typical Australia Post services."

Anna Podolsky, founder and CEO of direct-to-consumer delivery business Lyka Pet Food in Sydney, highlights the enormous strain Australia Post has been under, particularly given the recent explosion of online shopping.

"With Lyka being a solely e-commerce business, and one that always needs to deliver on time due to the nature of our perishable products, we recognised the need to diversify two years ago and opted for a more specialised and reliable service.

"The issue currently facing Australia Post reinforces the need for more diversification in the delivery sector, to ensure that all Australian businesses can deliver as promised and continuously work towards maintaining levels of service, even through lockdowns."

For many businesses though, the halt on certain services will be much more damaging, particularly for those in rural areas.

"It is catastrophic as we have been working around the clock to ensure all our Father’s Day orders will be there on time only to be let down by Australia Post," says Rhiannon Druce, general manager of Junee Licorice and Chocolate Factory near Wagga Wagga.

"We spent $58,000 in the past month with Australia Post to ensure our customers receive their deliveries on time and we fear there will be a lot of fathers left disappointed.

"This will impact our business in the long term as customers who don’t receive their gifts on time will be left disappointed and we will be to blame when it is Australia Post who hasn’t delivered on their promise."

Druce says postal options are limited due to the company's regional location.

"Australia Post has told us if we pay additional monies for express post as well as pay for a third party courier we can then have parcel pick up on Monday which we are paying for as we refuse to pass this extra cost on customers," Druce says.

"We are already battling COVID and lockdowns and now Australia Post is letting us down."

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