Australia Post increases profit / NZ Post loses money!

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Forums › Finance and wealth management › Australia Post increases profit / NZ Post loses money!

msukiwi

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#240179 24-Aug-2018 18:15

From: https://www.news.com.au/finance/business/breaking-news/aus-post-delivers-41-profit-jump/news-story/14fd44202c19a7f92f5659f131778642

Australia Post has recorded a 41 per cent jump in full-year profit to $134 million, as continued growth of the parcel delivery unit helped offset declines in its domestic letters business.

The volume of parcels delivered was up 11 per cent, and recorded a revenue of $3.5 billion, while the volume of letters decreased by 10 per cent and its revenue was $2.4 billion.

From: https://www.stuff.co.nz/business/106532763/nz-posts-core-business-returns-to-red-as-letter-volumes-continue-to-plunge

The core postal business of state-owned NZ Post is back in the red, with a further plunge on letter volumes.

Wellington-headquartered NZ Post reported a net profit after tax of $13 million for the year to June 30, down from a $27m profit last year.

.....The drop in letters was partially offset by an increase in parcels, which rose by 7 million.

Hmmmmm......I smell fudge!

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#2078691 24-Aug-2018 18:18

20 million people and an Amazon really helps your profit margin

Common sense is not as common as you think.

mattwnz

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#2078693 24-Aug-2018 18:22

Yeah, I don' really understand why NZ post is doing so badly, considering they are also a major courier . Just look at the shareprices of some of these other courier/transport companies in NZ, they have been doing VERY well in NZ. With so many people now buying online, they should be making a killing. Sending actual letters maybe falling, but that sn;t helped by the high price it now costs.

tdgeek

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#2078715 24-Aug-2018 19:28

Without digging into the numbers, a less than 5 million population doesnt help. Economies of scale.

MichaelNZ

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#2078725 24-Aug-2018 19:53

New Zealand Post is loosing money on delivering all that stuff from Aliexpress which many New Zealanders are so enomured with.

Good bye New Zealand manufacturing and good bye a bunch of your other jobs when the Chinese work out how to do it.

You did this to yourself.

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quickymart

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#2078733 24-Aug-2018 20:12

tdgeek:

Without digging into the numbers, a less than 5 million population doesnt help. Economies of scale.

We had a lower population in the 80s and 90s and they were still quite profitable. Mind you, more mail was sent back then too - bills, letters, magazines, almost everything.

msukiwi

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#2078735 24-Aug-2018 20:14

MichaelNZ:

New Zealand Post is loosing money on delivering all that stuff from Aliexpress which many New Zealanders are so enomured with.

Good bye New Zealand manufacturing and good bye a bunch of your other jobs when the Chinese work out how to do it.

You did this to yourself.

I like a lot of others buy items from eBay / AliExpress which are NOT made in NZ, and if you want the item locally most people I know are happy to buy "local",

but in most cases the excessive markups don't make it practical.

The days of buying for $2.75 Incl GST and selling for $29.95 Incl. are over.

MichaelNZ

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#2078738 24-Aug-2018 20:17

msukiwi:

The days of buying for $2.75 Incl GST and selling for $29.95 Incl. are over.

The only way one can avoid generous margins is by employing noone or cheap labour and paying stuff all tax.

It's too expensive to run a business in NZ and set to get more expensive with increasing unemployment and higher minimum wages.

There is no free lunch buying from China.

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tdgeek

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#2078739 24-Aug-2018 20:18

quickymart:

tdgeek:

Without digging into the numbers, a less than 5 million population doesnt help. Economies of scale.

We had a lower population in the 80s and 90s and they were still quite profitable. Mind you, more mail was sent back then too - bills, letters, magazines, almost everything.

Different world now

MichaelNZ

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#2078740 24-Aug-2018 20:19

Blaming falling letter volumes is a red herring but easier to present to the average punter than to explain why their Ali-purchases are decimating margins.

Whether it is the current Labour regime or the next government, the crunch is going to come if they don't stand up to the Chinese.

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Technofreak

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#2079639 27-Aug-2018 12:03

MichaelNZ:
Blaming falling letter volumes is a red herring but easier to present to the average punter than to explain why their Ali-purchases are decimating margins.

Whether it is the current Labour regime or the next government, the crunch is going to come if they don't stand up to the Chinese.

Can explain whst you mean about standing up to the Chinese?

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frankv

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#2079659 27-Aug-2018 12:32

Under the International Postal Union agreement, each country keeps the value of postage sold in their own country. So if I buy something from AliExpress, ChinaPost keeps the postage cost, and pays for shipment out of China. NZPost incurs the cost of delivery within NZ. Given that they have only a small part of the total cost, ChinaPost discounts the shipping.

I gather that periodically there are adjustments where postal volumes are severely unbalanaced. So NZPost can ask for money from ChinaPost. But they (and presumably that also means the NZ Govt), need to stand up to China to get this money.

MichaelNZ

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#2079681 27-Aug-2018 13:16

Technofreak:
MichaelNZ:

Whether it is the current Labour regime or the next government, the crunch is going to come if they don't stand up to the Chinese.

Can explain whst you mean about standing up to the Chinese?

By placing tarrifs on their goods which they are subsidising and dumping.

New Zealand used to be a land of manufacturers. We had a lot of small businesses who would employ 1-10 people. Individually, that may not count for much, but collectively it had a lot of value for the country.

But now all those small businesses are stuffed.

What we can't manufacture domestically we should obtain from comparable economies. Cars is a good example.

Allowing things to continue the way they are will mean we are a nation of cheap goods which the populace will be increasingly unable to afford because they haven't got a job.

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networkn

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#2079686 27-Aug-2018 13:23

AU Post is still making money because the NBN Internet deployment is so poor, that it's quicker and more reliable to write a letter and have someone deliver it, than it would be to send an email.

tdgeek

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#2079688 27-Aug-2018 13:26

The citizens of this country buy the cheaper goods, they chose. Same reason when you buy T shirts in the US they are Honduran made. Americans wont buy US T shirts they cost too much.

If you wanted manufacturing here to grow, you will employ more people, but you won't sell much as the goods cost too much, so they will go out of business.

Don't think of NZ as one country, think of Earth as one entity

MichaelNZ

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#2079691 27-Aug-2018 13:30

tdgeek:

Don't think of NZ as one country, think of Earth as one entity

That's all very nice as long as you don't mind working for US$3 a day so your employer can stay competitive.

And just so it's clear - this is not a trite cliche - I have personally seen it first hand.

Most of my inlaws work for rates which are not much better.

Cheap imports are all great as long as someone is paying you first world wages... But when the Chinese and Filipinos get their act together tech wise, it's all over for you.

They will work longer hours for less pay then you could ever believe. Furthermore, they will agree to employment contracts which would be downright illegal in NZ. You have no chance. Even if you were desperate enough, your government won't allow you to sign a comparable agreement. Their governments not only allow it, they aid and abeit this in all sorts of ways you would not believe if you hadn't seen it with your own eyes.

And don't think it's just China. If anything, the Philippines - despite it's outward appearance of being Catholic, having English as an official language and no internet controls - is as bad or even worse in these stakes.

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