NZ Post putting up prices

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timmmay

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#210318 22-Mar-2017 13:20

Article here.

The cost of sending a medium-sized letter will increase from $1.80 to $2.30, a large letter from $2.80 to $3.30, and an oversize item from $3.80 to $4.30. There will also be a 2.55 per cent increase for all domestic parcel products and services for commercial accounts, including CourierPost, Pace, and ParcelPost.

Postage in NZ is already seems very expensive. It's often more expensive to ship a package around your island than it is to ship something from China or the USA.

Maybe NZPost needs a proper overhaul. Mail is eventually going to just about cease, packages will keep going up due to online shopping.

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Hammered
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#1745795 22-Mar-2017 13:35

Yes, the correct headline would read "Falling mail volumes partly attributable to stamp price increases". But in saying that, it's an archaic system that probably won't be around in its current form much longer. You'll need to pay a courier to driver a letter/document.

People often mistake me for an adult because of my age.

Keep calm, and carry on posting.

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Geektastic

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#1745796 22-Mar-2017 13:35

That seems very expensive - especially when a lot of customers are seeing reduced delivery frequency. Lower service, higher prices. Always a recipe for success...!

timmmay

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#1745799 22-Mar-2017 13:40

Mail isn't that important or urgent any more. Grandmothers use email and Skype. How about weekly deliveries? That would reduce delivery staff, and staff are often a significant cost.

I wonder if reducing stores would help. I print all my postage online but I still need to drop into stores to send packages. Because their drop boxes are so small I have to line up to go to the counter. Drop boxes could reduce the need for stores.

I guess there's also a huge legacy cost from when they handled huge volumes of mail. Time to work out how to right size the organisation and facilities.

mattwnz

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#1745801 22-Mar-2017 13:42

Death nail to the coffin IMO, as putting up prices only discourages people to send things.

sbiddle

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#1745802 22-Mar-2017 13:42

China has heavily subsidised postage and basically takes advantage of the UPU structure and terminal dues. This means the increase of packages from China is hurting NZ Post who are effectively losing revenue from local sources, yet still being expected to deliver foreign mail that they may get null (or very minimal) revenue for. The irony of shipping a package to Auckland is that you're effectively subsidising somebody's Aliexpress shopping.

NZ Post have been through some pretty significant over halls and focussed on looking at other ways of generating revenue outside their core business.

Geektastic

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#1745804 22-Mar-2017 13:43

Don't forget that there is also a big difference in use of these services between rural folk and urban folk.

In the countryside, your local post shop is often part of the community in a way that it probably isn't in a big city. The rural delivery man is also a link with the world for some folk who live in isolated places in NZ, collecting mail from their boxes as well as delivering it, because there are no mail boxes nearby etc.

MikeB4

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#1745810 22-Mar-2017 13:48

Putting up their prices is not going to save them, they need to diversify and find new revenue streams. Keeping the prices of snail mail down may actually help them in the medium term but eventually it is going to go the way of the carrier pigeon. In the long term it maybe better for the Government to sell NZ Post to one of the Freight/courier companies.

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mattwnz

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#1745838 22-Mar-2017 14:03

sbiddle:

China has heavily subsidised postage and basically takes advantage of the UPU structure and terminal dues. This means the increase of packages from China is hurting NZ Post who are effectively losing revenue from local sources, yet still being expected to deliver foreign mail that they may get null (or very minimal) revenue for. The irony of shipping a package to Auckland is that you're effectively subsidising somebody's Aliexpress shopping.

NZ Post have been through some pretty significant over halls and focussed on looking at other ways of generating revenue outside their core business.

I think that sucks, and surprised NZ post can't do something about it, such as charge a surcharge on all incoming packages from china. It is affecting NZ businesses too because they can't compete with china, who effectively offer free shipping, plus no GST, plus the lower production costs involved.

mattwnz

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#1745842 22-Mar-2017 14:05

MikeB4:

Putting up their prices is not going to save them, they need to diversify and find new revenue streams. Keeping the prices of snail mail down may actually help them in the medium term but eventually it is going to go the way of the carrier pigeon. In the long term it maybe better for the Government to sell NZ Post to one of the Freight/courier companies.

It is not helped by companies wanting to email people things such as company statement, instead of mailing them, including the IRD, who must have been one of NZ posts biggest customers. But I hate getting that sort of thing via email, because I still need to print them off, which is another step.

sbiddle

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#1745855 22-Mar-2017 14:23

mattwnz:

sbiddle:

China has heavily subsidised postage and basically takes advantage of the UPU structure and terminal dues. This means the increase of packages from China is hurting NZ Post who are effectively losing revenue from local sources, yet still being expected to deliver foreign mail that they may get null (or very minimal) revenue for. The irony of shipping a package to Auckland is that you're effectively subsidising somebody's Aliexpress shopping.

NZ Post have been through some pretty significant over halls and focussed on looking at other ways of generating revenue outside their core business.

I think that sucks, and surprised NZ post can't do something about it, such as charge a surcharge on all incoming packages from china. It is affecting NZ businesses too because they can't compete with china, who effectively offer free shipping, plus no GST, plus the lower production costs involved.

There are plenty of media articles about the system, and countries that want the way the UPU works to change.

andrewNZ

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#1745903 22-Mar-2017 15:35

My personal opinion, is that the company is attempting a shut down the service in a controlled way.

This is the only reasonable option at this point. The classic postal service cannot survive, it simply doesn't fit today's world. Winding it down is the best way to ensure the remaining market copes.

I for one look forward to the day I can remove my letterbox.

(ex employee, with no specific knowledge of the plan)

freitasm

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#1745909 22-Mar-2017 15:43

@MikeB4: Putting up their prices is not going to save them, they need to diversify and find new revenue streams.

That's a cool idea. They could come up some a bank for example and use more than half of their NZ Post shops for banking, since obviously the queues aren't a problem...

Coil

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#1745953 22-Mar-2017 16:43

freitasm:

@MikeB4: Putting up their prices is not going to save them, they need to diversify and find new revenue streams.

That's a cool idea. They could come up some a bank for example and use more than half of their NZ Post shops for banking, since obviously the queues aren't a problem...

I thought they could setup a forwarding service from offshore locations that dont ship to NZ. Might work? Who knows.. Sounds expensive.

mattwnz

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#1745978 22-Mar-2017 17:57

Isn't the postal system somewhat similar to public transport, in that it needs subsidising anyway. So either the following needs to be done to keep it going

(a) The taxpayer pays them to keep it going, so it is subsidised by the government.

(b) they put up their prices. This is a terrible idea because it means that less people will use it anyway, and makes the system a joke, considering how cheap it is overseas. It also means that at some stage hardly anyone will use it at all.

(c) They use other income streams to subsidise it, such as a bank, or courier /freight services. But they seem to be moving away from the model.

Maybe our government should be taking Chinas lead, which would allow NZ companies to compete with other countries, and export goods. At the moment the cost to export is too high, which means that many NZ companies producing goods only sell in NZ.

It also doesn't seem to be just China who has cheap international postage. I buy some things from several companies in the UK, and a largish box only costs only a few dollars in freight. If you look on trademe there are international sellers who do free fright, on relatively low cost items.

sbiddle

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#1746064 22-Mar-2017 21:20

I don't think you can actually accuse NZ Post of not preparing for the future - their real problem has been that many of the side projects and ideas they've looked at simply haven't worked. Products such as eBill that was launched in 2000 was one of their first "digital" ventures and suffered from being ahead of it's time.

Maybe they should have just launched a broadband offering and become a telco since everybody things there is so much money to be made.. :)

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