Sendle recognised for small-business focus

Sendle has received the Good Design Award for Service Design – Commercial Services at the 2017 Good Design Awards, held on 8 June at the Overseas Passenger Terminal in Sydney.
The accolade was given in recognition of Sendle’s business model which is specifically designed for small businesses.
Commenting on the win, James Chin Moody Founder and CEO, Sendle, said,
“We started Sendle to make parcel delivery for small businesses simple, reliable and affordable – and we’ve done this by focusing on good design across our software, courier network and customer support.
“The ease of account creation, intuitive interface and simple pricing is designed to help very small businesses, while powerful features and integrations satisfy larger business needs. Good design should not be overlooked in any business, and it’s given us a strong competitive edge in a market monopolised by the post office.”

AusPost partners with Qantas on supersized air-freight

Australia Post and Qantas have welcomed the largest aircraft to join the dedicated domestic air network used exclusively by Australia Post and StarTrack customers.
Bob Black, Chief Operations Officer, Australia Post Group and CEO, StarTrack, said the addition of the B737-400 was great news for Australian consumers and retailers, and further strengthened Australia Post’s delivery network.
“We’re delighted to be able to offer local businesses access to the best value delivery service in the market; a fully integrated eCommerce and logistics network in the sky and on the ground,” said Black.
“This new aircraft is the largest type of freighter aircraft operating scheduled services in Australia and gives us greater capacity and flexibility.
“We know that online shopping continues to grow because of the price, range and convenience of products available on domestic and international marketplaces.
“The main aim for us is to help Australian businesses, including those in rural and regional areas, stay strong in a competitive and global market, and this new plane sets us apart from our competitors.”
The B737-400 freighter is capable of carrying 16,500kg of cargo and is part of a dedicated network of six aircraft – all branded in StarTrack livery.
The air-freighter’s arrival is part of a five-year contract worth more than $500 million for the transport of Australia Post and StarTrack’s range of premium and express products and services until mid-2020. The agreement includes priority access to cargo space in Qantas Group’s passenger fleet.

Sendle takes on eBay exec as Head of Growth

Days after IP Australia found in its favour in a long-running Australia Post trademark dispute, parcel delivery service Sendle has reported that it has made a major new addition to support its future direction.
Apurva Chiranewala, eBay’s former Head of Shipping, will join the company as Head of Growth, as reported by Business Insider.
Chiranewala said, “This is a pivotal period of growth for both Sendle and the eCommerce industry as a whole.”
According to Sendle CEO and Co-founder James Chin Moody, Chiranewala’s knowledge and support will be instrumental in the continued expansion of Sendle’s presence in the digital economy.

Discord over Government's new GST plan

From 1 July, imported purchases worth under $1,000 will incur GST charges, though there is some disagreement in the market over who should be collecting it.
E-retailer Amazon has hit out at the government’s decision to have sellers, the electronic distribution platform or the re-deliverer – depending on the nature of the transaction – collect the fee. According to The Guardian, the company has suggested that the poor design of this ‘vendor model’ plan will result in an “inherent disincentive” to comply.
In a submission, Amazon queried why the Government ignored a recommendation made by a previous government taskforce, advising that a ‘logistics model’ – whereby Australia Post, express carriers and freight forwarders collect the GST – be used.
“Logistics providers already have infrastructure in place to collect information on goods coming into Australia and have well-established processes for GST collection for goods valued at more than $1,000,” it said in the submission.
Australia Post welcomed the vendor model chosen by the Government, asserting in its own submission that it would be the most efficient way to impose the task, and to require Australia Post to collect the tax would render its parcels business “unviable.”
The postal service voiced its support of the Turnbull government’s proposed GST plan but noted that it hopes the tax will be imposed one year later.
“Any proposal involving collection of GST under a model that requires collection at the border is likely to render Australia Post mail and parcels business unviable in the current market of continuing and significant decline in mail volumes that have put severe strain on the financial position of the corporation,” the national post service’s submission said.
It adds that the cost to the Federal Government of requiring Australia Post to collect GST – approximately $900 million – would more than cancel out the $300 million they could hope to raise with the levy.

AusPost, Alibaba fight food fraud in supply chain

Australia Post is participating in an initiative with e-commerce company Alibaba and natural health company Blackmores to combat the rise of counterfeit food being sold across China, with PwC acting as an adviser to the project.
The initiative will target the traceability of food products, reducing the risk of fraud and ensuring Australia remains a trusted exporter of high quality food, said Bob Black, CEO, StarTrack, and Executive General Manager Parcels, Australia Post. The project would help guarantee genuine products arrive safely into the hands of Chinese consumers, he added.
“We are delighted Alibaba has invited us to create an innovative platform, which will track food from paddock to plate, strengthening the supply chain,” Black said.
“The initiative will leverage our secure, reliable and fast service to support the authentication of Australian products bound for the Chinese market. Our food producers have a global reputation as being a clean, green and safe provider of food and we are pleased to help deliver a solution to enhance the integrity of their produce.”
The project will explore new technologies, including blockchain technology, to obtain crucial details from suppliers about where and how their food was grown and map its journey along the supply chain. The technology also has the potential to enable up-to-date audits, increasing transparency between producers and consumers.
“Food fraud is known to be one of the biggest issues facing the global food industry, considering the potential health risks associated with adulteration and loss of trust from consumers and governments,” Australia Post said in a statement. “In recent years counterfeiters have targeted popular Australian products such as health supplements, beer and wine, honey and cherries.”

Sendle CEO comments on AusPost court battle

New kid on the parcel delivery block Sendle has been offering Australia-wide flat rates to small businesses since 2014, though the delivery service has been embroiled in a legal dispute with Australia Post since soon after its inception.
Australia Post has asserted that Sendle’s slogon – ‘post without the office’ – infringes upon their trademark over the word ‘post’.
IP Australia is now making its determination and could take up to three months to make an adjudication.
Logistics & Materials Handling sat down with James Chin Moody, CEO at Sendle, to find out why the company has the national postal service so spooked, and how he feels about competition in the sector.
“Australia Post is going to be around for many years to come – but they are not used to friendly competition in this space,” Moody commented. “At Sendle, we think it makes industry better by improving service levels and bringing prices down – it’s great for everyone.”
Moody noted that this is not the first time Australia Post has used its might to thwart a would-be competitor. Australia Post began legal action against Digital Post Australia upon its launch in 2012, purportedly due to the company’s name infringing on Australia’s trademark, but likely due to the newcomer’s offering of a digital postbox service similar to one soon to be introduced by Australia Post. The trademark battle made it to Federal Court where it was tossed out, a fact which gives Moody added confidence. “You can’t own the word ‘post’,” he added.
When asked whether there was room for both Sendle and Australia Post in the country’s parcel delivery market, Moody pointed again to the benefits of competition. “It’s really healthier – choice is healthier for everyone,” he said. “Australia is poorer with one airline, one bank, one telco, etc. Choice helps friendly competition, prices come down and service levels improve.”
The chances of collaboration between the two delivery companies in the future are slim, Moody shared – at least while Australia Post continues to use its traditional service style. “We believe we’re offering a better level of service,” he said.
“What we’re learning in the age of the Internet, the age of technology, is that you can no longer be 80 per cent good to everybody, you have to be 100 per cent good to somebody. You can’t be 100 per cent good to 80 per cent of the market, but you can be 100 per cent good to 20 per cent of the market, and that’s what we’re trying to be.”
The tools, partnerships and customer support Sendle develops, he shared, are designed to suit small business, and give a viable alternative to those having to line up at the post office. “Sometimes, when you’re really small, none of the big guys want to talk to you,” he said. “Small businesses spend up to 40 per cent of their time on admin and logistics. Let’s free up their time so they can do what matters – building their business.”

AusPost launches electric delivery vehicle trial

Australia Post will begin trialling electric delivery vehicles on routes in Hobart from 20 March.
Five new three-wheeled e-vehicles will service Bellerive, Howrah, Montagu Bay, Mornington, Rosny Park, Tranmere and Warrane. The new e-vehicles have three times the parcel carrying capacity of the current postie motorbike and can hold up to 100 small parcels and 1,200 letters at a time. They have a top speed of 45km/h and a nine-hour battery life.
Australia Post’s Head of Network Optimisation, Mitch Buxton, said Hobart serves as a perfect starting point to get the pilot underway with locals increasingly embracing online shopping.
“We know that residents in Hobart love online shopping,” he said. “In fact the yearly growth rate in this area is above the national average, sitting at 13.8 per cent growth compared to 11.5 per cent.
“Health and beauty products, fashion and recreational goods are the most popular purchases among local Hobart residents.”
The city’s flat terrain was also reportedly a factor in its selection for the trial.
“Our parcels business generates over 70 per cent of our total revenue,” Buxton continued. “Ten years ago parcels contributed less than 25 per cent of our revenue.
“As our business transforms so too are the jobs that our workforce are doing. A few years ago we equipped our posties so they can deliver small parcels and this latest initiative will allow them to deliver even more – helping to ensure their roles remain meaningful well into the future.
“While letter volumes have nearly halved, this is another example of how Australia Post is looking at ways to keep our posties delivering for Australians.”
The pilot comes off the back of Australia Post announcing a $197 million before-tax half-year profit, driven largely by a 5.7 per cent volume growth in the parcels business and postal losses reduced to break even.
The e-vehicles are already successfully used in Germany and Switzerland, with international postal authorities seeing benefits including greater carrying capacity, improved rider safety and lower vehicle emissions.
AusPost’s Hobart trial will run for three months, and from April similar pilot projects will be launched in Victoria, NSW, Queensland, South Australia and Western Australia.

AusPost takes rival to court over alleged infringement

In the wake of the departure of Ahmed Fahour as CEO, the drama at Australia Post is not yet over.
The national delivery company has now taken rival Sendle to court, asserting ownership of the terms ‘post’ and ‘office’.
Australia Post is going after Sendle – which was founded in 2014 and offers Australia-wide flat-rate delivery charges – for trademark infringement due to the wording of its slogan, ‘post without the office’.
Sendle CEO, James Chin Moody, told The Australian, “Australia Post says customers would get confused by having post and office together in the same tag line, but consumers are a lot smarter than that.
“They’re making the case they own the word ‘post’ – they even brought out the Oxford dictionary definition at one stage.
“But I think it’s showing we’re successful. What we’re doing is creating a service that people want but also is different to everything they don’t want, which is lining up at the post office and all the inconvenience associated with that.”
Moody, a former CSIRO executive, stated that IP Australia is now making its determination and could take up to three months to make an adjudication.
“It’s been fascinating to see the amount of support we’ve received,” he added. “A lot of the community is saying ‘why are we spending money on this, as taxpayers?’ That’s a big question that needs to be asked. Our intention as Sendle – we’re trying not to pretend we’re the post office. We’re the complete opposite. In a lot of cases we’re a lot cheaper – we can do it for 40 per cent less on average.”
Moody said that Prime Minister Malcolm Turnbull’s support for competition for the marketplace did not seem to extend to Australia Post. “The Turnbull Government could start asking: do we effectively have a functional monopoly here, with Australia Post?” he said. “Until we came along, you didn’t have that much choice apart from lining up at the post office.
“There are a lot of hidden monopoly things around that you don’t see until you look under the hood. AusPost is still the only company that can deliver to PO boxes. That’s a government asset, and it’s a bit like Telstra saying you can’t call a Telstra home phone unless you have a Telstra mobile phone.
“We’ve been calling on AusPost to open up that network for the past year. For many customers in regional areas that might be your address, and you can’t participate in the e-commerce economy. The government should be looking at this, not spending money on an IP dispute.”

AusPost CEO Ahmed Fahour resigns

Australia Post has announced that Ahmed Fahour resigned as Managing Director & Group CEO today, Thursday 23 February, and will step down from the role in July 2017.
Fahour tendered his resignation at the company’s Board meeting yesterday, having served as MD and CEO of Australia Post since February 2010. His decision comes in the wake of intense criticism over his $5.6 million pay cheque in 2016 that was disclosed by Australia Post in response to a Senate committee inquiry earlier this month.
“Now, with the business entering the next phase of its transformation, Ahmed’s decision to resign provides opportunity for a new leader to continue the development of Australia Post into a leading international eCommerce player,” said John Stanhope, Chairman of the Australia Post Board.
“Ahmed was appointed at a time when Post was still highly dependent on revenue from the letters service, but the community’s use of letters had already peaked and was in the early stages of decline.
“He led the team that developed an entirely new strategy focused on investing in the parcels and eCommerce business.”
Under Fahour, Australia Post invested in its Parcels & eCommerce business, including acquiring the remaining half of StarTrack from its JV-partner Qantas; doubling the capacity of its Melbourne and Sydney parcels centres; installing 24/7 Parcel Lockers at 264 sites and partnering with Woolworths to install a further 500 sites, to make parcel collection more convenient for Australians; and investing in and forming an international eCommerce alliance with Aramex.

AusPost boss Australia’s highest paid civil servant, earns $5.6 million

Heads rolled this week when it was revealed that Ahmed Fahour, Managing Director and CEO of Australia Post, earns ten times more than the Prime Minister.
After attempting to block a request to disclose the salaries of its senior management team, claiming it would result in ‘unwarranted media attention’ and ‘brand damage’, Australia Post was directed to release the information. In past years, all such salaries were public knowledge, until in 2014/15 it was decided that the total sum be provided rather than individual pay.
Senator James Paterson, Chairman of the parliamentary committee tasked with reviewing the salaries of the Government-owned entity’s executives, revealed that Fahour received a $4.4 million salary along with a $1.2 million bonus in the last financial year, bringing his total package to $5.6 million, leaving Prime Minister Malcolm Turnball’s $522,000 pay looking paltry by comparison.
“I think that salary, that remuneration is too high,” Turnbull told reporters on Wednesday. “As someone who has spent most of his life in the business world before coming into politics, I think that’s a very big salary for that job.”
John Stanhope, Chairman at Australia Post, denied trying to cover up the information. “There’s been no intended secrecy or lack of transparency,” he told ABC‘s AM program. “When we report remuneration, we’re required to follow Government guidelines and we’ve reported it every year as required. The Senate asked a question on notice and we responded and gave them all the information.
“That number, it has his base salary, it’s got some short-term incentives which he earned because the company went from loss to profit in the ‘16 year, it also includes his superannuation. It’s everything.
“It is a Government business enterprise, that is true, but it isn’t actually taxpayer funded, it’s self-funded, so it generates profit and generates its own cash.”
Stanhope stated that 73 per cent of Australia Post’s revenue and all of its profit comes from the parcels business, where it competes against multinational firms such as DHL, FedEx and Toll.
“It’s a very competitive business and we need to pay competitive salaries,” he said.

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