Merchants demand for competitive shipping rates

Published on Mon, 26/03/2012, 08:13:23

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More competitive shipping rates are being demanded by merchants, according to the Online Business Index Shipping Report.

The report by eBay, Australia Post and PayPal found 68 per cent of respondents would like to see more competitive rates while more than half would like to see net improvements for tracking.

At the same time 55 per cent of respondents cited postage as a major barrier to growth, more pressing than cost of supplies (42 per cent) or staff wages and super costs (28 per cent)

The main driver for choosing a shipping partner for a merchant was reliability of delivery as 34 per cent listed it as their top priority, followed by cheapest rates (31 per cent) and ability to track shipments (10 per cent).

The report also looked at how well Australia Post performed against other providers and near nine out of 10 (88 per cent) respondents said they were ‘happy’ or ‘more than happy’ with the eBay-Australia Post flat rate satchel when asked. Meanwhile 16 per cent of respondents had used shipping provides other than Australia Post, including 58 per cent of business sellers for reasons including their ability to ship large or bulky items, couriers were cheaper, convenience and speed of delivery.

Despite this, 50 per cent of business sellers had contracted agreements with Australia Post. Among those contracted customers, the most frequently complaints were about flexibility of pick-up, rates, tracking and the availability of shipping for bulky items

In comparison to international performance, the domestic Australian market faces unique geographic challenges, compounded by sparsely populated rural and remote areas.

But when comparing Australia’s parcel rates and delivery times to the rest of the world, Australia Post is cheaper than the UK’s Royal Mail, but is not as quick. Australia Post offers a marginally faster service than the US Postal Service, for a higher price. FedEx, United Parcel Service (UPS) and Deutsche Post offer the fastest parcel delivery service (two days) at the most competitive rates for domestic services.

The OBI shipping report is a survey of 1,015 eBay sellers and was conducted by market researchers Stokes Mischewski in 2011.


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