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Australia’s complex parcel delivery fee in the spotlight

Australia's complex parcel delivery fee in the spotlight

Delivering products across Australia presents unique challenges due to the country’s vast size and varying population density. Unlike densely populated regions in other countries, Australia’s landscape demands innovative approaches to reduce delivery costs and improve efficiency.

Industry expert and CEO at Locate2u, Steve Orenstein, believes one solution lies in optimizing delivery density, where a driver can handle a more significant number of shipments within a concentrated area. By consolidating shipments and strategically planning routes, the cost of deliveries can significantly decrease.

A tricky business 

The challenge stems from Australia’s diverse metropolitan and rural regions. Unlike compact urban centers seen in places like Singapore, where high-rise buildings facilitate streamlined deliveries, Australian cities demand adaptable strategies.

“So for a startup, an early-stage e-commerce business, it’s challenging. You are probably going to use the likes of Australia Post. Other options are available, and it’s thinking about different courier providers based on the type of product that you are sending,” says Orenstein.

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He suggests e-commerce companies use different courier services. “It might be that you are using CouriersPlease, it could be Aramax, you could be using Sendle, there is Toll Group and TNT Express – now owned by FedEx. There are lots of options available.”

Segmenting parcel volumes

Further innovation can be seen in services like Zoom2u, DoorDash, UberEats, and Uber Direct, which functions well under the pressure of same-day deliveries, by segmenting parcel volumes. “There are many options; you don’t have to use Australia Post,” recommends Orenstein. Adapting to these challenges involves exploring competitive options rather than solely relying on a single carrier. 

As businesses expand and shipment volumes increase, negotiating competitive rates becomes more feasible. “Targeting your customers and trying to get as many customers in an area like Sydney or Melbourne definitely will help you to be able to get better rates. Speak to your carriers to say, am I on the best rate structure? What can I do to improve my current rate structure,” says Orenstein. 

In the ever-evolving landscape of e-commerce, you’ll need to be flexible and creative to conquer Australia’s delivery intricacies. It also requires strong partnerships between businesses and carriers. As the industry matures, entrepreneurs will become more cost-efficient as their customer base grows. 

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