Signed, Sealed, Delivered? How Australian Deliveries are Changing

In last week’s Let’s Regrow Town Hall information session, Power Retail investigated the changing consumer behaviour surrounding e-commerce deliveries.

At the start of April, 81 percent of deliveries were sent to home versus the benchmark of 68 percent. Click & collect dropped considerably and was predicted to drop further, while post offices are also out of favour as collection centres due to stay at home warnings.

“Since our last report, delivery destinations have focused on the home steadily and this would be expected to continue throughout the stay-at-home advisory period,” said Grant Arnott, the Managing Director of Power Retail.

However, in the past week click and collect has seen a slight increase from previous weeks as stores offering the service adapt to COVID-19 compliance.

What does this mean for the future?

In New Zealand, e-commerce deliveries have been restricted to essential items only, which will cause a great impact on the e-commerce economy. “We’re really proud to be providing a vital service to New Zealand at this time, delivering those essential items that New Zealanders need,” said David Walsh, the Chief Executive of NZ Post.

While it’s unlikely that Australia is to follow in the footsteps of New Zealand as COVID-19 cases continue to dwindle, it’s an important factor to consider if it were a viable option.

“A New Zealand scenario could wipe out $25 billion a year minimum (annualised) of e-commerce revenue,” Arnott explained in the first Let’s Regrow Town Hall session.

Even if Australia were to introduce Stage 4 for a month (from April to May), there would still be a dire outcome for retailers, resulting in a $4 billion minimum hit.

Luckily, Australia Post said this was an unlikely option, and as fewer cases are reported, it seems that Stage 4 is an improbable concern.

However, Australia is not out of the dark just yet.

Australia Post has warned of delays of deliveries across rural areas of Australia and is considering reductions in its air freight as a result.

With the current travel ban in place across the country, consumers are expected to experience severe delays on overseas goods, let’s and cross-border parcels. “Australia Post regrets to inform customers that due to reductions in air freight capacity, there may be delays on the letters and parcels network that Australia Post operates around the country, particularly to regional and rural communities,” a spokesperson for Australia Post said.

A spokesperson for Australia Post said that the company is experiencing ‘a big increase in our parcel volumes, similar to what we experience during Christmas time and during online sales such as Black Friday and Boxing Day’.

Over the past few weeks. there has been a 236 percent YoY increase on pharmaceuticals, vitamins and hygiene products. Moreover, there is a 168 percent increase in wine and alcohol-related deliveries from last year.

Despite this massive growth in certain categories, there have been marketed decrease in others. “Although our parcels to consumers are growing strong right now, our letters business, our international business and many of our other great services such as providing passports, have almost immediately shrunk,” an Australia Post spokesperson said. “Even though we are seeing a large number of letters through our business, we have witnessed our letter volumes fall over 45 percent, as has our international revenues and some of the other key services like passports, have halved.”

In the Power Retail Town Hall information session, categories that were experiencing a decline in the last few weeks have seen a slight increase in the last few weeks. “Fashion is seeing something of a rebound as more fashion retailers are offering exceptional deals online in a bid to attract shoppers,” Arnott explained.

“After the initial working from home splurge on home office accessories, the next wave since the start of April is focused on fitness and sporting goods.”

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