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2015-02-16

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Printers and mail houses condemn price increases saying it will cut mail volumes

Printers and mail-houses have condemned Australia Post plan to raise bulk mail prices by up to 7%, amid fears it will drive advertisers further away from direct mail.

The second price hike in 11 months takes effect on March 2, and sees small-sized pre-sort mail, the most heavily used by printers, rise by 7.3 per cent for same state and 7.1 per cent for interstate on regular delivery, and 6.8 and 6.5 for priority. This is equates to a 20% increases for certain bulk mail types in the past year.

“It’s insane, advertisers will absolutely cut volumes or get out of direct mail completely,” he said. “Australia Post is basically saying it doesn’t want to do mail anymore.”

Integrated Mailing Services (IMS) Managing Director, Buzz Borsitzky, said there is no question advertisers are reducing volumes because of rising delivery costs.

PIAA Chief Executive Bill Healey said increased prices will hasten the demise of direct mail. Healey said the alliance between the PIAA, mailhouses, unions, and post office owners is trying to get Post to collaborate with stakeholders to identify opportunities to grow mail. The relevance of mail to the Australian economy that might surprise them,” he said.

CWU National Assistant Secretary. Martin O’Nea, said price increases far in excess of CPI will drive down volumes thus leading to more price increases and reduced standards “It becomes a self fulfilling prophecy, small increases can be justified but in excess of 600% of CPI over 12 months is hardly sustainable."

“There are billions of dollars of economic activity generated by the traditional mail service and Post senior management need to be reined in less this economic activity is placed in jeopardy. The Jobs of our members are obviously our first concern but the potential for job losses and services else where, especially in regional Australia is also deeply worrying," said Mr O’Nea.

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