Industry case study: Australian postal and parcel delivery relevance to food and grocery industry

Posted by AFN Staff Writers on 21st October 2015

PostAustralia’s delivery logistics landscape is rapidly changing. This creates new opportunities and may create some unexpected impacts for sellers and buyers in the Australian food industry.


A March 2015 report from IBISWorld estimated that between 2015 – 2020 Australia’s online grocery sales industry will grow by 13.6 per cent annually. With sales increasing, delivery of product is a a major area for potential growth. 


Beyond online grocery shopping in itself, some of Australia’s largest supermarkets have corporate relationships within the delivery industry. For example, in April 2015 Coles parent company group Wesfarmers has expanded its subsidiary Officeworks with a logistics delivery service by launching its MailMan in-store parcel delivery service. In February 2015, eBay announced a new partnership which has resulted in shoppers now being able to accept delivery of their online products from Woolworths. 


So what does Australia’s product delivery  industry currently look like and how will it potentially impact the Australian food industry?


Key Facts


  • According to eBay research, one in five online shoppers in Australia buy online at least once a week but almost half are not allowed to receive deliveries at home.
  • As part of the same research performed by eBay, the online auction service found that 23 per cent of Australians have taken a holiday or worked from home just to receive an online delivery.
  • Half (49 per cent) re-direct personal online deliveries because they are at work, according to the eBay research.  
  • In 2014 Australians spent $16.4 billion on online retail.
  • According to IBISWorld, online grocery sales in Australia between 2014 – 15 created AUD$2.0 billion in revenue
  • IBISWorld also says online grocery profit in Australia between 2014 -15 amounted to AUD$79.9 million.


Companies to know about


Australia Post (AusPost)


Although in September 2015 AusPost announced a AUD$22 million loss for the financial year ending the 30 June 2015, parcel deliveries now account for more than half of the organisation’s revenue.


Australia Post now appears to be moving forward from its latest results and heavily focusing on its parcel delivery service just launching a new advertising campaign centered around the tagline ‘We Love Delivering’. In 2014 it also launched a  US parcel service, allowing Australians to purchase from US companies which do not ship to Australia. Australia Post collects and forwards on the purchase.


Kogan is the largest online department store in Australia. It sells everything from electronics to groceries, all under the guidance of its young founder Ruslan Kogan. The Wall Street Journal estimates the company was being worth over $400 million.




Coles supermarket group parent company, Wesfarmers, has created a new delivery service within its Officeworks stores. As previously mentioned, in April 2015 Officeworks launched ‘Mailman’ allowing customers to send and receive mail and parcels through its stores.


The service appeals to customers on the basis that Officeworks stores are open much earlier and much later than Australian Post stores, along with weekend opening hours. Address labels can also be purchased online anytime. 


Woolworths and Ebay


In February 2014 it was announced that eBay, Woolworths and its retail chain Big W would partner so that eBay purchases could be picked up from 90 Woolworths and Big W stores.


The program has expanded since launch  and there are now stores across the east coast  reaching between Tasmania and Queensland. 


By the end of the year, eBay said that more Queensland metro stores will be opened which will see 60% of eBay buyers (about 5 million shoppers) in Australia living near a Woolworths or Big W collection point


DHL Express


DHL Express, an arm of Germany’s Deutsche Post, is considered the world’s largest global logistics company. DHL Express says it currently owns half the air express market coming in and out of Australia.


In July 2015 the Australian division of DHL Express announced it would be a trialing a new “On Demand Delivery” system which would see customers have a great say in exactly how their parcel is delivered. Customers would for example have the choice to leave parcels with their neighbours.


Pakman Parcel Box


Pakman Parcel Box is a secure mailbox which is large enough for most parcels to fit inside. Once registered and installed like a normal letter box, owners are instructed to provide the unit’s passcode to delivery services so products can be safely delivered.


Currently sold through Bunnings Warehouse and is owned by Mayo Hardware, which also owns the highly successful MasterLock brand.
Although the standard old letterbox prevails in Australian homes, Mayo Hardware have been investing in the Pakman Parcel Box with television commercials and spots on weekday morning television talk shows.