Australia Post: Strategic Analysis and Recommendations

This paper provides a strategic analysis of Australia Post, including a Pestle analysis and Porter's Five Forces analysis. Recommendations are also provided for the company's future growth and success.

Running head: Australia Post
Australia Post

Australia Post
Executive summary
In this paper, the discussion is made on the Australia Post. The paper has presented the strategic
tools such as Pestle analysis is conducted in reference to the macro environment. Also, a
different corporate strategy is elaborated. There are different strategic tools such as Porter five
force models and VRIO MODEL. In relation to these models, it is important for the company to
consider these tools so that different challenges that pertain in the company can be reduced. By
conducting the entire analysis with the help of thee tools, it has been observed that competition
level faced by the company is high, so to minimize it latest technologies are important to be
considered as it will help to attain growth in the competitive market.
The purpose of the report is to analyze the different factors that affect the overall activities of the
company. These factors play an important role so it is important to analyze it as it can assist in
boosting the profits of the organization. If the business environment is analyzed then it will help
in enhancing the market share of the company and also the positive impact will be seen on the
brand image in the competitive business world.
2

Australia Post
Table of Contents
Executive summary.........................................................................................................................2
Introduction......................................................................................................................................2
Macro environmental factor............................................................................................................3
Pestle analysis..............................................................................................................................3
Industry analysis..............................................................................................................................4
Life cycle stage............................................................................................................................4
Porter Five force analysis.............................................................................................................4
Company analysis............................................................................................................................6
VRIO FRAMEWORK.................................................................................................................6
Competitor analysis.........................................................................................................................7
Strategy analysis..............................................................................................................................7
Recommendations............................................................................................................................8
Conclusion.......................................................................................................................................8
References........................................................................................................................................9
3

Australia Post
Introduction
Australia Post is one of the postal service companies managing the activities in the market of
Australia. The head office of the company is situated in 111 Bourke Street, Melbourne. In 2017,
the revenue of the company was 680 AUD. There are different subsidiaries of the company such
as star Track and Secure Pay Pty Ltd. The company is located in 4429 metropolitan areas and
2561 retail outlets are in rural and remote areas (Australia post, 2019).
There are more than 32,732 employees who are managing the work of the company. The
industry deals in postal services and the company has the ranking on 23rd position in top 100
financial brands in the Australian market. The company deals in different services such as
parcels and mails (stamp, parcel collection and delivery) and also in money and insurance sector.
Australia Post has many post offices such as there are 11.4 delivery centers and also 4400 post
offices located in the different locations of Australia. The challenge that was faced relates with
the communication. This case will be analyzed to find out the different aspects that affect the
activities of the company in the highly competitive business world (Australia post, 2019).
Macro environmental factor
Pestle analysis
It has been analyzed that the company has to take into consideration the external environmental
factors so that accurate decisions can be taken. So, in relation to this the Pestle analysis tool will
be used that will help to analyze the different macro environmental factors.
1. Political factor
This factor impacts the business activities of the organization. Australia is considered as the
industrialized nation and there is stability in relation to the political aspects. There are different
opportunities that are concerned with the Australia Post. The company has the chance to
maintain the innovative strategies that will help in maintaining the competitive advantage.
Therefore, it is examined that the company has support from the government (Hanson et al.,
2016).
2. Economical factor
4

Australia Post
If economy of Australia is considered then it has been seen that it is good and also it is
enhancing. The overall rates of the government in context to the tax rates are flexible for the
multinational companies. The economic conditions of the company also favor the overall
activities of the company (Philipson, 2015).
3. Socio cultural factor
In Australia the individuals have more preference for the western culture and there are different
styles that are considered. The majority of the public in the Australian market is using the e-
commerce website. By considering this factor, it can be seen that the company has the chance to
offer the postal packages (Höglund et al., 2018).
4. Technological factor
It is examined that in the Australian market, the people are focused toward using the latest
technologies. If company is considered then it is seen that new trends and styles helps to boost
the success rate. The organization also introduces different e services like track items and hold
mail. There are unique technologies which are considered such as tray management system,
barcode sorting machines and also video coding machines. These technologies assist in
enhancing the productivity and also the growth in the competitive business world (Çakır, Perçin
and Min, 2015).
5. Legal factor
The legal factor varies from country to country. In relation to the legal factors, there are different
aspects such as customer law, copyright law and also the laws related with imports and exports.
For the domestic companies the rules and regulations are favorable (Australia post, 2019).
6. Environmental factor
The environmental factor in relation to the company can be related with Geographical location
and climate. Australia is considered as the county that is rich in terms of the resources. It is
necessary for the company to focus on considering the recyclable packaging so that environment
cannot be impacted (Evans and Phelan, 2016).
5

Australia Post
Industry analysis
Life cycle stage
The company is on the growth stage as it has been seen that the sales has been enhanced.
Australia post is also investing in the promotional activity that helps to enhance the overall
potential in relation to the growth stage. The company is enjoying the goodwill in the market and
due to this the market share of the company is boosted. But slowly the company is emphasizing
on the maturity stage in which the services of the company are established and the main of the
manufacture is to maintain the market share they have built up. The company is also bringing
modifications in the production process that will help to maintain the competitive advantage
(Chong, 2015).
Porter Five force analysis
1. Buyers bargaining power
There is high competition level in context to the postal services. The Australian post has different
customers who are having the diverse bargaining power and due to this the bargaining power can
be considered as low. The power of the corporate customers is high and due to this it empowers
the bargaining power of the buyers (Philipson, 2015).
2. Suppliers bargaining power
There are different suppliers that are present in the market so there is less dependency on the
suppliers. It has been seen that there are different suppliers so due to this the bargaining power is
low. In reference to the logistic activities, it is examined that it is weak as there are various
owned vehicles that are considered at the time of transportation. Therefore, it can be said that
there are different dealers for the vehicles and also dependency is less on the players (Chapman,
McLellan and Tezuka, 2016).
3. Threats of Rivalry
The threats of rivalries are high as there are many providers of the similar services in the
Australian market. The different competitors present in the market are Fed Ex, DHL and TNT.
The competitors are considered as the major threat for the company as they are offering similar
type of services. It is analyzed that competitors offer different services in the market that can
6

Australia Post
help the customers in considering the next product or the service if it is not available in a proper
manner. The service that is offered at a low cost can make a huge difference in relation to the
operational activities of the company. So, it can be stated that this can also affect the demand of
the services in the competitive market (Philipson, 2015).
4. Threat of substitutes
It is high as one of the important factors that relate with the price of the services offered in the
market. The customers have the knowledge of the process related with the price of the postal
services. The services of the company are offered at different process and due to this the major
benefit is related with the large market share (Australia post, 2019).
5. Threats of new entrants
For Australian post, it is examined that the threat of new entry is low as high cost of investment
is incurred which is related with the new postal service. There is also high requirement of the
transportation vehicles that are important to be considered by the company. The competitors that
exist in the market are DHL and FED EX (Varzaly, 2015).
Company analysis
VRIO FRAMEWORK
 Valuable
The Australia Post shows that the financial resources are highly valuable and these assist in
investing into the external opportunities that takes place. The patent of the company are valuable
resource as it helps the company to sell its products without any competitive interference. Also,
it can be stated that research and development at the Australia Post is not considered as a
valuable resource. This is only due to the research and development cost more than the benefits
that are offered in the form of innovation (Frynas, 2015).
 Rare
The overall distribution network of the company is rare as it is seen that competitors will require
a huge investment and also time. So, these are only possessed by the few companies in this
7

Australia Post
industry. The employees of the company are also rare as they are trained and have the skill to
manage the overall activities of the company. The better compensation and work environment
also helps to ensure that employees will never leave the workplace (Australia post, 2019).
 Imitable
The financial resources of the company are costly to be imitated and also these resources can
only be attained by the company in relation to the prolonged profits over the years. The
employees of the company are also not imitable as the company provide better compensation and
also work environment to the employees. The patent of the company are also very difficult to be
imitated as it is not legally allowed to imitate a patented products easily (Crew and Brennan,
2016).
 Organization
The overall financial resources of the company are maintained to capture the value that is
considered. The resources are also invested in the right place which helps to consider the
opportunities and threats. So, the resources are considered as the major source that will help in
maintaining the competitive advantage (Australia post, 2019).
Competitor analysis
In the market of Australia, the company is known as the biggest organization. It has been seen
that company attained 60% of the entire share market in context to the delivery of the parcels.
The competitors of the company are Fed-EX, TNT and DHL. The TNT also has 10% and DHL
have 5% of the total share in the sector of trade of delivery parcels. The competitors of the
company also boost the market share by emphasizing on the margin of the giant organizations
such as FED EX and TNT. It is examined that there are different competitors such as Fed EX
and also united parcel that provides services on the international platform. FED Ex is the
company that is not providing domestic parcel service in the Australian market. Therefore, it can
be said that the company is losing the share market but only because of innovation and research
and development the growth has been attained in the market (Soong and Cominos, 2018).
8

Australia Post
Strategy analysis
The company focuses on boosting the satisfaction level of the customers and also it can be done
by fulfilling the needs of consumers. In the recent business environment, the company has
renewed the various business strategies. They have focused on maintaining the alliance with the
companies such as Amazon and EBay. The modifications in the technology have also impacted
the courier services positively. The digitalization has also helped the customers to track the
courier by sitting at the home and due to this the positive impact has been given on boosting the
customer satisfaction. It is analyzed that the company has considered the different strategies to
enter into the e-commerce sector and due to this the companies also maintained the accuracy of
the company. The main aim of the company is to boost the customer relations so that growth can
be attained (Liao, Rice and Lu, 2015).
Recommendations
It is recommended that because of the high competition level in the postal service sector, it is
necessary for the management to introduce the new concepts and ideas in the competitive
market. The company also considered the various strategies like postal parcel and done
technology that can provide different perks and advantages to the employees. It can also help in
boosting the customer rating in relation to the activities of the company. Regular feedback can
also assist the company in enhancing the satisfaction level of the customers to the overall
decision of the organization.
Conclusion
It can be stated that the company is in the good position in the market. By taking into
consideration the different models such as Porter five force models, it could be easy for the
company to consider the exact position in the market. Also, the different models have offered the
market position that should be considered before conducting the operational activities. Therefore,
it can be concluded that company should focus on considering the different strategic tools so that
it could be easy to consider the right decision in relation to the overall activities of the company.
9

Australia Post
References
Australia post, 2019 .About us. [Online]. Available at: https://auspost.com.au/. [Accessed on: 19
April 2019].
Çakır, S., Perçin, S. and Min, H., 2015. Evaluating the comparative efficiency of the postal
services in OECD countries using context-dependent and measure-specific data envelopment
analysis. Benchmarking: An International Journal, 22(5), pp.839-856.
Chapman, A.J., McLellan, B. and Tezuka, T., 2016. Residential solar PV policy: An analysis of
impacts, successes and failures in the Australian case. Renewable energy, 86, pp.1265-1279.
Chong, F., 2015. Stamping a firm footprint in China: Australia Post defines its future in e-
commerce. Asia Today International, 33(2), p.7.
Crew, M.A. and Brennan, T.J. eds., 2016. The future of the postal sector in a digital world.
Heidelberg: Springer.
10

Australia Post
Evans, G. and Phelan, L., 2016. Transition to a post-carbon society: Linking environmental
justice and just transition discourses. Energy Policy, 99, pp.329-339.
Frynas, J.G., 2015. Strategic CSR, value creation and competitive advantage. The Routledge
companion to non-market strategy, pp.245-262.
Hanson, D., Hitt, M.A., Ireland, R.D. and Hoskisson, R.E., 2016. Strategic management:
Competitiveness and globalisation. Cengage AU.
Höglund, L., Holmgren Caicedo, M., Mårtensson, M. and Svärdsten, F., 2018. Strategic
management in the public sector: how tools enable and constrain strategy making. International
Public Management Journal, 21(5), pp.822-849.
Liao, T.S., Rice, J. and Lu, J.C., 2015. The Vicissitudes of Competitive Advantage: Empirical
Evidence from A ustralian Manufacturing SMEs. Journal of Small Business Management, 53(2),
pp.469-481.
Philipson, G., 2015. Where to now for Australia post?. Government News, 35(5), p.8.
Soong, H. and Cominos, N. eds., 2018. Asia Literacy in a Global World: An Australian
Perspective (Vol. 45). Springer.
Varzaly, J., 2015. The enforcement of directors’ duties in Australia: an empirical
analysis. European Business Organization Law Review, 16(2), pp.281-319.
11