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Home / Business / Companies / Freight and logistics

NZ Post defends controversial new pricing scheme

NZ Herald
23 Apr, 2008 04:54 AM3 mins to read

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KEY POINTS:

New Zealand Post has moved to defend its new parcel pricing scheme, following an outburst of outrage from online traders.

The company last month introduced a "pricing in proportion" scheme, in which letters and parcels are charged in direct proportion to their size and weight.

Items were previously charged by weight alone.

The new scheme applies to all standard domestic mail, though the cost of a standard post medium letter remains at 50c.

The move has seen feedback running hot on websites including Trade Me, as online sellers vent over a pricing regime they say is costing them more to send goods around the country.

"I took a 1.1kg package into NZPost Rotorua. I placed a 1.5kg sticker on it and then the teller tells me I have to pay an extra $4.00 on top of the 1.5kg sticker because of its size," one disgruntled NZ Post user told Trade Me.

Another Trade Me postee claimed: "The lady behind the counter told me it was cheaper on Courier post than on NZ post. I got the shock of my life...".

One Whakatane feather-selling business told nzherald.co.nz of a near tripling in the cost of sending a parcel since the scheme was introduced.

"Our business has all but ground to a halt since a box that, for the last 3 years, has cost $4.25 to send anywhere in New Zealand is now costing us $12.50 to send to the South Island, over $10 to send to Auckland and Wellington and more than $6 to send (locally)... No one wants to spend the same again on shipping that they have paid for their feathers."

But postal services chief executive Peter Fenton yesterday told the Herald NZ Post had been forced to review its pricing as increasing numbers of parcels were incapable of being deposited in mailboxes, and instead had to be delivered by courier.

It was the first price rise in 10 years, and about half of all parcels were too big to be delivered by a postie, he said.

The new prices reflected "a courier cost of delivery", and spiralling fuel prices were a "key driver" in the new pricing, he said

NZ Post competitor Freightways said last month the NZ Post move would see some parcel postage charges double or triple.

But Mr Fenton said the the new scheme had seen about 30 per cent of parcels become cheaper to post.

Parcels that were "quite large, but very light" would likely become more expensive to send. About two per cent of parcels fell into that category.

In 2005, NZ Post's chief executive John Allen claimed Trade Me had helped boost parcel volumes by 7 per cent.

Mr Fenton said the company remained committed to providing "the best possible delivery service, that reflects the time, cost and effort of delivering that item".

Trade Me commercial head Mike O'Donnell said this afternoon NZ Post was not a monopoly, and sellers had every right to shop around.

"At the end of the day, the consumer will go to the person who provides the best service."

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