Fraud and freight costs and a lack of connected systems is forcing up the price of online goods in Australia with some retailers now refusing to ship goods to PO boxes and lockers because of the high incidence of theft.
Some retailers claim that Australia is a “backwater” when it comes to systems to support online retailing. They claim freight costs are high and that suppliers are lacking the technology to streamline freight delivery, they also claim that theft from PO boxes and lockers is an issue with some retailers now refusing to ship to these locations.
JB Hi Fi marketing director Scott Browning claims that back in 1997 the US and UK markets were further ahead than Australia is today because direct sales to the home made up over 15% of the total market.
“These markets had catalogues and the freight Companies and suppliers supporting the retailers put into place the systems to support the delivery of goods we are still playing catch up because catalogue selling did not take off in Australia” Browning said.
Browning said that fraud and the high cost of shipping goods in Australia was “a problem” for retailers he said that his Company has stopped shipping to PO boxes as there is no one of ensuring that the owner is genuine.
Another mass retailer said that the emergence of lockers has to be managed properly. “Crooks are using false identities to take out lockers and PO boxes and once we have shipped the goods to a person using a stolen credit card we are the ones left responsible for the loss”.
Mark Bouris the CEO of TZ is trying to battle it out with Australia Post for a share of the online shopping delivery business, signing up a raft of retailers, including Nike.com, to use parcel lockers to deliver goods.
His listed technology company TZ have not said how they will handle security issues or what impact a ban by retailers on lockers or PO boxes will have on his business.
Toll Group last week announced that they had partnered with one of Australia’s biggest e-tailers, Grays Online, for parcel delivery.
Toll said the partnership would significantly increase its estimated 7 per cent share of the business-to-consumer express delivery market, which is dominated by Australia Post.
At the recent Magento Live conference Chris Jones the Business Manager of Door Busters a Woolworths owned Company said that freight costs in Australia was a “major issue”. He said that Woolworths was now looking at using up to eight freight companies as several local freight companies could deliver cheaper than Australia Post and national freight Companies.
Both JB Hi Fi and Dick Smith are now putting in place systems to manage stock control with goods being delivered from local stores.
One of Australia’s most prominent online retail experts says more sales may be lost to foreign retailers if online and traditional shopkeepers don’t get together to offer competitive prices and better services.
Paul Greenberg, CEO of the National Online Retailers Association and founder of online operator Deals Direct, said Australian retailers need to work more closely together.
Figures published last week by the Australian Bureau of Statistics showed that Australians spent $62 billion dollars on goods purchased online from offshore retailers in the 2011-12 year, compared with $4.5 billion spent on online purchases from domestic retailers.
