)%20(600%20%C3%97%20400%20mm)%20(2).png)
australia post: counter intelligence?
In a NSW country post office, a farmer is withdrawing cash, a backpacker is having her passport photo taken, and a pensioner is paying a power bill.
The chap behind the counter isn't an Australia Post employee. He owns the business, and he's one of the 3,000 licensed post office (LPO) licensees who make up a massive 75% of Australia Post outlets.
Letters may be dying, but parcels and services now bring in $8 billion a year and are still growing. Australia Post carries 95% of regional parcels, largely because LPO contracts actually ban licensees from touching parcels from rival carriers.
.png)
As banks and Centrelink offices close over rural Australia, the Post Office is often the last potential service counter left in town.
To make things tricky, LPO licences are perpetual, so an owne's typical retirement plan is to sell the business. Australia Post says 39% of regional licensees want out within three years. But looking at the trends many can't find buyers, and many LPOs are simply closing for good.
In this standoff: should Australia Post open its Licensed Post Office counters to rivals, and make the network pay its way? Or should it pay rural licensees to go, and restructure the business to fit its vision of the future parcels business?
the strategy standoff
Strategy A: Pass the Parcel
Australia Post could turn the LPO network into a neutral access point, a bit like the NBN. Rival carriers would pay a fee to use post office counters. Banks, agencies and insurers would pay to be represented at the counter. Licensees would get income for work they're set up to do.
But inviting Australia Post's competitors into LPOs would be a culture shock and risk instantly handing a chunk of regional parcels share to competitors.
Strategy B: Return to Sender
Australia Post could pay licensees higher commissions in exchange for converting their perpetual licence to a fixed-term contract. A licence buyback would restructure the rural LPO model, and convert most LPOs to a new low-cost model with parcel lockers.
That might give retiring licensees an off-ramp, but the new term wipes out goodwill owners were counting on to fund their retirement. And if the personal counter is what wins in the parcel business, swapping it for an auto locker would be a risk.
so, which did they choose?
Cast your vote to find out!
better luck next time, strategy b was chosen!
good job, strategy b was chosen!
But did it work out for Australia Post...
expert facilitator commentary by matt
Matt Braithwaite-Young
Managing Partner
t +61 2 9002 3100
On 12 May 2026, the Australia Post board endorsed what it called a "medium-scale trial across five metropolitan clusters". The goal was to test licence buybacks and parcel agent conversions. Strategy B.
Nobody was supposed to know.
Lost in the Mail
The business case was called "Post Office Network & Licensed Post Office Reimagined", and when it leaked, the LPO network was up in arms.
In the country, 1,584 LPOs were in scope for the new model, starting with 159 "last service" towns where there's no bank within 50km. The proposal was for licensees to get higher commissions now, but move to "modernised, mutually-protective fixed term licence agreements".
In other words, shift to a licence with an expiry date.
Australia Post says 70% of eligible licensees would be better off, and that it's voluntary. But the reduced ability to sell a perpetual licence has rattled LPO operators.
Fifteen days after the board vote on the trial, CEO Paul Graham told Senate Estimates there was no program to close post offices. He later called the plan "embryonic" and his answer "truthful". Senator Sarah Henderson told him: "You deliberately deceived our committee." So now there's a Senate inquiry.
Postage Due
Scott Etherington runs the post office in Gulgong and chairs the LPO Group. On the "voluntary" offer, he says telling a thirsty man it's completely up to him whether he takes a glass of water isn't really a choice.
Scott says Australia Post's competitive advantage comes from its retail reach.
Rather than shrinking the network to fit the business, why not grow the business to make better use of the network?
Meanwhile, there's another proposal on the table.
Rival parcel carriers want access to LPO counters, paying licensees to handle their parcels. Their industry forum estimates that opening up the network could generate $1.5 billion in additional economic activity over ten years.
It's an interesting proposition. We can't economically duplicate a national network of post office counters, so why not treat the existing network more like shared infrastructure?
As Scott puts it, Australia Post is "focused on shrinking the network to meet the current business, rather than growing the business to fill this network."
Last Counter Standing
I'm biased, because I met Scott some years ago when he worked in a different industry. He's very smart, and I think he makes a good point.
Australia Post has a natural monopoly in regional parcels, and although it's no surprise they don't want competition, regional consumers should come first.
In any event, Scott's network-first model deserved a fair hearing before the board voted.
Will the new model work? The jury's out. The committee's report has been pushed back to 22 October. (Edit: And now pushed back again to March 27 - Matt)
The big strategic question is whether Australia Post should treat its network as a proprietary competitive advantage or as shared national infrastructure.
The government has a problem too. As shareholder, it wants Australia Post to be commercially sustainable. As government, it wants services maintained in regional Australia. Those might be mutually exclusive aims.
How to Get Your Strategy Signed, Sealed and Delivered
Sometimes you need your strategy supported by people who aren't your employees (franchisees, licensees, dealers, agents). A strategy built without them gets delivered to them, and they hate it.
A Turning Leaf facilitated Joint Business planning workshop brings together your leadership team and any partners you depend on, so you can work together with aligned goals.
We help your team identify the issues, put options on the table (including the ones some people would rather not think about) and then test them to find the best direction.
You walk away with a strategy your network will actually deliver, not just sign for.
To find out more, call us on +61 2 9002 3100 or visit our website to see what we're up to.
get strategy standoff straight to your inbox
Enjoying Strategy Standoff? Get new stories regularly delivered to your inbox to improve your strategic prowess!
