Posts like Australia Post and Austria Post now use Backward Integration, a well-known competitive strategy to control more of their supply chain; ensure a continued or increased supply of parcels, lower operating cost through economies of scale (transportation, labour, sortation, etc.); differentiate their brand from the competition; integrate shippers into their Post; and possibly control a larger market share through this competitive edge.

More importantly, these Posts are also promoting their country’s manufacturers and retailers thereby also creating jobs and improving the economy.

For years, many Posts have used a “diversification” strategy – selling more out of the same square footage and using the same labour pool. Some Posts have stayed within complementary products (postcards, pens, stationery, books, magazines, etc.). Others have expanded into selling mobile phones and myriad other products and services.

Diversification can increase revenues, increase market share, reduce dependency on specific products and provide some risk protection. Diversification also has its risks – brand damage or dilution; costs due to supply chain and inventory management, warehousing, training and loss; overextension; reduced innovation and of course having to keep and maintain the real-estate for products that, after all, have nothing to do which your core business.

PostNord Sverige, the Swedish postal service, operates an international storefront (through EhubNordic) for Swedish companies wanting to sell in the Asian market. The next step is Korea.

This past spring, Austria Post launched its online, domestic marketplace, defined as “from Austria for Austria.” Shoppers choose from Austria Post’s list of delivery options.

Australia Post acts as a middleman or intermediary for the MSMEs. It brings the technology, the web skills, the contacts, the business information on markets, the knowledge of the right products for export, the marketing skills, the translation skills and the billing process. It allows Australian MSMEs worry-free selling of their products within Australia and in the growing international markets of China and South East Asia, for a commission.

Australia Post’s trusted, domestic website for MSMEs, called Farmhouse Direct, gives Australian farmers and producers another way of selling their products beyond their own city, directly to the Australian population of 20 million Internet users.

In addition, in order to promote exports abroad via Australia Post, it has enabled MSMEs to sell their products across Alibaba’s key platforms (websites) including Tmall Global, JD Worldwide and Australia Post has set up storefront pages on these websites. Participating MSMEs can access more than 560 million consumers in six countries throughout South-East Asia. Australia Post also plans to open more storefront pages on other sites in Vietnam, Thailand and the Philippines.

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