An Post: Addresspal, online delivery services from outside state. Effect on local Irish businesses

robut

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Irish shoppers expected to spend more this Christmas

However, with a greater number of Irish shoppers now choosing to shop on foreign websites, the challenge for Irish retailers is to ensure this buoyancy is felt locally and Irish based retailers benefit, Retail Ireland said.

.. He pointed to the “growing migration by Irish consumers” to the internet and he said traders have to date been unable to stem the flow of close to 75 per cent of online consumer spending that leaves these shores.

Central Bank statistics show that total e-commerce spend is likely to exceed €16 billion before year end, a 50 per cent increase since 2015.
( How much of that 75 per cent of online consumer spending is with Irish based online retailers or Irish bricks and mortar retailers that have online presence?? )

Just thought I would start a discussion here on this to hear thoughts on same.

This struck me about a state owned entity ( ?? ) that is AN POST - I realise it probably has to compete BUT this has unintended consequences surely?

We hear year on year that each year outdoes previous year in the bumper christmas sales thing. No doubt this year will be no different?

BUT I am not sure we get good figures on bricks and mortar / local indiginous business shopping christmas spend vs ONLINE SHOPPING christmas spend, particularly using likes of amazon.co.uk and other non Irish based ecommerce store sites. Apparently LAST CHRISTMAS saw the biggest online christmas spend ever from here in Ireland?

Im sure very acurate stats could be got BECAUSE the way ONLINE SHOPPING now works .. even at non Irish based ecommerce sites .. is the Irish Buyer still pays the VAT on the transaction which goes to Irish revenue. BUT the sale and profit goes to a non Irish business. ( No doubt SalmonS might supply such stats? :D )

So my point here is shopping online, particularly via non Irish ecommerce stores surely reduces spend in the local Irish economy? Maybe the fact the gov / revenue is getting the VAT anyway makes it less of concern for them?

Of course An Post is cashing in on all of this, probably (??) making good money out of delivery services to people here who buy from likes of Amazon.co.uk BUT also then are making money from there parcel motel type service called ADDRESSPAL. One could argue that, whatever about the delivery service aspect, the ADDRESSPAL service is a state owned entity actively encouraging people to shop outside of the state? In the USA and UK as per there front page:

https://addresspal.anpost.ie/

I wonder what the uptake is? You could also argue maybe that AN POST needs to wash its face with these services, particularly as there seems to be a fall in people sending Christmas cards by post as its now €1 a stamp? BUT that being said its also a state owned entity impacting on Irish local economy businesses? Is this OK or not?

Thoughts? Both on AN POST and the wider thing of local Irish business v Online retailers this Christmas ..

And PLEASE .. constructive thoughts, not just the glib ADAPT OR DIE thing :D
 
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Prester Jim

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It is a bit off alright but AnPost are in a quandary here, they have to survive and the govt are increasingly removing all support for them, this kind of activity is happening anyway with parcel motel etc so they might as well join in.
Would prefer seeing if there are other models they could use. Are all the other national post services of the EU being let hang or do the Germans or the French support them?
 

Schuhart

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BUT that being said its also a state owned entity impacting on Irish local economy businesses? Is this OK or not?

Thoughts?
I'd say its fine. The relevant point, from an economy point of view, is the fallacy of the broken window. Briefly, that points out that we could create more jobs for glaziers by going around breaking windows. But there would actually be a net loss for the economy, as that would create a cost that we could otherwise avoid.

Similarly, maybe we could create more income for Irish retailers by switching off the internet. But everyone else would lose, as stuff would now cost more. There's no economic gain if we pay more for stuff than we need to.

You don't see many Bianconi cars around anymore. Is that a problem?
 

making waves

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An post does not receive any subsidy from the government (and never has since it was hung out to dry by the government in 1984 without the promised funding from the state). There is talk of subsidising the rural sub-post office network - but this subsidy would go directly to the private sub-office contractors, not An Post.

In contrast - governments throughout Europe (and worldwide) give massive subsidies to their postal services - including to privatised postal services. In 2012 the British government gave Post Office Limited €1.2billion of a subsidy. In Italy between 2009-2011 the government gave Post Italy €1.1billion of a subsidy and then another €458million to subsidise a reduction in postage charges. Since 2009 the French government have given the French postal service over €3.4billion in subsidies. In Ireland the government have given An Post diddly squat - and expects them to 'compete' against massive (and subsidised) state owned and privatised postal services and multinational clonglomerates like UPS.
 

enuffisenuff

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Its a great service for items that you just cant get here at a reasonable price or which just aren't available to purchase at all...there should be no issue really..I mean who wants to get ripped off price wise?
 

robut

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I'd say its fine. The relevant point, from an economy point of view, is the fallacy of the broken window. Briefly, that points out that we could create more jobs for glaziers by going around breaking windows. But there would actually be a net loss for the economy, as that would create a cost that we could otherwise avoid.

Similarly, maybe we could create more income for Irish retailers by switching off the internet. But everyone else would lose, as stuff would now cost more. There's no economic gain if we pay more for stuff than we need to.

You don't see many Bianconi cars around anymore. Is that a problem?
Yes .. very good points.

No i would not advocate that the internet is turned off :D .. I would not be into protectionism

I also see the point that AN POST ( As Jim said ) is in a quandry here.

Its a bit of a strange one. For a state entity to survive it must inadvertently hurt the states own indiginous businesses. And then we are onto these indiginous businesses themselves and there lack of presence in the online sphere. But even if they tried to address that are we into them simply not being able to compete on price with the Amazons etc?? Due to cost of doing business in Ireland etc etc etc
 

robut

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THIS is how much the average Irish householdwill shell out at Christmas

Total sales are expected to top €4.5bn, an increase of €100m from Christmas 2016, but Irish retailers will see a growing portion of their business siphoned off by foreign websites.

The e-commerce sector is rapidly expanding though, with more than €16bn likely to spent online before year end — an increase of 50pc over the past two years.

Retail Ireland director Thomas Burke said this is ‘creating a challenge’ for Irish retailers.

‘Local traders have to date been unable to stem the flow of close to 75pc of online consumer spending that currently leaves these shores,’ he confirmed.
 

Plebian

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An Post are late to this game, other operators have been providing this service here for years.
 

Schuhart

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An post does not receive any subsidy from the government
I'm not sure its as simple as that. The State gave An Post exclusive contracts to make DSP payments and collect the TV licence. But, indeed, at the same time the need to keep open a largely unused branch network seems to be a heavy burden. There is a fudge there, and even a bit of a fudge in An Post offering this service - which implicitly points to the redundancy of large branch networks, such as the post office network.
And then we are onto these indiginous businesses themselves and there lack of presence in the online sphere. But even if they tried to address that are we into them simply not being able to compete on price with the Amazons etc?? Due to cost of doing business in Ireland etc etc etc
I'd agree it would be useful to identify exactly why the likes of Amazon can compete on price. Is it simply that they can generate massive economies of scale?

At the same time, you'd think there must be diseconomies of scale, too, offering at least the potential for retailers to respond with a competitive offering. Is the Amazon model robust from a climate change point of view? Maybe it is, but presumably that hyper-centralised model assumes transport costs are relatively cheap compared to the cost of maintaining physical premises.

Or maybe there's just some element of the traditional model that's overvalued. Maybe commercial retail premises should be cheap as chips.

I don't know if anyone has systematically compared the costs facing a traditional retailer vs Amazon. But presumbly that's whats in play.
 

MsDaisyC

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An Post are late to this game, other operators have been providing this service here for years.
I've yet to come across someone else delivering from the US for a reasonable price. I got stuff from America that I can't get here delivered less than a week after ordering. I initially checked the price the shop itself would charge me for delivery and addresspal was half that. I'd only use it for US purchases though, Parcel Motel are good for the UK ones.
 

Trainwreck

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Irish shoppers expected to spend more this Christmas



( How much of that 75 per cent of online consumer spending is with Irish based online retailers or Irish bricks and mortar retailers that have online presence?? )

Just thought I would start a discussion here on this to hear thoughts on same.

This struck me about a state owned entity ( ?? ) that is AN POST - I realise it probably has to compete BUT this has unintended consequences surely?

We hear year on year that each year outdoes previous year in the bumper christmas sales thing. No doubt this year will be no different?

BUT I am not sure we get good figures on bricks and mortar / local indiginous business shopping christmas spend vs ONLINE SHOPPING christmas spend, particularly using likes of amazon.co.uk and other non Irish based ecommerce store sites. Apparently LAST CHRISTMAS saw the biggest online christmas spend ever from here in Ireland?

Im sure very acurate stats could be got BECAUSE the way ONLINE SHOPPING now works .. even at non Irish based ecommerce sites .. is the Irish Buyer still pays the VAT on the transaction which goes to Irish revenue. BUT the sale and profit goes to a non Irish business. ( No doubt SalmonS might supply such stats? :D )

So my point here is shopping online, particularly via non Irish ecommerce stores surely reduces spend in the local Irish economy? Maybe the fact the gov / revenue is getting the VAT anyway makes it less of concern for them?

Of course An Post is cashing in on all of this, probably (??) making good money out of delivery services to people here who buy from likes of Amazon.co.uk BUT also then are making money from there parcel motel type service called ADDRESSPAL. One could argue that, whatever about the delivery service aspect, the ADDRESSPAL service is a state owned entity actively encouraging people to shop outside of the state? In the USA and UK as per there front page:

https://addresspal.anpost.ie/

I wonder what the uptake is? You could also argue maybe that AN POST needs to wash its face with these services, particularly as there seems to be a fall in people sending Christmas cards by post as its now €1 a stamp? BUT that being said its also a state owned entity impacting on Irish local economy businesses? Is this OK or not?

Thoughts? Both on AN POST and the wider thing of local Irish business v Online retailers this Christmas ..

And PLEASE .. constructive thoughts, not just the glib ADAPT OR DIE thing :D

Why do I owe anyone my business? Why should I be forced to buy off specific sources?

They can compete for my custom.


FFS.
 

robut

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Why do I owe anyone my business? Why should I be forced to buy off specific sources?

They can compete for my custom.


FFS.
Level playing pitch? Larger Rates, rent, Staff & other costs of doing business in Ireland for local bricks and Mortar businesses vs do AMAZON have these costs online as much?
 

clearmurk

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I'd say its fine. The relevant point, from an economy point of view, is the fallacy of the broken window. Briefly, that points out that we could create more jobs for glaziers by going around breaking windows. But there would actually be a net loss for the economy, as that would create a cost that we could otherwise avoid.

Similarly, maybe we could create more income for Irish retailers by switching off the internet. But everyone else would lose, as stuff would now cost more. There's no economic gain if we pay more for stuff than we need to.

You don't see many Bianconi cars around anymore. Is that a problem?
But, but, but....the glaziers would become wealthy, and then they would spend their wealth for the benefit of everyone.
 

Schuhart

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Level playing pitch? Larger Rates, rent, Staff & other costs of doing business in Ireland for local bricks and Mortar businesses vs do AMAZON have these costs online as much?
Just another angle, I found an interesting article here
Wal-Mart: Amazon's One Big Advantage for Cheaper Prices | Money

Many investors trade on Amazon not based on its current profits or quarterly performance, but on long-term growth potential. That gives Amazon a real competitive advantage compared to a traditional company and stock like Walmart, where management has to worry about delivering on short-term results.
I'm not saying that's true or false - I don't know. It's just an interesting take on why it is that the internet companies seem to be cheaper for many items, given that the only component in play is really how the manufactured item gets from the stockist to the customer.

If the Time article is correct, it poses a second question. Who are these investors and how are they able to afford the cost of tying up capital while waiting for a (hoped for) profit down the line?
 

Voluntary

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Level playing pitch? Larger Rates, rent, Staff & other costs of doing business in Ireland for local bricks and Mortar businesses vs do AMAZON have these costs online as much?
Economies seek equilibrium and that's what we experience today. Ireland kept it's status quo for very long time when consumer accepted higher costs then in the surrounding world because of the sea barriers and logistics problems. With the online shopping and cheaper transportation costs this is no longer the case and consumer having a choice is just doing the smart thing shopping abroad.
Long term, local businesses will adjust on pricing. Some will go off business, new/smarter ones will rise . It's only natural.

Good thing is that people can shop cheaper, so they can spend more cash in different areas - services sector comes to mind.
 
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TakeitAll

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I've yet to come across someone else delivering from the US for a reasonable price. I got stuff from America that I can't get here delivered less than a week after ordering. I initially checked the price the shop itself would charge me for delivery and addresspal was half that. I'd only use it for US purchases though, Parcel Motel are good for the UK ones.
Used the AddressPal and was happy with the service. Bought a Santa present from Amazon UK and Parcel Motel was no use for that as they only provide you with an NI address but Amazon UK was deliveries in mainland UK.
 


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