Shipping parcels in Australia: The good, the bad and the ugly!

Shop For Safety is an online store, based in Sydney, Australia. Currently we ship about 30 parcels a day, mostly to locations in Australia. As I don’t want to waffle on for too long, I will only discuss local postage in this post.
We send parcels of all sizes. The ration is about 40% small bags (under 500g), 35% medium sized boxes or parcels (3-5kg) and 15% very big parcels or 2-3 boxes.
Some days we send 40 parcels, other days we only send 10. It is very hard to predict.

We currently use Australia Post because at the beginning, when I looked into using couriers instead of Australia Post, the process of signing up was very laborious, the fee structure was very complicated and we needed to have a minimum amount of parcels every week. This made it impossible to use anyone but Australia Post at the very beginning.
There are a lot of positives about Australia Post. It is very easy to use. Anyone can sign up for an online account and print pre-paid labels, then just drop off the parcels to any post office. Australia Post is also the only courier who covers all of our vast country.
In the 5 years we have been operating and using Australia Post, I found them to be very reliable. Only 2 parcels got completely lost. We were refunded the cost of the items and postage.
A few other items got lost, but were found after an investigation. Some items were late and we have heard complaints about contractors not ringing bells or not leaving cards in the mailboxes, but mostly I can say that Australia Post is a very good service provider, when it comes to the service of delivering our parcels.
Our clients also prefer to get a card in case they are not home at the time of delivery and go to collect items at their local post office, rather than have to wait for half a day for a courier.

Our experience with couriers has not been bad. TNT and Fastway do regular deliveries to us from our suppliers and they are usually done the next day.

Now let’s move on to the ugly…
We have a My Post Business Account with Australia Post, but we still have to pay $7.95 to send parcels under 500g even if we are sending it literally down the road. Add a few grams to a total of 650g, and it can cost $13-$14 depending on where we are sending it to.
Once I had to send a parcel to a post box in Mosman, NSW. I went to the Mosman post office and asked if I could just handle it in. I was told I could, but I still had to pay the $7.95 postage fee. For what? For the 2 seconds it would take them to put the item in the mailbox?
Some of you might oppose my reasoning and say that it is a fixed cost and it applies to everyone, I was still using their service. The problem is that, no, it does not apply to everyone. It only applies to everyone in Australia.
I can buy an item with the same weight and dimension from a retailer in China and he will pay $2.95 to China Post to send it to me, here in Australia. Guess who will deliver my Chinese item? Yep, Australia Post.

I want to finalise this post with some questions for reflection.

How is it possible for us, small and medium Australian Businesses, to compete with overseas retailers if we are faced with such unfair postage policies? How is this going to help Australia’s economy and create jobs?
Why are there no safety nets in place to make it fairer for small and medium sized Australian based businesses?
We already have to charge GST while the international sellers can get away with not charging it for items under AU$1,000. On top of that, we get hit by postage that costs 3x what they have to pay.
How can we be competitive?