As at 30 June 2006, we had 2,975 licensed post offices (LPOs) – which represents two-thirds of our total retail network. LPOs are independently run small businesses that play a vital role in the economic and social life of the communities they serve.

Overall retail and agency revenue from the LPO network increased this year by 4 per cent.

The national Licensee Advisory Council (LAC) is made up of nine elected licensee representatives and four senior managers from Australia Post’s national Retail business. Each state also has its own LAC. These were established in 2003 to provide a forum for licensees and Australia Post to discuss business development initiatives and to address matters of concern to licensees. In 2005/06, the national LAC met in July, October, February and May.

Among its achievements in 2005/06 the LAC has been responsible for several new supplier arrangements that have offered licensees more choice in several product lines, such as telecommunications and insurance.

Through the Bank@Post program we installed technology to provide on-line banking facilities at a further 110 LPOs in 2005/06. Another 120 LPOs will receive this capability in the first half of the new financial year.

While maintaining our strong relationship with our LPO business partners, we are also introducing franchises into our retail network to support Australia Post’s commercial viability and provide for a more consistent customer experience.

A PostShop franchise agreement differs from an LPO licence agreement in a number of ways, particularly in relation to the term of the licence, arrangements for stock and other capital investment. For example, all equipment in a franchised outlet is supplied and owned by Australia Post.

The franchises will operate alongside our current corporate PostShop and LPO networks and will not compete with existing outlets.