| The largest retail network in Europe is not Tesco, or Carrefour, or Marks and Spencer, as many might guess. It is, in fact, the venerable British institution of the Post Office. There are around 14,000 local post offices within the UK, meaning that 94% of the population lives within one mile of a branch – the sort of coverage that a multinational company would envy. Around 550 offices in the network are managed directly by Post Office Ltd. The remainder are run subpostmasters/mistresses – private business people who often also run a retail business, such as a stationers or newsagents, on the same premises. There is also the opportunity to buy a Post Office franchise. If you already own a retail business and are looking to expand, or you are looking to launch a business from scratch, a Post Office franchise could be the answer. For more information on this, visit the Post Office website or click on the link on the right hand side of this page. Troubled times But despite its size – or maybe because of it – not all is rosy across the network. Although the vast majority of these branches are viable businesses, the future of branches in deprived or rural areas remains uncertain. In rural areas, post offices are threatened by the same processes that are making many rural businesses unviable – a declining or ageing population, low incomes and a preponderance of second and holiday homes. The Government is still considering withdrawing the Post Office Card Account (POCA), the scheme which allowed those on benefits to continue to collect payments from post office counters, rather than having them paid directly into their bank account. Offices in poorer parts of the UK are very reliant on the income from benefit collection and their future would be in serious doubt if POCA was withdrawn. But there is hope on the horizon – an early day motion supporting POCA has attracted 386 signatures from MPs, making it the most supported such motion in this parliamentary session. There is clearly a lot of support for the Post Office network in the media and in politics, with many acutely aware that post offices are a crucial lifeline for vulnerable people across the country, as well as a well-respected provider of services for the general population. It seems unlikely that the network will be allowed to decline without further measures being taken by politicians, newspapers or representative groups such as the National Federation of SubPostmasters (NFSP). Closures and grants Nevertheless, four years ago the Government decided to close some 3,000 urban post offices. To soften the blow, it initiated the £15m Deprived Urban Post Office Fund to improve branches in the poorest parts of the country. It also invested £450m in rural post offices, helping them to develop new systems and services and subsidising subpostmasters’ pay. Extra services There are new banking, insurance and travel services available in addition to the mainstays of bill payment, licensing, postage and the National Lottery. After a pilot in the Midlands three years ago, the Post Office now brokers unsecured loans at certain branches. New currencies have been made available at counters, making the network the largest supplier of foreign money in the country. Not all have taken advantage of the changes, but it is clear that in the right situations, and to people with an entrepreneurial mindset, they offer opportunities rather than threats. And it seems likely that more liberalisation is on the agenda. For example, the Government has already said that it is drawing up plans for employee share ownership, although it is adamant that it does not intend to privatise the network. So while optimism might not seem to be in abundance in the Post Office world, it might be the right time to bag that perfectly located Post Office, ready for the revolution that will bring one of Britain’s biggest retailers back to its rightful position at the forefront of UK communities. It is also worth remembering that Post Office services actually represent quite a small proportion of income for many more affluent subpostmasters. It can be the ‘carrot’ that attracts customers from a wide area, who actually spend more money on newspapers, confectionary or cards than on what might be perceived as the ‘core’ business activity. It is precisely this combination of stable payments from the Post Office, together with the opportunity for some income from individual business ventures, which attracts many people to the sector. The Subpostmaster According to the NFSP: “Subpostmasters are not employees of the Post Office Ltd, but act as agents contracted to provide services on behalf of the Post Office Ltd.” The Post Office pays the subpostmaster a fixed payment together with a supplement according to how many transactions pass over the counter. However, although it is quite easy to buy a post office business, prospective owners must apply for the post of subpostmaster by filling in an official application form and producing a business plan. This might all sound daunting, but the combination of a guaranteed payment from the Post Office and an income from your own business offers owners a lot more stability than most private ventures. All of which strengthens both the comfort of Government support and the potential for entrepreneurship – an ideal for many. But not everyone is suited to the job. Most subpostmasters have had a background in a customer-facing industry and are more than happy to deal with and explain complicated matters to the general public. People with experience in other retail areas, particularly banking, make up a high proportion of buyer - but some knowledge of running a business is also vital. Computers and technology are also becoming more important within the job. The Post Office prefers applicants who are both stable and mature. Running a Post Office branch carries more responsibilities than most businesses as you are legally responsible for the delivery of registered letters and giros – and, perhaps most importantly, vulnerable local people are dependent on your services. In very rural areas the branch can be the bedrock of the community. Nevertheless potential subpostmasters are provided with training before taking on the job. This takes the form of workbooks together with one or two days in the classroom. This will be followed by a day with an experienced subpostmaster and a couple of weeks of on-site training. The NFSP says a prospective subpostmasters’ business plan should include information on the following: - How the premises will be run
- Competitors
- Business hours
- Cost projections
- General business objectives
- Marketing and advertising
- Customer base
- Use of technology
- Role in local community
- Accounts
- Staffing
- Finances
- Profit budget
- Cash flow forecasts
More information on becoming a subpostmaster can be found on the NFSP website.
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