Franchise Spotlight: Mail & Courier
Typically offering a range of services, mail & courier franchises have the scale, pedigree and technology to prosper in a sector where timescales are tight.
Mail & courier franchises are about much more than packing and shipping mail to households and businesses.
Some style themselves as one-stop shops for a range of business services, including mailbox rental, virtual offices and design, print and copy. Diversifying income streams, this provides repeat business and recession-resilience.
- Franchises promise high margins, recurring revenue and recession-resilience through multiple revenue streams
- Boosted by e-commerce boom, with online sales of non-food items soaring from 11.6% to 24.1% of the total market between 2012-2017
- £21.5bn revenue industry is forecast to grow annually by 1.7%
Mail & courier franchises principally collect, sort, package, transport and deliver letters, parcels and myriad specialist items around the UK and internationally. Catering to both businesses and the public, they courier both single items and high-volume orders.
Franchises have the pedigree, brand-name recognition and tried-and-tested processes. They can, therefore, be entrusted with the delivery of large, heavy, fragile or high-value items, such as valuable art, medical supplies or classic car parts.
Some of the postal and courier industry’s most recognisable names are franchises. Pack & Send for instance is Australia’s largest exporter, while Mail Boxes Etc. boasts more than 1,600 stores across five continents.
The rise of digital communication triggered an inexorable decline in the volume of letters posted, but this has been offset by the e-commerce boom. Customers now shop online, on average, six times per month!
Research firm IBISWorld cites the adoption of new technology as a critical success factor, along with product development and accessibility to customers. When success hinges on delivering to tight timescales, innovations in GPS tracking, online customer platforms and inventory management are critical in gaining an edge.
Small wonder that start-ups struggle to break into the market without significant investment. Boasting heritage, economies of scale and processes and systems fine-tuned over many years, franchises are perhaps your best and only way into this market.
Is a mail & courier franchise for me?
Mail & courier franchises rarely require franchisees with previous experience in the postal sector. In fact, they don’t even usually require a background in business services generally.
Franchisees, which typically come from a wide range of backgrounds, are given all the training, mentoring and support they need to succeed.
One franchise simply seeks people who are “ambitious, passionate and determined individuals”. Another favours “independent, committed, positive-minded people.”
This is a business where time is of the essence. You’re handling large volumes of mail of various sizes, shapes, value and urgency.
It’s your job to give the customer the service that suits their needs and budget and to ensure items are delivered on time, undamaged. It’s reasonable to surmise, then, that you should be thorough and well-organised, as well as possessing business acumen and customer service skills.
The structure of personal services franchises
The likes of Pack & Send and Mail Boxes Etc. provide a range of services from prime high street locations. They promise high gross profit margins, low staffing levels and business-to-business trading hours.
Such mega-brands offer a range of domestic and international shipping options matching any timescale or budget, plus insurance cover for loss or damage. They are generally approved by UPS, Parcelforce Worldwide and FedEx too.
Other franchises might specialise more narrowly, for example in leaflet distribution.
World Options, meanwhile, provides an online price-comparison platform for the world’s leading couriers. Not requiring staff, vans or premises, franchisees can work from home and benefit from low start-up costs, low overheads and flexible working hours. Franchisees, who can apparently generate annual gross profits exceeding £500,000, handle enquiries and leads generated by head office.
While high street mail & courier franchises might require an initial minimum investment of between £60,000-£100,000, start-up costs for an online model like World Options are more in the realm of £30,000.
A mail & courier franchise might offer the following support:
- Help drafting a business plan and securing finance
- Help finding a suitable site and lease negotiation
- Full training, delivered online, in a classroom or in store
- Ongoing operational and business development support
- National marketing support and materials to support your own, local campaigns