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PostNet Franchise Review (2019)

PostNet Franchise Review (2019) 

Franchise Background

Founded in 1985 with franchise operations beginning in 1993, PostNet printing, marketing, and design franchises help small and medium sized businesses thrive by offering convenient and professional printing and shipping services PostNet is a business-to-business franchise that directly serves the over 27 million small businesses in America today. Evolving from their early days as a pack, ship and print franchise, PostNet Centers have grown well beyond that to becoming a valuable resource for small businesses PostNet Neighborhood Business Centers also provide strategic marketing support to help small businesses improve or optimize their customer acquisition and retention campaigns PostNet’s Products and Services: Graphic Design/Branding Direct Mail, EMail Marketing, Print Marketing Materials, Signs, Banners, Trade Show Graphics, Custom Websites/Mobile Sites, Fleet/Vehicle Graphics, Shipping/Packaging/Logistics, PostNet 24/7/365 Online Print Center, Forms/Labels/Stationery, Finishing/Document Services

Management Team

With over twenty years combined experience in the postal and business services industry, PostNet’s founders Steven Greenbaum and Brian Spindel launched the PostNet franchise program in July of 1993 and never looked back. PostNet International Franchise Corporation has become the fastest growing, largest privately-held company in both the postal and business services, and copy and print shop industries. PostNet’s franchisee-inclusive culture and open communication channels have enabled us to develop a powerful and competitive operating system fueled by the energy and enthusiasm of their franchisees, employees and customers The  founders attribute PostNet’s initial and ongoing success to the hard work and efforts of their franchisees and the company’s unwavering commitment to its culture, core values and passion for the business. It’s a single shared vision of success that inspires each and every member of the PostNet family to help each other thrive  

Franchise Business Services Industry Analysis

Franchise Strengths

-Established brand and business concept that has been franchising since 1993

-Offers variety of services to businesses and consumers, including both the printing, marketing, and design side as well as the shipping side

-B2B concept which allows for more recurring revenue streams

-Franchisor provides strong training and support

-Strong gross profit margins

 

Franchise Weaknesses

-Competitive retail landscape competing against both nearby brick-and-mortar locations as well as online competitors

-Slightly declining net unit growth in the U.S. in 2014 and 2015

-Quality of operations and service seem to be primary competitive differentiators

 

Business Services Franchise Opportunities

-The three industries in which PostNet operates — printing, marketing and shipping — have a combined value of more than $380 billion in the U.S.

-In 2013 more than 17 million Americans identify themselves as either self-employed or as an “independent worker”, with the number expected to grow to 24 million by 2018

-Over 28 million businesses in the U.S. with fewer than 100 employees

-The number of small businesses in the U.S. has increased 49% since 1982

Threats in the Business Services Franchise Market

-Profitability can be negatively impacted by close location of like competitors

-Business must continually adapt to an evolving B2B services market

-Online B2B service providers operate with different cost structures that enable them to react faster / disrupt the market more so than brick-and-mortar businesses

PostNet Franchise Cost (2018 FDD)

Estimated Initial Investment and Royalties

According to Items 6 and 7 of PostNet 2019 FDD

Historical Revenue for PostNet

FDD Disclaimer: “This Item 19 provides certain historical data provided by our franchisees. We currently have 209 Centers in the United States operated by 201 franchisees across 39 states which have been in operation for an average of 14 years (see Item 20). These Centers offer products and services to both consumers and business customers. The following tables provide information about the sales performance of those Centers that have been open for more than 12 months. Written substantiation of the data used in preparing this information will be made available upon reasonable request.

For purposes of this Item 19, “Gross Sales” has the same meaning as defined in the Franchise Agreement. It means the aggregate amount of all sales of products and services, whether for cash, by check, credit card or trade or otherwise, made or provided at or in connection with the Center and including any sales made at a Facility or pursuant to a Facilities Management Agreement (whether or not the Marks are used in the operation of the Facility). “Gross Sales” also includes monies derived at or away from the Center by a franchisee including the sale of products or services in connection with the placement or servicing by the franchisee of self-service digital operating equipment. The term “Gross Sales” does not include: (1) any federal, state, municipal or other sales, excise, service, or value added taxes that a franchisee pays or accrues; and (2) discounts allowed to customers on sales.”

“The Centers table below lists the annual Gross Sales information reported by 193 Centers that have been in operation in the United States for 12 months or more as of December 31, 2018. These 193 Centers reflect substantially the same U.S. geographic distribution as disclosed in Item 20. The table excludes data from 16 Centers that i) were not in operation for all of the 2018 calendar year; ii) were a PostNet Express; and iii) were legacy Centers allowed to operate under PostNet branding other than the marks which are the subject of this offering, such as “ShipNet.” we have also excluded a single Center which we do not believe to be open during regular business hours as required by our system standards, and which is therefore not representative of the offering.”

Table 1: Centers Open and Operating in 2018 for 12 Months or More

Some outlets have sold this amount. Your individual results may differ. There is no assurance that you’ll sell as much.

According to Item 19 of PostNet’s 2019 FDD

Interested in Seeing how PostNet compares to other Business Services franchises?

Download our Business Services franchise guide below!

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