How To Open A Mail and Parcel Center Store
Your Guide To Opening A Retail Packing And Shipping Store
When we were first thinking of opening a shipping center, we had no idea where to begin. We didn't know what we needed, how to get started or who we could talk to. The very idea was daunting with no information to guide us through our new endeavor.
After some lengthy discussion we decided to go ahead and open our mail and parcel center and "wing it" as obstacles came into our path. I can remember saying to myself over and over during the entire startup process, "I sure wish there was some kind of guide, or how-to manual on "Opening a Shipping Center".
With this thought on my mind, I created a list and documented all the things we needed to do to get started, all the problems and dead ends we ran into, and what resources and fixes we found along the way.
I've put all this info together for you, so that future shipping center store owners might have it a little easier when starting their own business ventures.
How Much Will It Cost?
After our personal experience, the bare minimum I would even consider opening a mail and parcel center with is $25,000. You have to have a finish-out on the building. You need to purchase POS equipment and software. You have to buy supplies and retail displays. The list goes on and on, and I'll discuss some of the stuff you will need later in this guide.
An ideal figure to open your shipping center with would be about $60,000. Please keep in mind these figures do not include the money you will need to live on. If you will not be working another job, you need to add your yearly salary to the above figures. It will take at least a year to fully build your client base and turn the store into a profitable establishment.
Choosing a Location:
Choosing a location is THE most important factor when opening a mail and parcel store. If you have a poor location your clients will not notice you, it may be too far out of their way, or inconvenient to get to you.
If you choose to get placed in a shopping center, make sure parking will not be an issue. If you get into a suite next to HEB, Best Buy or some other big chain parking will be limited. Your customers would rather drive down the road then get out of the car and and walk all the way across the parking lot. Also stay away from the strip malls that no-one frequents. Getting the proper exposure is the key to your business.
When we opened a shipping store, we decided to go with a stand alone building instead of the shopping center approach. A larger building opened up in the downtown area of our city with the closest shipping center being more than a mile away on the other side of town.
We chose this location because it was right across from an upper middle class neighborhood, and right down the road from our industrial district. We now have accounts with the school system, the police station, several factories, and an abundance of business people that work in the downtown area.
Pick your location wisely! Drive around town and find all the other shipping centers in your city. Buy a map and mark their locations. Don’t try to compete with those stores. They are already established and have a customer base. You want to put your store near a middle class or upper middle class neighborhood, on a main road, where there is a large number of businesses you can provide direct access to.
How To Apply For Shipping Accounts
Setting up your shipping accounts is not overly difficult if you know how to get started. Be forewarned that you can not apply for your accounts until you are within 30 days of your opening date. Details are as follows:
Fedex - Fedex does not allow you to mix your business with anything else. For example, you can not run an office supply store, that also ships packages via Fedex. Also make sure when you fill out this application that you put the full business name as found on your tax ID. You can fill out your application here: http://www.fascnet.com
USPS - The USPS approved shipper program does not give you any discounts, but it does provide you with a free pick up from the post office. Even though this will not be a huge money maker for you, you need to be able to service all your customers needs. The USPS approved shipper program application can be downloaded directly from the AMPC here - http://www.ampc.org/ or through RSA here -www.rscentral.org
UPS - UPS is not currently taking any applications for new ASO's. There is a big debate about this subject and if you want more info just google on it. Basically the only way to get ASO status with UPS is to buy an existing store. We do not have ASO status with UPS and it does not hinder us at all. A little finesse can easily direct a customer towards Fedex or DHL.
What Equipment Will I Need?
To set everything up properly you could easily spend $10,000 to $15,000 on equipment for your store. You will need a POS system on your front counter. A POS system typically includes a computer, cash drawer, receipt printer, label printer, two monitors, a barcode scanner and a credit card machine. Your needs and preferences determine exactly which type of setup to buy.
In addition to your POS equipment you will also need to purchase a quality scale. Please read this article to get more info on which shipping scale would be best for you. - Shipping Scales Article
You will also need to purchase a machine to do copies and faxes. A lot of people think they need the big copiers to start with. These machines can cost upwards of 10k and have expensive service contracts. Unless you expect to pull a lot of copy contracts, and you don't have big copy centers to compete with (Like Staples) I would strongly urge you not to waste your money on this.
Now don't get me wrong, some shipping centers do well with their copy business. They have found a niche market for that, and they have built their business plan around services like that. If that is something you want to go after great, but the average shipping center does not need several expensive machines like this. We purchased a higher end all in one machine from Dell that performs quite well. Here is a link to the one we purchased: Dell Copier
What Software Should I Use?
There are several choices for your shipping software, but there are really only three that stand out of the crowd in my opinion. Postalmate, ReSource, and Shiprite. For our business we chose Postalmate. It has a great interface, built-in cash register software, and mailbox management. The other companies offer similar services, and everyone I speak with likes them just as well. It's a matter of preference, and you will need to do some of your own research on this topic to see which one you prefer. Here are a few links on this subject.
Postalmate - http://www.pcsynergy.com/
ReSource - http://www.resourcesoftware.com/
Shiprite - http://www.shiprite.net/
What Retail Displays Should I Have?
Again, this is a topic mostly based on preference. There are many different types of displays you can purchase with prices ranging from a few hundred dollars to a few thousand. The most common types of displays are Gridwall, Slatwall, and Gondola Isles.
Trio Display - I've found this website to have just about everything you could ever need. They have a large selection of retail displays, and some of the lowest prices in the industry.
Goldline Greeting Cards - Make sure to get a good selection of greeting cards. Many people will buy these to include in the packages they ship. Once they know you have them, they will keep coming back for their local family too. A good selection of greeting cards drives repeat business.
What Supplies Should I buy?
Boxes: The most common supply you will use, and also the one you need to have the most of. We carry more than twenty different types of boxes, and I strongly encourage you to get a good inventory going when you open your shipping center. Here is a list of some good sizes to purchase when starting up your business. You can adjust the list as you see fit:
Tubes: We have several customers that regularly ship documents with us, and purchase tubes. Architects and home builders will appreciate you stocking these items. A larger tube is also great for shipping items like fishing poles or standing lamps. We carry four sizes of tubes:
Tape & Dispensers: It's always a great idea to have several tape dispensers. They break or get misplaced quite often, and you don't want to be searching for your tools with a customer standing at the counter. Also make sure to get the good tape. Some companies sell the 1.5 mil and the 1.7 mil. These break easily and are not very reliable. Try to get 2 mil or thicker tape.
Fillers: To pack items correctly you need several types of fillers. Bubble Wrap, Kraft paper, Peanuts, and Foam. Here are some tips when purchasing your filler supplies:
· Get the anti-static peanuts. They usually do not cost any extra.
· Get a peanut dispenser that hangs from the ceiling. This will save a lot of time.
· Get a big roll of bubble wrap, and a pull dispenser to hold it.
·Get a dispenser and some big paper rolls.
Secondary Money Makers:
One of the most important parts of opening a mail and parcel center is your secondary money makers. The more services you offer, the more customers you will attract. People just love to get everything done in one convenient place.
Notary - A very good business to get into. You can make a good profit on each transaction with very little work. Become a Notary Here
eBay Consignments - Our eBay consignment business has blown up. We have actually had to hire a new employee that does nothing but write ads for the amount of consignments we take in. All we do is run an ad in the classifieds section of the local paper every day, and we generate $2,000 to $4,000 in commissions each month. http://www.ebay.com
Passports - Another way to bring in extra money. A setup for taking passport pictures usually does not cost more than a couple hundred dollars, and you can charge up to $15.00 for each customer you get.
Copies & Faxes - Customers have come to expect these kinds of services from a shipping center. Make sure you have a reliable way to make copies and send faxes. This is a decent way to make extra money, and get your customers to keep coming back into the store. Make sure to include legal paper in your supplies list for copies.
AMPC / NPC - By far the most valuable resource available to the mail and parcel industry. If you are going to open a shipping center, you are strongly recommended to join this program well before you open your store. There is a wealth of knowledge here that can answer just about all of your questions.
Hot Talk - This is a discussion group formed by the AMPC where store owners discuss problems and related issues they face on a daily basis. I read these forums a few times a week and I've lost track of the amount of good info that comes from this forum. You can join the Hot Talk forums once you have joined the AMPC.
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