How do you get a parcel from Albury to Brisbane in a hurry? Domini Stuart reports on two companies whose delivery services are driving business for their franchisees.

It may not be the most glamorous franchising sector. ItÕs certainly not the largest — courier, mail and packing accounts for less than one per cent of AustraliaÕs 1100 business format franchisors. Yet, over the last few years, two businesses from this area — Fastway Couriers and Pack & Send — have been frequent winners of both national and international awards.

Fastway CouriersÕ 39 franchise and industry awards in Australia and New Zealand have included three coveted Franchise System of the Year titles.

Meanwhile, Pack & Send followed its 2007 Australian Franchisor of the Year award by being placed equal second at the 2008 International Franchisor of the Year ceremony in Singapore — an achievement which establishes it as one of the top three franchises in the world.

For potential franchisees, these two successful systems also demonstrate the range of entry points and opportunities available within the sector.

AustraliaÕs largest courier operators Fastway Couriers started operating in New Zealand in 1983 and became the first transport company in the world to franchise. Now the single largest courier operator in Australia, the business also has franchises in New Zealand, Australia, England, Scotland, Wales, Ireland, Northern Ireland, Germany, Spain and South Africa — more than 120 regional franchisees and 1500 courier franchisees across the world. The groupÕs annual turnover last year was $441 million.

Founder and chairman of Fastway Couriers, Bill McGowan, identified and filled a niche in the market. He also credits simplicity and staying focused as significant factors in his success.

“We designed the service to be price competitive and transparent,” he says. “Using prepaid colour labels for different destinations makes it easy for both our couriers and their customers. As our franchisees own their own business, they also identify strongly with the business community. Other business owners respect and appreciate our value and consistent, friendly service.”

Fastway Couriers offers two types of franchise opportunities. Regional franchisees tend to be experienced business operators with proven people skills. As owners of the depot from which courier franchisees operate, their role is to provide leadership and motivation along with administration, IT and sales and marketing support.

The courier franchisees are the hands-on drivers who provide a local, short-haul and national service throughout Australia. For this type of franchise no specific skills or experience are needed beyond a friendly and outgoing personality.

“A Fastway courier franchise is a total business package to help you go into business for yourself but not by yourself,” says McGowan. “We provide a minimum two-week induction program plus full administration and marketing support as well as updated manuals and regular ongoing training. Courier franchisees are also trained in the Fastway saturation marketing techniques to help them grow their courier business rapidly. Years of experience have shown that enthusiastic, outgoing and ambitious people who follow this system can develop high-turnover businesses quickly.”

Anything, anywhere

From a single store which opened in 1993, Pack & Send has developed into a network of over 90 outlets across every state in Australia. In July 2008 the business took its first step towards a global presence by signing international master franchise agreements in New Zealand and the United Kingdom.

“Over the past 10 years a relatively high proportion of Pack & SendÕs freight jobs have involved export to the UK and New Zealand, so it was only natural for us to extend the development of our retail network into these countries,” says Michael Paul, founder and CEO.

“Our vision is to establish a global footprint of Pack & Send stores; we have registered our trademark in over 50 countries throughout the world.”

Pack & Send stores are designed to be the shopfront of the logistics industry. Customers, including businesses of all sizes, eBay buyers and sellers, tourists and householders, can either drop off their items or parcels to a local store or have them collected from their home or office. Pack & Send packages them if required then organises delivery to any destination in the world.

“Our freight solutions range from sending a 20 gram letter to a one tonne consignment,” says Paul. “We also offer over 30 different freight services which enable us to deliver to any destination on the planet. We sell packaging supplies and can custom pack items of any size or weight — we are the industry leader when it comes to handling goods that are fragile, large, awkward and valuable.”

Paul believes there are no limits to the success that can be achieved when a motivated team is totally focused on the customer. A system known as Store Connect supports this philosophy — it enables individual franchisees to work together to accomplish tasks that might otherwise be impossible. Some of their success stories have been brought together in a book, No Limits — true stories about going the extra mile.

Typical examples include a customer who wanted a fragile ornament picked up at 10.00am and delivered to Perth by 5.00pm on the same day; one who needed PCs, monitors, printers, fax machines and servers to be packed and returned to one location from a dozen sites across Australia; and another who wanted a shipment of display equipment to be packed and delivered to an exhibition event venue in a different state then packed and returned a week later.

The new stores in New Zealand and United Kingdom are the first stages in a plan to make Store Connect solutions available internationally. PaulÕs long-term vision is to connect the world — and he believes that continuing changes in the logistics industry are playing to the companyÕs strength.

“More goods are being moved than ever before,” he says. “The growth of trading through online sites such as eBay has been phenomenal. Hundreds of millions of products and goods are bought and sold on eBay alone every year and all those goods need to be packed and shipped.

“The future is very exciting for logistics companies with the necessary resources and business systems to take advantage of these changes. Pack & Send caters for this new demand — over the past 15 years we have carved out a strong niche market position and the long-term industry fundamentals are very favourable to our business model. Our unique retail packaging and freight forwarding services are simply giving the market more convenient and personalised solutions to move things around the world.”

As with many fast-growing franchises, Pack & SendÕs biggest challenge is finding enough quality franchisees to establish stores in strategic locations.

“In many areas of Australia we have more customers than we can service with our current network of stores,” Paul continues. “This can have a deleterious affect on the brand. We have recently embarked on a strategy to expand our numbers of company-owned stores to meet this demand.”

Investment and return

Essentially, both of these systems are providing the same service — getting something from one point to another on deadline and intact. Yet the opportunities they offer to a would-be franchisee are very different.

Becoming a courier is one of the cheapest ways into a franchise — within the Fastway network exclusive territories start from as little as $25,000. Many of these come with an income guarantee and the average franchise turnover from July 2007 — July 2008 was $198,000 per annum.

There are no ongoing franchise fees and the franchise agreement is unusual in that, for both courier and regional franchisees, it is for life — it never expires and no renewals are needed. This means the franchise territory is an asset which can later be split or sold for a capital gain.

It is also very easy to become a courier for anyone who can afford it.

“In some cases, you can literally look at a franchise one day and buy it the next,” says Owen Wright, a lecturer in the Asia-Pacific Centre for Franchising Excellence at Griffith University.

Studies have shown — not surprisingly, perhaps — that people who take the least amount of time to make their decision are the ones most likely to be disappointed. As with any investment, potential courier franchisees are advised to take their time in considering every aspect the job and making sure they understand exactly what it entails.

ItÕs also important to take personality, motivation and even health into account.

“ItÕs a mistake to look at a friend or family member who is doing really well as a courier and assume you could be just as successful,” says Wright. “That might be particularly easy to do if youÕre in a situation where youÕve either left or lost a job and are keen to get working again. But the reality is that not everyone enjoys being a courier and not everyone will be good at it.”

Some people who go on to be successful franchisees were originally motivated by the desire for a different lifestyle. They may have been tied to a desk or workbench and felt it was time to become more active. They may have been attracted by the freedom that comes with being your own boss. They may even have been looking for an opportunity to escape the city.

For instance, Steve Taylor and his wife Julie were living in Sydney when the lure of a rural lifestyle inspired them to set up the first Fastway courier franchise in Central West NSW. TheyÕre now building their business from the comparative peace of a farm in Mudgee.

A good franchisor will provide the information you need to make a thorough assessment of the job and plenty of time to make your decision. Along with free opportunity seminars and information packs, Fastway encourages discussion between potential and existing franchisees. There may also be an opportunity to try the work before you commit — which would be particularly reassuring if you have any doubt about your ability to handle the hard work and physical demands.

By contrast, Pack & Send is a retail-based outlet with a traditional fixed term — in this case, 10 years with a 10 year option. The estimated initial investment for a Pack & Send franchise is $185,000 including working capital.

“This is a relatively low investment for a retail business, and thus our profits provide a very attractive return on this investment,” says Paul. “Pack & Send franchisees have experienced excellent income and capital appreciation benefits. High profit returns have resulted in a growing trend of franchisees acquiring their second, third or fourth stores. Currently, over 25 per cent of the Pack & Send network is under multi-store ownership.”

Pack & Send has identified 17 key attributes to franchisee success and all franchisee candidates are rated against these criteria. They include computer literacy, family and social support, service orientation, drive for success, sales orientation, openness to growth, communication skills and an optimistic outlook.

“We believe the cornerstone of our success is the team of people behind our brand,” says Paul. “These are the franchisees who have enthusiastically embraced our Ôno limitsÕ culture with a commitment to Ôgoing the extra mileÕ for their customers.”