An enviable position

A staunch advocate of franchising as a business model, the founder and CEO of innovative freight and logistics company PACK & SEND, Michael Paul, is an Australian entrepreneurial success story.

Michael Paul Pack Send On Franchise Buyer

Established in 1993, PACK & SEND provides value-add courier and freight solutions, reselling the services of major carrier brands through a network of retail service centres and online. With 140 stores across Australia, the UK and NZ, and an e-commerce presence, the company turns over about $82m a year. 

Its customer base ranges all the way from corporations such as Qantas, Virgin Australia, Fuji Xerox and BHP, through to online sellers, SMEs, tourists and university students wanting to send a package home.

Like a 'Flight Centre' for the logistics industry

Michael reckons it’s a bit like a Flight Centre for the logistics industry. “Customers can come to us and we’ll find the most convenient and cost-effective solution to send anything anywhere — or receive anything, we do a lot of import work, as well,” he says. “We’ve got the ‘visit, call and online’ options like Flight Centre and have prospered and grown by being flexible and identifying gaps in the parcel and freight market that bigger organisations can’t service.”

Michael had his Eureka moment 26 years ago when trying to send a computer from Sydney to Melbourne only to discover no-one would pick up unpacked goods. Even when he packaged it up himself, carriers weren’t interested in dealing with individual items. 

That experience got him thinking. His research led him to the US business model of convenient retail outlets where people could drop off items to be packaged and sent. He realised such a set-up would benefit not only the customer, but also the courier company, which could pick up a consolidated job lot of parcels rather than going to individual places to pick up one package. The first PACK & SEND store in Parramatta in Sydney proved the model worked.

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The e-Commerce wave

At the end of the decade, the emergence of eBay changed everything. As an early adopter, PACK & SEND was in the box seat to ride this new wave of e-commerce. 

“With the internet, there was this proliferation of goods being sold online and a lot of it had to be packaged up,” says Michael. “There was a lot of large, awkward stuff being sent and no-one knew how to pack it. We were well poised to service that market. Then when eBay came into the marketplace to fuel that growth, we started expanding our franchise network.”

Michael adds that PACK & SEND had no time to sit on its laurels, setting in train a digital transformation of its business model. “We’ve had to continually adapt and evolve and that’s why we’ve continued to grow,” he says.

 “Today we’re very much a technology-enabled company. If customers want to send a pre-packed parcel, they can go online, get a quote, pay and we’ll have a courier pick it up from their door. We can also integrate into the shopping cart systems of companies such as Shopify or eBay — and we make it easier for people to sell product online by having their systems integrated into ours.”

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Alternatively, customers can drop off a parcel at their local PACK & SEND outlet. There are 110 stores in Australia, 18 in NZ and 18 in the UK. “That retail network has become critical to e-commerce parcel delivery,” says Michael. “Because we act as an alternative delivery point — we receive 125,000 parcels a year for people who aren’t home when the courier makes a delivery, for example — the customer can pick it up at their local store at a convenient time.”

He says the outlets are also becoming fulfillment centres for e-commerce sellers. Many of these are small businesses that initially store product in a garage or self-storage facility and do all the packing and dispatch themselves. When this becomes unwieldy, PACK & SEND is able to fill the gap. “That’s probably one of the biggest trends at the moment with so many businesses selling product online. It’s all being outsourced to companies like PACK & SEND that have systems in place. We handle it for them so they can focus purely on selling their product.”

Amazon App On Franchise Buyer

Michael doesn’t see logistics giants such as Amazon as competition in the e-commerce fulfillment market because they tend to cater to large-volume organisations. “There’s so much business out there and we’re really well suited for SMEs,” he says, noting that some big players, operating from a single mega warehouse, choose to still use PACK & SEND services for “micro-fulfillment”. 

“For example, an Amazon or any other big player might want to be able to deliver their product within an hour or two of it being ordered online. We can put their product in our network of stores and when customers order it online they can either collect it or have it delivered through one of our fast courier services. This micro-fulfillment offering is a big point of difference, a unique thing we have in the marketplace.”

Freight changed

The next game-changing shift for the business came with an awakening in the way the world saw online buying. Despite all the hype, and significant volume of sales, eBay had yet to become a mainstream activity. But by 2012, retailers were seeing its impact and courier companies were noticing a massive shift in the profile of the freight they were carrying. 

Suddenly, the bulk of deliveries were not to businesses, but to homes. “That was another opportunity for us to play an important part,” says Michael. “We could see where the market was going so embarked on a significant digital transformation to our network. Over the past four or five years, we’ve invested $5m in technology and capital investment to ensure our franchisees can offer the right services to customers and have the technology for ongoing strong growth.”

Michael says that ongoing strong growth, with a demand for at least another 45 retail outlets in Australia, is a big plus for his franchisees. “We have enormous amounts of customer leads,” he says. “We give our franchisees a ‘first-year brand lead guarantee’ as a startup. That you’ll get brand leads, which, if converted at the current rate of our franchisees, is equivalent to $140,000 of gross profit.” 

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Growth in a challenging time

Michael reports that the business delivered record breaking global system-wide sales during the pandemic - in excess of 30% for the six months ended December 31 2020. “Ecommerce has always been on a growth trajectory, and the pandemic has resulted in growth that was anticipated over a few years occurring much earlier. Our strong growth is a consequence of the strategic course we set before COVID-19, which includes over AUD $5.2 million in technology investments. Essentially the market has accelerated to meet our existing strategy”, said Michael.

PACK & SEND’s franchisee training is comprehensive — two weeks in-class training at head office and two week’s practical training in stores before they can open up their own franchise. Michael says the focus is on interaction with the customer.

“We go through a detailed franchisee selection process, but they have to bring to the table this level of customer intimacy because that is a point of difference we offer in the marketplace.” 

It must be working, he adds, because on the Product Review website, PACK & SEND is the highest-rated courier service company in Australia with a rating of 4.5 out of five. “Our franchisees go the extra mile as owner-operators to give this exceptional level of service and that’s part of our culture. We provide this fantastic business system in the form of technology and buying power, but they bring this great level of customer service with the business model.”

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According to Michael, e-commerce can only get bigger, which means more and more parcels into the system every year. “We need to innovate and adapt to ensure we’re on top of the trends and ahead of the game,” he says. “We’ve grown every year for 26 years and seen a lot of companies, big brands such as Toys r Us, disappear in that time. That growth has come from us predicting where we believe businesses will spend their money in the future.”

He sees one of those places as fulfillment, which he believes will be massive. “All these small businesses selling things online will become a mainstream activity and they will outsource the whole process. A lot of our investment is around gearing up our franchisees to capitalise on that.”

"Franchising done well works for everyone..."

As a former chair of the Franchising Council of Australia and an inductee into its Hall of Fame, Michael’s involvement and enthusiasm for the industry runs deep. 

“Franchising done well works for everyone — franchisee, franchisor, customers and suppliers,” he says. “It’s a brilliant model and our brand is testament to that. We’ve got more and more franchisees putting up their hand for their second or third store. I love it because you’re always helping people. You’re providing a solution for your customer, you’re helping people get into business and prosper and grow, and you’re helping your staff develop and mature as seasoned executives.”