Independent Postal Centers Winning Stamp of Approval
Wade Davis knows that the key to his business is location.
“We’re strictly in high-rise office buildings,” Davis said, speaking from his office at Century Park East in Century City. The tower provides plenty of customers for one of four private postal centers operated by Davis’ Stellar Communications.
Just as private industry created alternatives to the U.S. Postal Services’s delivery system, entrepreneurs have created an alternative to the post office for receiving mail, buying stamps and shipping parcels. Private postal centers, which grew out of a shortage of Postal Service post office boxes for rent, are growing in number and have become a hot topic in these days of rising postal rates and shrinking postal services. But they don’t compete with the Postal Service. Rather they are middlemen--sparing consumers the headaches of standing in long Post Office lines, or the worry about how to get little Susie’s hand-made vase in one piece to grandma in Des Moines in time for her birthday on Friday. Some centers will tell clients by phone if they have mail.
They are primarily small, storefront businesses, but the entities are getting larger and more sophisticated. Mail Boxes Etc. USA of San Diego is a franchise concern that is likely to top $10 million in revenue at the end of its fiscal year this month. It now has more than 600 stores operating in 40 states and expects soon to reach 1,000. Stellar Communications centers produce revenue of more than $1 million a year, Davis said.
“We are to the Post Office what the 7-Eleven is to the major supermarket. Our business is convenience,” said James W. Baer, executive director of the Assn. of Private Mail Receiving Agencies, a trade group based in Albuquerque, N.M. Patrons of private centers pay more for stamps (purchased at the regular rate from the Post Office) and to rent post office boxes. Mail Box Etc. boxes charges $10 to $25 a month, compared to $22 a year at the Post Office. But unlike the Post Office, the private centers have longer hours, including Saturdays, and offer 24-hour access to mail.
Baer’s association counts 3,000 companies as members, but he estimates that the total number of private postal centers is between 3,500 and 4,000. There are also lots of terms that could describe the businesses, Baer said, but he cringes at the term “mail drop”--a description that often conjures up images of people who operate mail order businesses selling Arizona beach-front property. “We don’t have a part of that,” he declared.
There are about three dozen private mail centers in the Los Angeles area. They range from answering and secretarial services to multipurpose centers such as Stellar Communications. Though the centers’ postal services have gained the most attention recently, many of the establishments are more like small business service centers. Box rentals now account for only about 10% of the business of most centers because the shortage has eased considerably. “We receive mail. We are the middleman for all of the overnight (Federal Express, United Parcel Service, etc.) business. We do a consolidation of air freight,” Davis said. Stellar Communications’ centers also provide same-day messenger services, facsimile transmissions, parcel packaging and copying among other services.
Some postal centers offer word processing and secretarial services and passport photographs.
The ideal center serves individuals and businesses, Baer said. It offers all of the above services, he said. Also, he said, “it is located in a strip shopping center in a very upper class part of town . . . there are only two competitors within two miles and it is a corner property where 49,000 cars a day go by the intersection.”
