Scottish Grocer speaks to Post Office network transformation project director Neil Ennis
BRITAIN’S Post Office network has been going through a remarkable transformation and c-stores have been at its core – extending services and the hours of availability across the UK. And, according to the Post Office, it has brought major benefits to those retailers who are taking part by attracting customers and incremental business.
The programme, backed by £2bn of government funding, means that taking on the running of a Post Office has changed from being a partly salaried task to taking up a franchised business offer, which the organisation says promises commission on every transaction from one of the best-known organisations in the country and also delivers investment in stores.
Much of the transformation programme has now been completed but where opportunities remain retailers may bid to run a Post Office in one of the two models being offered.
A Post Office Local offers a suite of services that can be run at the store’s retail till point. A Post Office Main is a larger branch which has its own designated area.
The huge changes have seen Post Office branches pop up in everything from pubs to churches but the Post Office’s network transformation project director Neil Ennis sees local retail outlets as an ideal fit.
“It really works best as a concession in a retail business typically a convenience store or CTN,” he said.
The postmaster can be an individual retailer or indeed a limited company, many chain convenience retailer are postmasters. McColl’s has 500 Post Office branches, the various Co-op societies have hundreds between them.
But by far the majority of retail Post Office branches are run by independents.
So who is the Post Office looking for, what might it cost and what are the commercial benefits?
“We’re looking for someone who is very positive about growing a post office in their community,” Ennis said.
“We’re looking for potentially longer opening hours than we traditionally had. The current models that we are running, the Local and the Main are really designed to open whenever the store is open. For the retail business what the Post Office will do is bring footfall.”
So what does it cost? Well the answer in the case of a Local can be nothing. With a Main, retailer investment is expected.
“The Local, we accept, is a small post office, the cost of creating one is typically around £10,000 to £12,000. We would make that investment on behalf the postmaster,” Ennis said.
“Let’s say a Main Post Office cost was going to be £40,000, that would be typical for medium-sized Main Post Office, we would contribute half of that.”
The Local model is designed to offer a suite of services where transaction times fit into the flow of a busy till area. The Main model with its own designated area and at least one secure screened counter space can handle those transactions plus others that take longer, such as passport checking.
“There are some tremendous benefits,” Ennis said.
“If you have a Post Office you bring footfall into your retail business.
“Some of our busiest transactions apart from mails are for cash on bank cards and that sort of thing. We have relationships with all the banks now and customers can get cash at the post office. You can then get customers to spend some of that cash at your store.
“We have independent research on postmasters telling us that their retail business is increasing tremendously because of having the post office.
“We’re seeing numbers showing 10 and 11% increases.
“That’s not true for everyone, of course, and it’s better for some. But that’s a tremendous increase for retail at a time when, particularly in the convenience sector, competition is really tough.”
He said there is significant training support up to and through the launch of a new in-store Post Office branch, there are commissions paid on every transaction carried out – from mail services, including parcels, to the selling of financial services and more, that signage was prominent for one of the best-known brands in the country, and that independent research on consumer satisfaction with the new style of Post Offices had been returning remarkable scores of 95% and more.
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