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Post office for sale

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sellickbhoy

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Jun 5, 2009
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hi everyone!

i am currently looking into the prospect of opening a shop as an extension of my existing fruit and veg box business.

i'm currently looking into a few things - such as concessions in existing stores (that are general stores but don't stock fruit and veg) a mobile van/shop and my own shop (which has a workshop i can use to make up th eboxes for delivery in the fruit an veg box service)

I'm also looking at a cafe/bistro type business or perhaps a farmshop business.

Each has it's pros and cons and differing levels of costs.

However, i have seen 2 Post Offices up for sale near me. Both have general stores attached and both have suitable workshop space too

What appeals about the post office business is that it also comes with a salary from Royal mail/Post office.

I have no idea whats involved in running a post office. I'm put off because oy keep hearing they are closing down - more and more services are electronic and/or privatised. Supermarkets opening post offices in store etc.

Anyone any general tips/advice/things to watch out for in buying a post office?

I'm pretty sure there was somone on here that had a business mostly involved in buying/selling post office businesses

cheers for any thoughts/experiences on post office ownership.
 
Good idea in theory. The more a shop/PO does, the more likely it is to survive. You need as much cross-selling as possible, i.e. punter comes into post a parcel and ends up buying a newspaper, kit-kat, lottery ticket and a pack of fags - that's really the future for small independent PO's, grocers, etc.

Yes, post offices have been closing down in droves over the past decade or so. What you need to work out is whether that will continue or whether the unprofitable/deadwood has now gone leaving a lean network that is sustainable. Who knows? You need to look at the criteria used by the Post Office when deciding which ones to close - i.e. proximity to other Post Offices etc - the ones you are looking at may be "protected" to some extent if they are attracting a high footfall and far enough away from other POs.

Have you properly considered the time it will take to run the post office and shop? Where will you find the time to make and deliver the boxes? If you propose to employ staff to run the shop, then all your PO salary will be eaten up in their wages and even then you'll have to drop everything and cover for them when they phone up sick or are on holiday. Most POs/shops are a full time job for the owner anyway, so you have to be realistic about your time and also factor in trips to wholesalers, bank, etc.

First step must be to get properly prepared accounts for the past three years from both prospective Post Offices to see if you can make the numbers stack up, i.e. whether you can actually afford to buy them and whether the profits can service the loans/staff needed. Then you need to check out as much info as possible about PO closure criteria. Then you need to think carefully about how much you can "add value" to the PO to increase its existing profits and make a "premium" for your ideas, time and effort.

Sadly, there's a reason a lot of PO's and shops are for sale - it's because they're not generating enough profit. Many have been owned for decades and so the owners have no/few loans or mortgage and may have a lower standard of living as they're accustomed to low wages. Many aren't earning the owner as much as if they were stacking shelves in Tesco - some don't even pay minimum wage for the time spent by the owner. They simply don't generate enough profit to pay a mortgage and the owner's reasonable wage and are therefore effectively unsellable except to someone with all/most of the purchase price in the bank, not needing a loan to buy, therefore only need to pay themselves and not loan repayments - there aren't many of those people about!
 
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Thanks guys

I currently work 9-5 in a regular job - and I am managing the veg box business around that. I guess I am kinda lucky in that i can work from home and that my employer is pretty flexible the hours i work.

However, the fruit and veg business is getting to the point where I only really do a couple of hours a day running it - and I still do evening deliveries. The rest of it is being handled by staff and outsourcing some aspects of it.

the couple of hours I do spend at it - is largely phone/pc based work - so could be done from a shop throughout the course of a day.

However, i am looking to grow the fruit and veg box business into a more traditional type grocers shop. OK, maybe not the type of greengrocer you can remember from when you were a kid, but maybe more of a deli/grocer, a shop that sells coffees/smoothies, fine quality local produce, maybe a coffee shop or sandwich bar, and also has a fruit and veg stall.

the workshop space in the back of the shop is almost more important as that is where the day to day guts of the fruit and veg box business would run from

I am expecting reducndancy in the next 6 months, so the plan was to replace my current 9-5 job with a new business and continue to build the fruit and veg box business.

So, the salary of a PO - could nearly replace my current salary, means i would be in situ in a shop all day, could keep an eye on the running of the other businesses from the one location.

Whilst I fully intend to work in and on each of the businesses, the liklihood is that i'll have staff working them from the outset and i will manage them. And the good lady wife will have to do a bigger shift as well.

To be honest, i think the PO would be too tying for me - it would be a full time job in itself meaning i would not devote enough time to other aspects of the business.

I also don't think a green grocer/PO mix would be ideal - a newsagent/corner shop/general store/PO would be decent enough, I think the idea of a local produce deli/greengrocer - with maybe a coffee/smoothie/sandwich takeaway bar added on would be th eway to go - or even a bistro/restaurant.

But was just interested in the idea of the PO - they are the focus of many small town high streets and most small towns are lacking a greengrocer.

Short term, i think the mobile grocer van is the way to go - then i'll think about bricks and mortar

ta
 
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I wouldn't go anywhere near a PO - very very hard work, stressful and heavily regulated as to what you can and have to do. Our village PO closed down last year and the owners couldn't wait to get out, they were exhausted trying to run the place.

I like the idea of a deli/grocers/cafe/sandwich place, reminds me of the deli-cafes I enjoyed eating at in Spain, which had a very short menu based on local meats and vegetables, plus wine from huge barrels (may not be do-able in the UK that one!) and deli counter at the front. I notice "deli platters" are popping up on gastro-pub menus so might be a good time to get involved in that trend (or fad?).
 
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PO salary is made up from tier payments + comission. Salary depends upon number of total business going through the counter. I know people who own POs ranging from £18k to £250k annual and have different staffing levels. On an average if you buy a PO with around £45k annual rem and around £350k shop trade, and employ 3 people and work part time, you are likely to make £32k net profit. This is a very vauge figure, this depends upon your individual circumstances.

You need to asses them individually. The key is to run multiple POs at the same time to earn maximum. If you buy freehold, you also acquire some property on top.

PM for more info.
 
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Someone I know runs a post office in West Yorkshire and he said its brutal, he'd love to sell up but there is simply no market for them.

His biggest complaint was Ebay sellers - he said there are multiple local ebay sellers who are sending a massive amount of post each week, but paying for all their postage costs online. So he is spending all the time processing the parcels and dealing with the customers, yet not getting a penny from it.
 
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JohnnyCash said:
Someone I know runs a post office in West Yorkshire and he said its brutal, he'd love to sell up but there is simply no market for them.

His biggest complaint was Ebay sellers - he said there are multiple local ebay sellers who are sending a massive amount of post each week, but paying for all their postage costs online. So he is spending all the time processing the parcels and dealing with the customers, yet not getting a penny from it.
Click to expand...

He simply is wrong. Accepting prepaid parcels, gets you comission. Athough not as high as a label sale, buy you do get paid for your time.
 
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Batra Ventures UK Limited said:
He simply is wrong. Accepting prepaid parcels, gets you comission. Athough not as high as a label sale, buy you do get paid for your time.
Click to expand...

Mm, maybe he just meant less money - the way he was talking he was working for free when people used those. Though wouldn't be the first time someone didn't let the truth get in the way of a good story...
 
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Umm, two spaces where you could be served through the plexiglass stuff, but he had stuff piled up in front of one so only one was in use. Not sure if that was a permanent setup, or just moving things around that day...
 
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Last news I heard about PO was that the business of benefits pension payments etc was being taken from the network and going over to paypoint..Anyone know if that is going ahead and if the government is giving the PO network other business instead?
 
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luvbusiness said:
Last news I heard about PO was that the business of benefits pension payments etc was being taken from the network and going over to paypoint..Anyone know if that is going ahead and if the government is giving the PO network other business instead?
Click to expand...

It was as of the 3rd March still going ahead, worth some 15 million a year to PO I believe.

Not heard of anything being put in place to make up for the loss to the PO.

POPS XX
 
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The only thing going away is Green Giros which are not common anyway. So not much of a loss to PO Ltd.

On a plus point RBS and Natwest are now accessible via Post Office and making PO into a fully licensed bank is underway.
 
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Batra Ventures UK Limited said:
The only thing going away is Green Giros which are not common anyway. So not much of a loss to PO Ltd.

On a plus point RBS and Natwest are now accessible via Post Office and making PO into a fully licensed bank is underway.
Click to expand...

I can use the PO to pay Halifax cheques in, which is good, as my branch is 50 mile round trip - which is RBS and NW as stated above.

POPS XX
 
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