PACKED WITH POTENTIAL

One Aussie industry that has thrived through the pandemic has been logistics. With in-built resilience, this fundamental service has also benefited from the mega boom in online shopping.

The upward trajectory of e-commerce has shifted dramatically. A report by management consultancy Accenture, Finding Value in Disruption, reveals that consumers who before the pandemic shopped online for one in 20 of their purchases are now buying one in six items through e-commerce.

The authors write, “Post and parcel organisations must respond quickly to the changes that retail is experiencing and offer services that meet their needs, or risk losing out on market share.”

Innovation and flexibility has been core to the franchised chains that operate within this sector. At Pack & Send, for instance, the $5.2 million invested in technology before the pandemic proved a strong foundation for the network’s record growth. “Essentially, the market has accelerated throughout 2020–21 to meet our existing strategy,” says Nicholas Woodward, country manager.

“The evolution of the Pack & Send business model, incorporating our innovative proprietary technology, together with the increased demand for e-commerce to fulfilment, has seen record sales and enabled nine franchisees since July 2020 to commence and fulfil their multi-unit franchise business goals.”

Looking ahead, the forecast is that fewer than 25 per cent of businesses will revert back to pre-pandemic models. The coronavirus report suggested a clear majority will move online – remodelling their supply chains to rely on third-party companies, like Pack & Send, to fulfil customer deliveries.

“Commerce and consumer behaviour has forever changed because of Covid-19 and that is playing to the strengths of Pack & Send, with its national network of service centres and shipping technology capabilities,” says Nicholas.

In fact Accenture predicts that by 2023, more than 50 per cent of all e-commerce purchases will be delivered from local inventory.

“A consequence of this growing trend is that a large proportion of Pack & Send ser-

vice centres hold stock for such customers offering a pick, pack and delivery solution. To service this growing demand, Pack & Send is rolling out a national micro-fulfilment solution (late 2021).”

Micro-fulfilment works with a network of small format fulfilment facilities that are close to the end-consumer, where customers can have their items delivered in as little as one hour after they place an online order.

Under the brand’s micro-fulfilment solution national customers will be able to understand their inventory in real time across the network, have the capability to transfer stock between locations and optimise their order processing – all from the franchise’s proprietary technology platform.

TRACKING A GROWTH TRAJECTORY

In the first month of Covid restrictions, courier firm Aramex reported 48 per cent growth in deliveries in comparison to the same period in the year prior. In 2021 the network has continued to experience „ The business model: Pack & Send

There are national opportunities available in all major metropolitan and regional areas.

New Pack & Send franchise investment includes: a. Initial license fees: Initial Franchise license fee – $72,000 – 10-year term, with no cost renewal option for further 10-year term. Initial software license fee – $5000. b. Service centre establishment costs:

This includes fitout, equipment, packaging supplies and other (stationery/office supplies, legal costs, uniforms, rent deposit, training, accounting software, marketing brochures and supplies). Investment ranges from $103,000 to $190,000 plus working capital.

Ongoing fees and costs include royalty, national advertising fund, technology and administration costs which are detailed in Pack & Send’s disclosure document.

Pack & Send franchisees enjoy record growth

Global system-wide sales (Australia, UK, NZ) for the financial year 2020–21 closed at $82.4 million, representing a 32 per cent increase on the prior financial year.

Franchisees can earn revenue through both active and passive income streams. Some passive income is derived from technology and e-commerce solutions: • an online “Quote, Book and Pay” system for sending pre-packed parcels anywhere in the world (domestic, export and import). The solution provides customers with a simple DIY parcel-sending solution. • an e-commerce shipping technology platform Pack & Send Live, which provides e-tailers with “real time” freight quotes for both domestic and international shipments at checkout – automating the booking process.

Pack & Send on sustainability

Pack & Send has been a signatory of the Australian Packaging Covenant since its inception in 2010, with policies and commitments to reduce, reuse and recycle packaging materials.

For instance, one small gesture is encouraging customers to dispose of non-recyclable, non-biodegradable packing materials (such as packing peanuts) at service centres for reuse.

The business is: • undertaking its first carbon life cycle assessment to thoroughly measure environmental impact in the supply chain • reviewing the potential for renewable energy at retail centres including rooftop solar • intends to prioritise and incentivise adoption of electric or hybrid van fleets once vehicles become affordable.

Aramex delivering a more sustainable future

As a global organisation operating in over 600 cities across 65 countries Aramex has operational impacts on the environment. However, it is actively committed to minimising its environmental footprint and reducing its greenhouse gas emissions through a number of different investments and projects, including renewable energy, green building, alternative fuels and operational efficiency.

“We recognise that it is our responsibility to decrease our consumption of natural resources, reduce our waste systems and use renewable and sustainable resources and energy sources,” says Aramex Oceania CEO Peter Lipinski, pictured above left.

Aramex is a signatory of the United Nations Global Compact and is committed to Goal 13 of the UN Sustainable Development Goals; Climate Action. The business model: Aramex

There are three franchise models: • Regional franchisees build the brand in their local communities, operating local depots, employing office staff and overseeing a network of courier franchisees. There are 28 regional franchises operating nationally, with limited availability. • Courier franchisees are the face of Aramex, developing strong business ties with customers as they pick up and deliver parcels in their designated territory.

There are currently more than 900 courier franchisees in Australia. Courier franchisees have the ability to grow their territory by increasing the number of customers they pick up for, or by increasing the number of parcels they collect from each customer, with the end goal of selling their business for a profit. • Courier lite franchisees provide pick-up and delivery services within a non-exclusive focused area, typically based on postcode. Enjoying many of the same advantages as courier franchisees, courier lite franchisees benefit from low start-up costs (under $10,000) and an initial three-year term, with the option to renew for two more three-year periods. Courier lite is the perfect entry-level model.

The purchase of the franchise business is the primary upfront cost. To become a courier franchisee or a courier lite franchisee you will also need a van that is less than five years old.

There are ongoing operating costs and levies. Franchisees primarily make their income through pick-up and delivery of parcels.

growth of 16 per cent on overall growth of 30 per cent in 2020.

Further acceleration of e-commerce growth in Australia presents many opportunities to enhance the integrated delivery solutions for B2C customers.

Parcel delivery has always experienced peaks and troughs around national holidays and more recently with e-commerce events like Black Friday. Aramex has shown it can handle the demands of peak seasons. The network’s Blu Couriers on-demand fleet allows regional franchisees to scale up to meet the demand of exceptionally busy trading periods, or to facilitate unexpectedly busy delivery periods for specific customers.

Aramex’s 25,000 Aussie business customers also have access to 800+ Parcel Connect locations across Australia, providing choice and convenience. The Aramex Parcel Connect service taps into a vast network of local businesses to provide a close and convenient drop-off and collection point for parcels.

With real-time track-and-trace technology and omnichannel customer service, Aramex is dedicated to keeping receivers updated throughout their parcel’s journey.

“Communication with our sending customers is a high priority. We are their delivery partner and ensure communication is seamless at all stages of the delivery process,” says Oceania CEO Peter Lipinski.

BOOSTING EFFICIENCIES

Australia Post reported that there were 200,000 more online shoppers during the Covid-19 pandemic with online sales volumes up 20 per cent on 2019, points out InXpress country manager James Buck. “Based on this growth we estimate Australians shipped more than 1 billion parcels through companies like InXpress over the last 12 months, up from 934 million parcels the prior year,” he says.

“Booming online shopping trends have driven e-commerce shipping volumes to new heights, with Australia the 11th largest e-commerce market in the world, forecast to exceed USD30 billion by 2024,” he adds.

InXpress has built its own proprietary software WebShip+, that it provides to its network of over 480 franchised freight consultants globally.

“Our customers are looking for integrated shipping solutions, whether it be express air and road freight booked through WebShip+, or directly from their e-commerce shopping cart to reach their customer as quickly and efficiently as possible.

“InXpress is meeting this market need having developed shopping cart integration from WebShip+ into leading platforms such as Amazon, Shopify and WooCommerce (as well as others) meaning store owners can access the InXpress network of global and local courier companies, through our established API’s, automating the data transfer process by booking shipments electronically.”

ADAPTING TO CUSTOMER EXPECTATIONS

Aussie companies are able to take advantage of an increased number of Free Trade Agreements that smooth the way for international movements of cargo and cross-border trade.

“InXpress franchisees help those companies book and manage their international freight requirements, ensuring their goods arrive in full and on time.”

James points to the significant demand for domestic shipping services during the last 12-18 months which has seen InXpress grow its revenue from shipping services by almost 40 per cent on 2020.

“Given we are an established network present in the Australian market for over 10 years, this is significant,” he says.

“This growth is due to deploying the purpose-built scalable WebShip+ platform solution for franchise owners and shippers, ready to cater for forecast market demand as well as the re-investment we have made in our people and technology ensuring we are as agile as the market requires us to be in order to deliver a world class customer experience.” n Business model: InXpress

InXpress operates a franchised business model where its freight consultants help their B2B and B2C customers choose the best options to suit their shipping needs from leading global and local carriers such as DHL, FedEx, TNT, UPS, Startrack and Toll.

The business has been operating for more than 20 years within the courier, parcel post and e-commerce sector where growth is being driven by the popularity of events and sales such as Black Friday, as well the introduction of ‘buy now pay later’ payment options, scalable and affordable logistics costs and enhanced delivery networks offering shorter delivery timeframes, including same day and next day services.

Business benefits include; • Low entry and ongoing costs • No inventory, warehousing or vehicles required • High passive income and an unlimited earning potential.

InXpress on sustainability

“The transport and logistics sectors are a significant emitter of carbon, InXpress does not run any fleet or own any warehouse assets, so we do not physically carry any cargo. We partner with responsible companies and global leading courier companies that both acknowledge and value the importance of operating sustainably and driving toward market leading practices in this area to reduce their footprint.”

PARTNER WITH A LEGAL PROFESSIONAL WITH COMMERCIAL ACUMEN

Franchising is an important decision for both franchisors and franchisees.

We are on hand to provide strategic, practical solutions to help you plan and achieve your short and long term goals.

Unlike other legal firms which provide legal advice piecemeal, we look at the whole picture, help you with risk management, compliance requirements to eliminate unwanted surprises.

Our principal is an Accredited Specialist in Commercial Law and has valuable in-house experience, has advised businesses for more than 25 years and understands first hand the many challenges faced by business owners.

Contact Christine Lau on (03) 9653 9203 or via email at Christine@laulegal.consulting for a confidential discussion to start or grow your business