Right time, right service
Thursday, 21 February 2008
Last Updated: Thursday, 21 February 2008
By Amita Tandukar
For Pack & Send founder Michael Paul, the key to finding new revenue streams was going back to basics: Listen to your customers.
When Paul started the Pack & Send logistics franchise in 1993, the internet was hardly understood as a communication tool, let alone a business tool.
Few people could have predicted then the potential of the secondhand goods exchange market that was uncovered by websites such as eBay. Today it is estimated one in three adult Australians has bought or sold a product on eBay.
Targeting online sellers who send unpackaged, odd shaped or fragile objects delivered 25% of Pack & Send’s $30 million annual revenue in 2006-07, and helped the chain achieve 20% sales growth compared to the previous year.
An early challenge for Paul was finding where Pack & Send could fit into the internet business model, which was gaining plenty of attention during the dot-com boom of the late 1990s.
Paul relied on the existing customer base to guide his approach. He heard from franchisees that customers were appearing to post items sold on eBay. “The first wave of goods being sold [on the internet] were new, so they were already packaged and that didn’t interest us, but once secondhand goods started being sold we knew that there was an opening,” he says.
Paul approached eBay Australia in 2001 and formed a partnership to include a link to the Pack & Send website on eBay help pages. “They were happy to meet us halfway as they saw it as a way to generate sales,” he says.
The most popular items shipped by online sellers through Pack & Send in 2008 are motor vehicles, musical instruments, electronic items and sporting goods. The company also identified several other sites with similar products, such as general auction site Oztion and commercial auction listings such as Grays Online.
Pack & Send has an increasing number of competitors. Smart Send is an Australian company targeting low-volume eBay sellers (but it will not send unpackaged goods).
And there are eBay consignment stores, like SimplySold founded by dstore founder Danny Gorog, which deals with goods dropped off for a service fee. Isoldit, a franchise chain started in the United States, is set to open stores in Australia shortly.
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