When Kathy and Terry Stokes first proposed opening a PostNet franchise in Steamboat Springs, the company told them the market was too small to afford success.
The Stokes had done their homework, however. They pointed out that a national competitor's two highest-volume stores were in Vail and Park City, Utah. If a packing and mailing store could succeed dramatically in other ski towns, why not in Steamboat, they reasoned.
That was six years ago, and today, the Stokes say the flexibility allowed by their PostNet franchise has allowed them to push the boundaries of what a packaging store can be for its customers.
"We have become a part of a lot of people's businesses," Terry Stokes said.
PostNet was founded in 1993 and has grown to more than 850 franchises worldwide. Total revenues generated by all PostNet centers exceeded $150 million last year.
The highest volume store in 2002 was the Stokes' little store in the Steamboat Crossings, between downtown and the mountain in Steamboat Springs.
"Kathy and Terry continuously rank among our top three," Postnet founder Steve Greenbaum said. He added that their ability to achieve their status in the company while working in Steamboat demonstrates the size of the market isn't necessarily a limiting factor.
"It isn't about where you are," Greenbaum said. "The issue is that people understand you're there. It's about reaching and educating as many consumers as possible."
How can a store in a town of 10,000 people produce more volume that stores in larger cities?
The answer lies partially in the Stokes' willingness to listen to their customers' needs and adapt their services to meet those needs. It also can be found in their willingness to cheerfully take on their customers' emergencies.
"Mike Lomas once told us, 'You guys should change your name to 911,'" Kathy said with a laugh. "When a contractor or developer comes to us and says, 'I've got to have this job to City Council by 4:30 p.m.,' we get it done. It's like we've got a pulse on what's going on in town. It feels great."
The Stokes are no strangers to the franchise business. After meeting in Steamboat in the 1980s when both were living the ski bum lifestyle, they left for Bakersfield, Calif., where they owned and operated a 7-11 convenience store for 12 years.
"They're the grandfather of franchises, but they are extremely controlling," Terry said.
"It's almost like you're a glorified manager," Kathy agreed.
When the Stokes made up their minds to return to Steamboat, they spent several years researching the right kind of business to open. They knew their decision would not be based on emotion, but on fulfilling a need that wasn't being met here.
"We were trying to figure out what we wanted to do. But it was much more important to find out what Steamboat needed." Kathy said.
The Stokes felt Steamboat was ready for a packing and shipping store, but they selected PostNet because of the company's culture of empowering franchisees to develop and adapt their individual stores to fit the market. That philosophy has allowed the Stokes to build one of the busiest of all PostNet stores in terms of gross volume; and their enterprise is appreciated even at the top levels of the company.
PostNet's Greenbaum is in the midst of repositioning his company in the wake of the acquisition of Mail Boxes Etc. by UPS, giving the giant shipping company a true retail presence.
"Kathy is on our National Franchisee Advisory Board," Greenbaum said. "She takes a leadership role. We've known (the UPS acquisition) was coming and during the last two years we looked at our organization and asked, 'How well are we positioned?'"
PostNet reached the conclusion that it needed to evolve its brand identity and become more progressive while continuing to fulfill the traditional role of a postal and packing operation. The new direction emphasizes direct business-to-business services and production of digital documents, Greenbaum said.
The Stokes appear to be leading the charge. They obtained digital photocopiers that can handle blueprints, and do a high volume of business with architects, contractors and draftsmen.
PostNet in Steamboat maintains its own DSL Internet servers, allowing the staff to quickly download large document files from architects and graphic designers in distant cities. The 10 computers at PostNet (some of them are in the back shop) are linked to digital copiers and printers, allowing staff members to print directly from customers' files.
"We have many customers we've never met," Kathy said. "They e-mail us."
An example would be a company in Chicago whose chief executive came to Steamboat for a convention. When the executive needed 200 manuals delivered to a local hotel conference room overnight, PostNet in Steamboat simply downloaded the text and visuals as PDF files and printed out the manuals. The job was delivered to the hotel conference room in plenty of time.
The Stokes hired a full-time graphic artist, Tony Frisbie, to create promotional pieces for customers. They also have created among their eight full-time employees the position of "job coordinator" so that business customers receive the focused attention of an employee dedicated to their project.
PostNet's corporate arm helps franchisees in many ways, Kathy said. One notable example is corporate's success in negotiating attractive rates from major shippers such as UPS and FedEx. Franchisees can mark up express shipping and still offer their customers a price that is below the open rate they would get if they went to the shippers themselves, Kathy said.
More and more, the Stokes find the 550 customers they have on account are using them for short-run printing jobs, whether it be 25 business cards or 25 color posters. They freely refer jobs back and forth with more traditional commercial printing plants in Steamboat. The spirit of cooperation is based in part on the fact that PostNet's printing services occupy a different niche than the commercial printers, she said.
The Stokes rely heavily on a couple of independent local entrepreneurs. They purchase all of their copiers from Dan Roth of Advanced Copier Solutions and he maintains them religiously. Dave Koorey is on call almost around the clock to maintain their computer network.
Kathy said she was not particularly experienced with computers when she opened the business.
"I took an introductory course at CMC," she said. "Since then, it's been learning on the job. Dave has taught us so much."
On a typical Wednesday in November, PostNet was crowded with a half dozen customers, several independent building contractors among them.
Earlier in the month, the crew at PostNet had shipped 500 pounds of marketing materials to Italy on behalf of SmartWool, a Steamboat-based outdoor clothing manufacturer.
A week later, eight giant elk racks were stacked waiting for shipment to another state. A taxidermist depends upon the Stokes to fulfill his client's shipping needs.
Property management companies in Steamboat have learned that when a guest leaves a valuable possession behind in their vacation condominium, it's far easier to rely on PostNet to take care of the return shipping than it is to ask their own employees to offer the service.
The list of innovative revenue streams the Stokes have uncovered goes on.
Whether they are working with a one-man contracting business or a rapidly growing company such as SmartWool, the Stokes said they derive satisfaction from playing a role in the success of businesses all over town.
They've grown to the extent that next year, they plan to add 1,000 square feet to their back shop, allowing them to continue to expand their services.
"We're not for everyone," Terry said. "What we offer is convenient service. Our service is a good value and we can save customers money."
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