Home | I wouldn't buy it | UPS Store Numbers

UPS Store Numbers

Interesting nuggests of information about the UPS Store outlets…

Since the acquisition, a UPS spokesman says, overall sales have grown “impressively.” The company doesn’t break out results for its retailing chain. But sales data reviewed by The Wall Street Journal show that domestic UPS Store outlets averaged about $295,000 in revenue last year. Five of the stores had more than $1 million in sales subject to royalty. That number excludes the sale of stamps and other postage and some weekend delivery charges. Mr. Mathis adds that same-store sales, a key indicator, rose last year.

As for capping prices franchisees can charge, the company says it did so because “our research showed that the high rates franchisees were charging simply didn’t sync with what customers were willing to pay.” Customers also found differences from store to store confusing.

Hat Tip, as usual: Paul Steinberg in the forum

While I can understand that pricing consistency is an important marketing tool, it hasn’t hurt McDonald’s or other fast food franchsies that drift from the menu and $.99 specials often. It would be clever for the UPS stores to try and open up “eBay drop off” concept and co-brand it….similar to Dunkin’ Donuts, Baskin Robbins, and Dunkin’ Deli. It would generate a lot of PR, drive business, and reposition the brand as a high-tech, small business friendly store.

About Ryan Knoll

Attorney and advisor with an interest in franchising. Feel free to email me comments and questions on the "Contact Us" page.

16 comments

  1. I don’t think people expect pricing consistency anymore. What UPS should do is offer the lowest price if people print their label and pay online, and then schedule a pickup or drop it off at the store. And then let the stores set their own prices. If stores charge too much, they’ll get less customers because people will just print the postage online.

  2. I think that the response by Mathias may have been an earnings claim, which also misleading because it does not describe the typical franchisees experience. Interestingly, under the new proposed biz op rule by the FTC, the definition of an earnings claim is enlarged significantly.

  3. Anyone considering a UPS Store franchise needs to have their head examined. As a 10 year veteran of dealing with UPS as a MBE store owner and a UPS store owner I can promise it isn’t what it appears to be. You will be in dept with little hope of ever getting your head above water. In essence you will be buying yourself a minimum wage job for about $250,000. UPS will rob you blind and then take your last dollar if you try to close your store.

    Opening a UPS Store will be the worst and most regrettable decision of your life !!!

  4. Anyone who thinks they want to own a UPS Store just needs to read the comments on the various websites which address this issue. Overwhelmingly owners claimed to have been robbed, cheated and treated like indentured servants by UPS. You are not their partner, you are simply a revenue source for them in terms of providing a location, labor, insurance, utilities etc for their drop off business. You do the work, they make the profits…

  5. Michael Webster’s comment about the UPS Store same store sales growth is correct. The sales growth only indicates that the individual store are not losing as much as they did earlier. This growth does not address the issue of the store actually turning a profit.

  6. Anyone who believes anything from The UPS Store people is an idiot. I look at 179 store results monthly and only a very few reach the numbers described in your article. Owners of existing stores say sales and profits are down. New store owners better just get thier attorneys in line for litigation. UPS is a financial terrorist!!!

  7. Stuart rots in Hell

    I closed my store after 46 months of spending, only to lose everything,
    I hope that the all go to hell.

  8. See the video… http://www.youtube.com/watch?v=6dMgO7eGXq4

    UPS to finally face the jury! Trial begins April 26, 2010. After a 7 year wait, Mail Boxes Etc franchisees will get their day in court. To show your support, follow us at http://www.twitter.com/upsontrial, Become a facebook fan of Platinum Shield Association. Did you know that at the time of the 2003 conversion, there were over 3500 MBE stores in the United States. Today there are LESS than 80!!!

  9. I have been really wanting to open a store, but I have been reading so much negative talk from many sites that I am not so sure now. It seems like such a good franchise, but it also seems as though there are so many like myself that are unsure now after reading these many negative posting. What to do?

  10. In my personal observation by reading financial data and conversation with store owners, about 60% of the stores are under performer and about 25% are losing money, even after 5 years of opening a store. About 25% of the stores make an average of $40-$60K/year net profit (including owner’s salary). Just about 10% of UPS Stores make an average of $65 – 100K net profit (including owner’s salary).
    Most of these high performers are run by the owners and usually they are in high income areas, with a 50% residential to businesses ratio in 2-mile radius. Most of these stores are also 10 years or older, have favorable rental leases and usually have paid off their copier leases etc. Most of the customers tend to be local.
    So do not open a UPS store with McDonald’s mentality and rely on traffic patterns to predict future success. Most of successful stores are again, in wealthy neighborhoods and bigger shopping centers with at-least 6-8 miles or more away from another UPS Store.
    Hope my observation and experience will help new investors who get sweat talks from area sale rep and make poor decisions. In the last two years, for every one new store opened, about 2 have closed down. In any given market, about 40 -50% of the owner is looking for a buyer, means turnover ratio is very high.
    .

    • What if I purchased five under-performing stores for $50,000 each? Each store would only need to net me $10,000 each after all expenses to give me a 20% return. Right?

      • You must be kidding. How come you will earn any money out of those stores. Just your rent, employee Salaries, fixed & variable expenses, royalties etc. will eat up your gross income and to fulfill your legal obligation to pay for those expenses, you will be digging into your savings account until you declare bankruptcy.

      • Just as you said, under-performing stores, under 50K, do not have enough sales to support even the fixed expenses.

  11. I’m working on opening a UPS franchise in south Flirida
    .pembroke pines, Davie or Plantation.did you thonk it’s a good idea..
    I’m a stock clerk at Publix super market for 4 years and still part time..I drive Uber also..making $11.80 at Publix.and about $350 to $460 with Uber..
    Trying to get a lian from SBA do you think it’s a good idea

  12. masterjude nope not a good idea just doing it what you doing it

Leave a Reply

Your email address will not be published. Required fields are marked *