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Mail Boxes Etc. Business Information, Profile, and History

6060 Cornerstone Court West
San Diego, California 92121-3795
U.S.A.

Company Perspectives:

Mail Boxes Etc. strives to make business easier worldwide through its service and distribution network and by delivering personalized and convenient business solutions with world-class customer service. The company's core values include caring, honesty, fairness, integrity, trust, respect, commitment, and accountability.

History of Mail Boxes Etc.

Mail Boxes Etc. is the world's largest franchise network of postal, business, and communications retail service centers. Nearly eight times larger than its nearest competitor, the Mail Boxes Etc. (MBE) system consists of about 4,300 franchise locations worldwide. The chain continues to grow at the brisk pace it established almost from its birth in 1980 and has master licenses for international franchise locations in 70 countries. From its origins as an alternative to the U.S. postal system for both sending and receiving, MBE has expanded its line of services to include mailbox rentals, packaging, shipping, copying, faxing, passport photos, office supplies, money transfers, computer workstation rental, and a wide range of other conveniences. The company's on-line business--www.mbebiz .com--caters to the small and home office market and offers an array of business services.

Company Origins

MBE was founded in 1980 by Herb Goffstein and Pat and Mimi Senn. The group was later joined by Anthony DeSio, a former aerospace executive whose resume included stints with Lockheed, General Electric, and Western Union. DeSio and his three partners envisioned an establishment at which people could conduct their postal business in an environment somewhat more agreeable than that of the typical U.S. Post Office--for a premium price, of course. They opened the first MBE store in Carlsbad, California, with an initial investment of $25,000 from each partner. Initially, the company's core business was mail box rental with 24-hour access. Among the other services offered were sales of postage stamps and wrapping and shipping of packages via independent delivery services such as Federal Express and United Parcel Service (UPS).

Franchising Sparks Growth in Early 1980s

Within a short time, there were three MBE outlets in operation. Funds for further expansion proved hard to come by, however. Since banks and venture capitalists failed to grasp the potential of the concept, DeSio and his partners turned to franchising to finance their company's expansion. The first MBE franchises were sold during the company's first year of operation and, by 1982, MBE was selling area franchises for multiple outlets. Despite the company's quick growth, squabbles arose between the partners. DeSio mortgaged his house and used his wife's engagement ring as collateral to secure nearly $900,000 in funds used to purchase controlling interest in the company in 1983.

It was not long before MBE began to evolve from a chain of surrogate post offices into a chain of surrogate offices for small business operators. Early on, DeSio realized that mail boxes and shipping made a pretty small hook on which to hang an entire franchise network. One of the first new services he added was sending and receiving faxes. From the beginning, an individual could pass an MBE postal box off as an office suite number on a business card or letterhead. Now that person was able to list the fax number of an MBE location as his or her own number. In addition, MBE could provide the cards, stationery, rubber stamps, and other business identification items that contained those numbers.

As the 1980s continued, MBE was able to take advantage of the explosion of home-based businesses in the United States. MBE outlets were able to provide tiny firms that could not afford their own support staffs or equipment with the kinds of services that larger companies had in-house. In 1984, the company formed a key partnership with the United Parcel Service (UPS). In 1986, DeSio took the company public, selling most of the 51 percent of company stock he then owned and raising about $5 million in capital to fuel further expansion. That year, MBE earned $900,000 on sales of $4.6 million.

By 1987, there were more than 400 MBE franchise locations in 37 states. Service continued to be the company's main competitive edge over the U.S. Post Office. For one thing, MBE could receive packages for rental box customers, a service regular post office boxes did not provide. In addition to simply providing a wider array of services, MBE outlets were likely to be staffed by the franchiser, whose very livelihood depended on getting customers to come back. To do that, many operators offered such conveniences as allowing customers to check on their rental boxes by telephone. By 1988, MBE stores were in 43 states and numbered more than 700. It was one of the fastest-growing franchisors in the United States and nearing the head of the pack among nonfood franchisors. Company revenue had grown to $12.4 million by this time, with after-tax earnings reaching $1.85 million.

International Expansion in the Late 1980s

MBE began to foray into international markets in 1988. This was done by selling a master franchise for all of Canada to a company called Can-Mail Inc. for a licensing fee of $500,000, plus a share of the royalties it received from its Canadian franchisees. MBE was not the first American mail center chain to cross the border, however. A year earlier, Colorado-based Pak Mail Centers had opened a store in Canada. The fact that MBE was beaten into Canada by Pak Mail--a chain a fraction of MBE's size--reflected DeSio's conservative approach to financing. His aim was to expand quickly without sinking deeply into debt and without overburdening the parent company's management or corporate structure.

By 1990, the MBE chain was more than 1,200 outlets strong, compared with only about 230 for its nearest competitor, Pak Mail. Stores were located in Mexico and Japan by this time. The company continued to add new services to its line, including electronic tax filing at many locations. As the popularity of MBE and other retail postal centers grew, the company began to agitate for a better deal from the Postal Service and private carriers such as UPS and Federal Express based on the volume of business the centers were generating for the carriers. MBE finally broke through in 1990 with an overnight carrier called DHL Worldwide. In exchange for a discount that allowed MBE to charge customers the same rate as if they had gone to DHL directly, MBE began serving as official drop-off sites for DHL.

The addition of secretarial, answering, and other services made MBE even more of a one-stop business services center by the early 1990s. The company's success spawned a wave of new competitors, with names like Postal Annex Plus, The Packaging Store, and Mail 'N More, but MBE remained the clear leader in this emerging industry, with several times as many outlets as the next largest chain. As the national 'downsizing' trend among corporations heated up, MBE was able to take advantage of the growing SOHO (small office/home office) market, which was composed to a large extent of former professional employees of shrinking companies.

Despite the growing range of services being offered at MBE stores, shipping services remained the company's core business. Whereas each outlet was able to emphasize its own strengths, it was its connection to the big shippers, especially UPS, that made MBE attractive to many potential franchisees, and franchise fees remained by far the most important source of revenue for the company. In 1991, franchise fees made up 27 percent of MBE's $25.7 million in revenue. That year the company's ongoing alliance with UPS was cemented when UPS purchased 9.5 percent of MBE's stock, with warrants that gave UPS the option of increasing its holdings to more than 17 percent over the following three years. The transaction was mutually beneficial. For MBE, it ensured that UPS would not set up its own retail network, as Federal Express had done, thereby depriving the chain of one of its biggest revenue sources. For UPS it provided a low-cost, wide-ranging distribution system that was already intact and fully operational.

As the 1990s continued, MBE took on even more roles in its attempt to become a provider of every business service imaginable. The MBE network soon began functioning as customer service or distribution centers for a wide variety of business equipment companies, which found it more economical to use MBE than to set up their own outlet systems. Among the companies that used the MBE chain in this way were Nintendo, Acer Computers, Xerox, Panasonic, Toshiba, and Hewlett-Packard. Another service the company began to experiment with around this time was airline ticket distribution. For fiscal 1992, MBE's revenue grew to $36 million, with the majority again coming from franchise fees, royalties, and the sale of supplies and equipment to franchisees. The franchises themselves, by this time numbering nearly 2,000, were generating a total of about $570 million in sales.

Continuing Growth in the Mid-1990s

By 1993, MBE was well-enough established on both the national and international levels that it was able to introduce its 'Big or Small. We Ship It All' program, in which participating MBE stores had the capacity to ship just about any item to just about any destination in the world. MBE also forged an alliance with the Staples chain of office supply superstores, giving rise to the appearance of MBE 'boutique' stores inside Staples outlets. Before the end of that year, there were more than 2,100 MBE Centers throughout the world, with more than 130 of them outside the United States. The chain was growing at the rate of about one store a day. Italy, France, the United Kingdom, Spain, Greece, and Turkey, to name just a few, were all home to MBE stores by the mid-1990s. MBE's international expansion was accomplished through the sale of master licenses, which gave a company the rights to subfranchise MBE stores for a whole country. The MBE concept was particularly appealing in countries with historically poor mail service, since customers there were generally eager to skirt the existing national postal monopolies.

MBE reported revenue of $43.7 million for fiscal 1994, a moderate increase over the previous year. Around that time, the company launched its first-ever national advertising campaign, 'It's not what we do, it's how we do it.' The campaign was supported by the creation on a trial basis of a National Media Fund, which derived its money from an additional 1.5 percent monthly charge to participating MBE Centers. Because of the program's success, the fund was made permanent in 1996, and MBE has maintained a strong national advertising presence since that initial campaign.

The company's international expansion continued to move quickly during the next couple years. In June 1995, MBE's 100th European location was opened in Paris, and by the year's end there were 327 centers operating outside the United States. By that time, the company had sold a total of 47 national licenses for foreign countries. Development remained strong in 1996 as well. Among the international areas for which master licenses were sold that year were Israel and South Africa. Italy became the second country outside the United States (following Canada) to open its 100th center. Domestically, 287 new MBE Centers were sold in 1996, as the company surged toward its goal of 5,000 centers by the turn of the century.

Market research indicated that one in five U.S. households had used MBE by 1996. By this time, the success of the MBE concept was clear even to the U.S. Post Office, which sought to win back some of its lost business by offering its own version of 'pack and ship' service. This attempt at vertical integration by the Post Office met with resistance on the part of the private postal service industry, which felt that the Post Office was competing unfairly by using money from its first-class mail monopoly to subsidize its Pack and Ship operation. In addition, shippers UPS (which by this time owned 15 percent of MBE) and Federal Express, both major allies of the mail centers, were infuriated by the Post Office's use of their logos and images in ads that they called misleading. In spite of the Post Office's counterattack, MBE remained a strong leader in the industry.

New Management, New Ownership: 1996--97

In 1996, James H. Amos, Jr., joined the company. DeSio, recovering from quadruple-bypass surgery, named Amos as his predecessor and decided to sell the business. One year later, U.S. Office Products (USOP), a company catering to the SOHO market, acquired MBE. USOP, a firm that had spent the last three years acquiring nearly 200 companies, planned to use MBE's outlets to sell its office products and services. In a November 1997 issue of Discount Store News, Jon Ledecky, chairman and CEO of USOP, stated, 'We want to make Mail Boxes Etc. a one-stop shop for the small business person. Think about all the different things that we can provide.'

Under new leadership, MBE continued to grow rapidly. The firm developed a new marketing slogan, 'Making Business Easier. Worldwide' and its 500th international outlet opened in Italy. In 1998, MBE began working with IBM Corp. and Infoseek Corp. to create MBE Online, an Internet site catering to small business owners. The new venture, officially launched in 1999 as www.mbebiz.com, offered many services designed to entice business owners to use MBE for all of their professional needs.

MBE also made a strategic move in 1998 by partnering with long-time competitor United States Postal Service. The two firms began to develop a program in which MBE outlets would offer postal products and services and eventually become U.S. Postal Service Authorized Retail Outlets. The company also made important strides in the Asian market by obtaining a master franchise license in Japan. By the end of this year, more than 3,000 MBE outlets were operating in the United States.

As e-commerce became increasingly popular in the late 1990s, MBE began to forge key relationships with web-based companies. A partnership was formed with popular web auction-house eBay and iShip.com in 1999 to provide shipping and delivery options to its members. The company also began utilizing a new point-of-sale computer system in its domestic outlets that would allow for the integration of e-commerce operations. MBE's franchise locations also received a new look as MBE 2000 was introduced to franchisers offering new in-store design and marketing tools.

Continued Growth in the New Millennium

MBE entered the new millennium with more than 4,000 outlets across the globe, making it two times the size of its next five competitors combined. The company continued to see strong growth in all aspects of its business interests. The firm's pilot program with the U.S. Postal Service expanded in markets across the United States and was well received by consumers. In May 2000, MBE and Innotrac Corp. announced their investment in Return.com, a full-service on-line return service that would allow consumers to return items purchased on-line or through catalogs to participating MBE outlets for packaging and shipping. The company also began its foray into Internet banking by teaming up with National InterBank and Juniper Financial. Under the terms of the partnership, bank customers were able to deposit checks at MBE locations.

While MBE continued to prosper, its parent USOP began to feel the financial pains of rapid expansion. In August 2000, the firm announced plans to spin off MBE. Its uncertain future did not hinder MBE expansion plans, however, and the company continued to pursue growth options. In January 2001, the firm landed master license agreements in the Dominican Republic and the Caribbean. MBE also continued to look for Internet partnerships in hopes of capitalizing on e-commerce growth. Entrepreneur magazine named MBE the number two franchiser in its Franchise 500 list, recognizing the firm as one of the fastest-growing business opportunities available. As its future with its parent company remained up in the air, MBE's success and growth appeared to remain a constant in the upcoming years.

Principal Competitors: Kinko's Inc.; Office Depot Inc.; U.S. Postal Service.

Related information about Mail

otheruses
The postal system is a system by which written documents typically enclosed in envelopes, and also small packages containing other matter, are delivered to destinations around the world. In general, government monopolies only extend parcel (non-mail) delivery to courier services, which provide express delivery.

Postal systems often have functions other than sending letters. The first documented use of an organized courier service for the diffusion of written documents is in Egypt, where Pharaohs used couriers for the diffusion of their decrees in the territory of the State (2400 BC). The best documented claim (Xenophon) attributes the invention to the Persian King Cyrus the Great (550 BC), while other writers credit his successor Darius I of Persia (521 BC) Other sources claim much earlier dates for an Assyrian postal system, with credit given to Hammurabi (1700 BC) and Sargon II (722 BC). The Hebrew Bible (Esther, VIII) makes mention of this system: Ahasuerus, king of Medes, used couriers for communicating his decisions.
The Persian system worked on stations, where the message carrier would ride till the next post, where upon he would swap his horse with a fresh one, for maximum performance and delivery speed. Claims concerning the origins of this mail system also conflict somewhat, but it is clear that an organized postal infrastructure was put in place during Qin Dynasty (221 BC–207 BC) and that was substantially expanded during the subsequent Han Dynasty. The origins of a Chinese mail system may go back to the Zhou Dynasty (1122 BC–256 BC), when Confucius (551 BC–479 BC) wrote "news of deeds travels faster than the mail."fact It may have also built on a pre-existing messaging infrastructure started by the Shang Dynasty. Today's Chinese mail system is continuous with one that was probably formalized under the Qin Dynasty.fact

Rome

The first well documented postal service is that of Rome. Another service for citizens was later added.

By the name of the stations in which mail was distributed and messengers' routes crossed, derives the Latin name of mail, Posta (originally posata or pausata = place of rest) because in these stations messengers used to rest during their voyages.fact The English term "mail" comes from the Teutonic name for the bag used by messengers.fact

Other systems

Another important postal service was created in the Islamic world by the caliph Mu'awiyya; the service was called barid, by the name of the towers that were built in order to protect the roads by which couriers travelled.

Well before the Middle Ages and during them, homing pigeons were used, taking advantage of a singular quality of this bird, which when taken far from its nest is able to find his way home due to a particularly developed sense of orientation. Messages were then tied around the legs of the pigeon, which was freed and could reach his original nest.

Mail has been transported by quite a few other methods throughout history, including dogsled, balloon, rocket, mule, pneumatic tubes and even submarine.

Charlemagne extended to the whole territory of his empire the system used by Franks in northern Gaul, and connected this service with the service of missi dominici.

Many religious orders had a private mail service, notably Cistercians' one connected more than 6,000 abbeys, monasteries and churches. The newly instituted universities too had their private services, starting from Bologna (1158).

Popular illiteracy was accommodated through the service of scribes. Illiterates who needed to communicate dictated their messages to a scribe, another profession now quite generally disappeared.

In 1505, Holy Roman Emperor Maximilian I established a postal system in the Empire, appointing Franz von Thurn und Taxis to run it.

Organization

The world-wide postal system comprising the individual national postal systems of the world's self-governing states is co-ordinated by the Universal Postal Union, which among other things sets international postage rates, defines standards for postage stamps and operates the system of International Reply Coupons.

In most countries a system of codes has been created (they are called ZIP Codes in the United States, postcodes in the United Kingdom and Australia, and postal codes in most other countries), in order to facilitate the automation of operations. Bar coding of mail for delivery is usually expressed either by a series of vertical bars, usually called POSTNET coding, or a block of dots as a two-dimensional barcode. The first scheduled airmail service took place between the London suburbs of Hendon and Windsor on 9 September 1911. Some methods of airmail proved ineffective, however, including the United States Postal Service's experiment with rocket mail.

Receipts services were made available in order to grant the sender a confirmation of effective delivery.

Mail going to naval vessels is known as the Fleet Post Office. They are used by companies with large mail programs such as banks and direct mail companies.

In 1998, the U.S. Postal Service authorised the first tests of a secure system of sending digital franks via the Internet to be printed out on a PC printer, obviating the necessity to license a dedicated franking machine and allowing companies with smaller mail programs to make use of the option. In 2004 the Royal Mail in the United Kingdom introduced its SmartStamp Internet-based system, allowing printing on ordinary adhesive labels or envelopes. Similar systems are being considered by postal administrations right around the world.
When the pre-paid envelope or package is accepted into the mail by an agent of the postal service, the agent usually indicates by means of a cancellation that it is no longer valid for pre-payment of postage. however there are certain more or less obvious exceptions to this, such as postcards, which can by their post of the identity of the sender and receiver of envelopes there are legal provisions in some jurisdictions allowing the recording of these identities.www.deccanherald.com/deccanherald/jan172006/panorama19352006116.asp (In U.S. law this only apply constitutions, such as the Mexican Constitution, and is alluded to in the European Convention of Human Rightswww.echr.coe.int/Convention/webConvenENG.pdf and the Universal Declaration of Human Rights.www.deccanherald.com/deccanherald/jan172006/panorama19352006116.asp Usually, special procedures are required in case correspondence has to be, openly or discreetly, controlled by police.

Control of private citizens' mail is called censorship and concerns social, political and legal aspects of civil rights. Even though often illegal, there have been cases over the centuries of governments illegally opening and copying or photographing the contents of private mail.www.deccanherald.com/deccanherald/jan172006/panorama19352006116.aspwww.icdc.com/~paulwolf/cointelpro/churchfinalreportIIIh.htm While in most cases this censorship is exceptional, in the military censorship of mail is routine and almost universally applied, particularly with respect to soldiers near a battlefront.

The use of mail is subject to common rules and a particular etiquette.fact Modern alternatives such as the telegraph, telephone, and e-mail have reduced the attractiveness of paper mail for many applications.

Rise of electronic correspondence

Since the advent of e-mail, which is usually faster, the postal system has come to be referred to in Internet slang by the retronym "snail mail". these new vehicles include telegram, telex, facsimile (fax), e-mail, short message service (SMS). These vehicles commonly use a mechanical or electro-mechanical standardised writing (typing), that on the one hand makes for more efficient communication, while on the other hand makes impossible characteristics and practices that traditionally were in conventional mail, such as calligraphy.

This epoch is undoubtedly mainly dominated by mechanical writing, with a general use of no more of half a dozen standard typographic fonts from standard keyboards. Long before e-mail and computer-printed letters, however, decorated envelopes, rubber stamps and artistamps formed part of the medium of mail art.

In the 2000s with the advent of eBay and other online auction sites and online stores, postal services in industrialized nations have seen a major shift to item shipping.

Collecting

Postage stamps are also object of a particular form of collecting, and in some cases, when demand greatly exceeds supply, their commercial value on this specific market may become enormously greater than face value, even after use. Stamp collecting is commonly known as philately, although strictly the latter term refers to the study of stamps.

Another form of collecting regards postcards, a document written on a single robust sheet of paper, usually decorated with photographic pictures or artistic drawings on one of the sides, and short messages on a small part of the other side, that also contained the space for the address. The fact that this communication is visible by other than the receiver often causes the messages to be written in jargon.

Letters are often studied as an example of literature, and also in biography in the case of a famous person. A portion of the New Testament of the Bible is composed of the Apostle Paul's epistles to Christian congregations in various parts of the Roman Empire. See below for a list of famous letters.

A style of writing, called epistolary, tells a fictional story in the form of the correspondence between two or more characters.

A make-shift mail method after stranding on a deserted island is a message in a bottle.

Deregulation

see also: New Zealand Post

Several countries, including Sweden (1 January 1993 www.citymail.se/Startsida_68.asp?meny=OmCityMail&bMeny=Om+CityMail), New Zealand (1998 and 2003) and Argentina have opened up the postal services market to new entrants. In the case of New Zealand Post Limited, this included (from 2003) its right to be the sole New Zealand postal administration member of the Universal Postal Union, thus the ending of its monopoly on stamps bearing the name New Zealand.

Types of mail

Letters

Letter-sized mail comprises the bulk of the contents sent through most postal services. These are usually documents printed on A4 (210×297 mm), Letter-sized (8.5×11 inches), or smaller paper and placed in envelopes.

While many things are sent through the mail, interpersonal letters are often thought of first in reference to postal systems. While still very common, many people now opt to use online bill payment services, which eliminate the need to receive bills through the mail.

Bulk mail is mail that is prepared for bulk mailing and processing at reduced rates. It is often used in direct marketing and other commercial solicitations sent by advertisers, although it has other uses as well. Other times, commercial solicitations are sent by local companies advertising local products, like a restaurant delivery service advertising to their delivery area or a retail store sending their weekly advertising circular to a general area. Bulk mail is also often sent to companies' existing subscriber bases, advertising new products or services.

Many other things are also sent as letters through postal services, like wedding invitations and bank statements.

Repositionable Notes

The United States Postal Service has recently permitted "repositionable notes" (for example, 3M's Post-it notes) to be attached to the outside of envelopes.www.usps.com/communications/news/press/2005/pr05_028.htm

Postal cards and postcards

Postal cards and postcards are small message cards which are sent by mail unenveloped; The postage required for postcards is generally less than postage required for standard letters, although the United States Postal Service has imposed a surcharge for the purchase of postal cards, over and above the required postage.

Postcards are also used by magazines for new subscriptions. to promote fair trade or third world debt cancellation).

Other

Larger envelopes are also sent through the mail. Additionally, because of terrorism concerns, the U.S. Postal Service subjects their packages to various security tests, often scanning or x-raying packages for materials that might be found in mail bombs.

Magazine subscriptions are also sent through postal services.

Famous letters

Rainer Maria Rilke's Letters to a Young Poet
Martin Luther King, Jr.'s Letter from Birmingham Jail
The Pauline epistles
Samantha Smith's letter to Yuri Andropov
Virginia O'Hanlon's letter to the New York Sun, replied to in a famous editorial
The Zinoviev Letter, which affected the outcome of the United Kingdom general election, 1924
The Canuck Letter, which affected the outcome of the 1972 U.S. Democratic primary elections

List of national postal services

An Post (Ireland)
Australia Post (Australia)
Bulgarian Posts (Bulgaria)
Canada Post (Canada)
China Post, ???? (Republic of China)
Correos (Spain)
Correos de Costa Rica SA (Costa Rica)
Correios (Brazil)
CTT (Portugal)
Deutsche Post (Germany)
De Post, La Poste, Die Post or The Post (Belgium)
Hongkong Post (Hong Kong)
Indian Postal Service (India)
Indonesian Post - Pos Indonesia (Indonesia)

Íslandspóstur (Iceland)

Japan Post (Japan)
Jersey Post, (Jersey)
La Poste (France)
Magyar Posta (Hungary)
New Zealand Post (New Zealand)
PhilPost-Philippine Postal Corporation (Philippines)
Poczta Polska-Poland
Post Danmark (Denmark)
Poste Italiane (Italy)
Posten (Norway) (Norway)
Posten (Sweden) (Sweden)
Po?ta Srbije (Serbia)
Po?ta Român? (Romania)
Postverk Føroya (Faroe Islands)
PTT (Turkey)
Royal Mail (United Kingdom)
Russian Post (Russian Federation)
Sociedad Estatal Correos y Telégrafos (Spain)
Suomen Posti (Finland)
Swiss Post (Switzerland)
TPG Post, formerly PTT (The Netherlands)
United States Postal Service (USA)
?eská po?ta (Czech Republic)

References

Chronology

Key Dates:
1980: Mail Boxes Etc. is established and the first store opens in Carlsbad, California.
1982: The first area franchise is sold.
1983: Founder DeSio gains controlling interest in the firm.
1984: The company becomes partners with the United Parcel Service.
1986: The company goes public.
1988: MBE opens its first international outlet in Canada.
1990: More than 1,000 franchise locations operate worldwide.
1992: Revenues reach $36 million.
1993: The company launches 'Big or Small. We Ship it All' shipping program.
1995: The company introduces first-ever national ad campaign, 'It's not what we do, it's how we do it.'
1997: U.S. Office Products acquires MBE.
1998: The company opens the 3,000th outlet in the United States.
1999: The company's on-line business center is launched.
2000: More than 4,000 outlets operate worldwide.

Additional topics

Company HistoryTransportation Services

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