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The village of Shrivenham in Oxfordshire has a population of about 3,000 people, thatched cottages, two pubs, a church dating to the 12th century, and a small post office. Jackie Adaway was standing in the latter last week, talking to Sarah and Matthew Thorne, the couple who run it.
“If I need a card, they’ll tell me what the greeting is and they’re friendly and helpful,” said Adaway, who is visually impaired and lives a 10-minute walk away. “It’s a social place. If I’m at home and feel lonely, I’ll come over here and have a chat.” As well as postal services and greeting cards, she uses the branch to deposit and withdraw cash.
Shrivenham is a thriving, affluent village, with golf clubs, horseracing stables and the UK’s Defence Academy, which trains military officers from around the world, in the surrounding area. But its Lloyds Bank branch shut a few years ago, and the post office is a vital commercial hub for many residents.
Rich Page, another villager, runs a Pokémon card trading business from his house and uses the branch to send out the cards by registered post. There is an Evri parcel dispatch and drop-off services at a local Co-op convenience store but he prefers the post office. “Some of the cards are extremely valuable and when I come here and see Sarah and Matthew, I know they’re safe.”
There is no question that Shrivenham post office, which the Thornes have run since 2009, has great community value. Whether it is a good business is another matter. As the Post Office tries to move on from the Horizon computing scandal and make its 11,500 branches more profitable for sub-postmasters who run them under franchise, Shrivenham illustrates the problem.
The Thornes received £104,500 from the Post Office in the last financial year for transactions such as parcels and selling postage. After paying rent, wages for four part-time staff and other expenses, they managed to draw £37,000 for the year themselves. In addition, they made £22,200 profit by selling cards and gifts such as tea towels and toys in their tightly packed retail space.
Earning £37,000 for running a post office branch puts the Thornes in the upper rank of sub-postmasters, but it equates to less than the annual legal minimum wage between two. “They’re doing better than most because 52 per cent of postmasters do not make any money at all,” says Elliot Jacobs, a Post Office non-executive director who runs a chain of stationery stores and post offices.
The gulf between the community value of post offices and their economic worth has widened as the traditional link with Royal Mail, which was privatised in 2011 and acquired for £5.3bn last year by the Czech billionaire Daniel Křetínský has stretched. Post offices handle fewer letters and there is competition for parcel delivery: Amazon has a logistics hub near Shrivenham.
The Thornes, for example, gain an average of about £1.50 for each special delivery parcel that a customer brings to the branch, pays for postage and leaves there. If the customer instead buys postage online from Royal Mail, prints a label and drops it at the post office, they receive 25 pence.
“It takes a long time to serve some customers because they want to chat. They are lovely people and I would not have it any other way, but at the end of it, I have earned 25p,” says Sarah Thorne, who formerly worked as a property lawyer, including for Linklaters. The Thornes hope to move soon to the former bank building nearby, which is larger, to offer wider retail and banking services.
The Post Office paid sub-postmasters £416mn last year and wants to raise this amount by £120mn by next year and a further £250mn by 2030 by cutting costs and increasing banking and other revenues. It is publicly owned and the government will soon issue a green paper on its future: the Post Office wants a longer-term charter to give it greater management autonomy.
But the tensions between personal service and financial logic remains. Jacobs’ UOE chain, which is backed by the private equity firm Next Wave Partners, has nine branches in and around London. He wants to acquire more post offices. “This is a great business at its core but you must work it hard and you need economies of scale,” he says.
In their branch, the Thornes need the rise in remuneration to come soon. “We have not taken a holiday in three years, partly because we could not afford to,” says Sarah Thorne. The government, the Post Office and the villagers of Shrivenham agree that their work is valuable. Making it pay is tougher.