Customers who patronize the postal substation at Medford's Black Oak Pharmacy are disappointed the popular site will close in early April.

Customers who patronize the postal substation at Medford's Black Oak Pharmacy are disappointed the popular site will close in early April.

Black Oak management said the service takes up too much real estate and is a drain on the bottom line.

"I don't want them to close it," said Sherri Forrest, who comes to the pharmacy's substation several times a week to pick up and mail packages for work.

"Now we'll probably go to the main post office in Medford," said Forrest.

"That's a hassle. It was awfully convenient to come here."

Ann Brewer concurs.

"This is so wonderful to have this here," Brewer said.

"This is where we come. We don't want to have to go to downtown Medford."

The women's complaints are typical of what Betty Claunch has been hearing in recent weeks. The Black Oak Pharmacy clerk has been helping customers at the substation for the past five years of her 15-year employment at the pharmacy.

"My opinion is this end of town needs a substation post office," she said.

There is no doubt the service and location are convenient for the customers. But the substation is not profitable for the pharmacy, said Steve Boe, Black Oak Pharmacy store manager.

"It loses money every month," he said.

The substation will close on April 8. A 120-day notification has been posted, Boe said.

The closure is prompted by the pharmacy's coming move to a smaller location in the Siskiyou Medical Building near the northeast corner of the Rogue Valley Medical Center at the end of May. The focus will be on home health-care items. The pharmacy has purchased a large property on Crater Lake Highway to house its business offices and inventory storage, Boe said.

The pharmacy's smaller location near RVMC has Boe whittling out other nonprofitable parts of the store. In addition to the postal substation, gifts and cards will get the ax, he said.

"We can't afford to pay for space to have $1.98 cards," Boe said.

While Black Oak Pharmacy has received a revenue share off sales at the postal substation, it also pays to staff the station. And revenues are not sufficient to justify moving the postal space into the new, smaller location, Boe said.

"There's a lot of emotion over this issue," he said. "We're told we're at the maximum revenue share."

Boe said the number of postal substations are in decline, in part because changes in the U.S. Postal Service have driven a lot of business onto the Internet, further slashing revenues of stores that offer postal services.

"They began allowing online postal services which competes," said Boe. "And they started allowing mail carriers to collect packages. It took a significant portion of our business."

Bernice Stevens came by to drop off two unwanted packages she'd received in the mail, she said.

"OK, Sweetie. I want to get rid of this crud," said Stevens, handing the two parcels over to Claunch.

The transaction did not result in a sale for Black Oak, since the packages were returned to the shipper free of charge. But it saved Stevens a trip downtown, she said.

"I came by today because I didn't want to stand in line in the Medford post office," said Stevens.

Boe appreciates the concerns of the senior customers who struggle to walk far, stand in long lines or even drive to town. But as costs have gone up to house the substation, revenue has gone down, he said.

"These are things we have to rassle with," Boe said. "We served the postal patrons for a lot of years. And we should have closed 25 years ago from a strictly financial basis. At this point, it is cost-prohibitive per square foot of space to continue operating the postal substation in this prime real estate area."

The full-service pharmacy is trading off the demands of the substation to offer even better service for its pharmacy and home health care customers, Boe said.

"We're trying to fill a lot of needs in one place," said Boe.

Reach reporter Sanne Specht at 776-4497 or e-mail sspecht@mailtribune.com.