Here is another newsagency performance assessment I have undertaken. This business is interesting in that they have taken some excellent steps that are paying off and now they want to achieve more. Here is what I have written to them after looking at their data:
In reviewing the performance of the business I’ve looked at your sales and basket data for May through July this year compared to the same period a year ago. While I understand the business is quite seasonal, I am comparing like for like.
Some comments I make may come across as rude. That’s not my intention. The facts as I see them are the facts. This is where data is vital in guiding business planning and decisions. I see too many newsagencies being run on gut feel and emotion and not enough running based on data.
- Overall traffic. Down 3%. While this is within trend for newsagencies, you need to be considering what you can do to drive new traffic. This could include promotion outside the business, window displays, community engagement or a host of other ideas. The question you have to ask is: what am I doing to attract more shoppers to my business? I appreciate this is challenging in a small town but take your time and think about what you could do to atract people from, say, 20km away. Don’t restrict your view of your business to only those nearby.
- Cards. No change in sales. While this is okay in that sales have not dropped, they have not grown either. 23% of your cards are in unknown category. This needs to be fixed. Call the help desk and your card co to sort out why electronic invoice data is not being allocated. That said, there is some interesting data: 5.88% of card sales are sympathy! Cards overall account for 10% of your sales. It’s vital this is lifted to between 15% and 20%. This can be achieved with a card re-plan, marketing, a change in shopper engagement and maybe a rewards program for card shoppers. With your annual card sales at around $60,000 I suspect you could negotiate a more valuable card supplier relationship.
- Gifts. This is a terrific success story you’ve built. Sales of $5,235 – up 24% year on year. The only problem is that you are not categorising your gifts so it is hard to see what is selling and what is not selling. Your ration of gift sales to cards is well above average – this is good news.
- Magazines. Your magazine sales are strong. I notice that Home & Lifestyle has 10.73% of your sales. This is above average. If you’re looking for new gift lines consider items in these types of magazines as your customers are in that space. Also you have strong craft magazine sales – 9.79% of total magazine sales. This is another example of guidance for gift expansion. Your magazine data indicates around two thirds of your shoppers are women or they are at least shopping for women. Magazines account for 39.02% of your sales. This is too high. The business needs balancing to higher margin lines.
- Stationery. Sales are down 2% which is not bad compared to others. I’d love to be able to provide more insights but your data does not allow this. You have to sort out unknown category by arriving stock electronically and allocating this to categories within stationery. Otherwise you don’t know what you are selling for sure.
Given your location, in a country town with a population of 800, I can imagine that you see your opportunities for growth as being limited. maybe in the immediate area they are. I think it’s important to not be bound by borders as you see them. I also think its important you run your business as if your toughest competitor is right next door. Aim to be the best retailer in town.
Here are my thoughts on how I might approach your situation and desire for growth. Some are easy to implement immediate options while others involve research and planning. Some are mutually exclusive. Consider the list a list of options for your consideration:
- Decide who you are. What do you stand for, what is your unique selling proposition? Decide to be the best gift shop in the area, not just the town by the area. Plus the best card shop. Make it so people happily drive half an hour to get to your shop. Yes, this takes investment. Take your time. Develop a plan and make small steps toward this.
- Use your windows. From Google Street View I can see you’re in a good situation with excellent windows facing the street. Use the windows to make bold statements. One window could feature traditional newsagency lines and the other window could feature gifts. Retreat from tradition with magazine posters in front and give your windows over to bold create statements about your offer and about community connection. Develop a marketing plan. For example: in one window promote craft titles and maybe a local craft club and in the other window Spring Gifts (if you’re doing the display now).
- Entrance. from the front door through entice me into the business. Do this with fresh product placement from inside the door to the key destinations in your shop. Always look at your shop from the perspective of your shoppers. Break with tradition and break their expectations of what you sell.
- Look around you. Look at other shops in town that you can compete with. This is retail today, especially for a newsagency. there is nothing you sell that others cannot sell. So, look at nearby gift shops if there are any. They are your competitors. Take them on if you are game. But not directly – be smart. Look at gift suppliers who can help you expand to attract people currently shopping with these other gift shops. This is a long-term strategy. take your time.
- Services. Are there more services you could provide. For example, is there a good coffee shop nearby? If not, is this an opportunity?
- Tourists. Given the influx of tourism you experience consider what you can do to connect with them. For example, in your data I can’t see much in the way of sales of plush. If your tourists have kids or are likely to buy for kids then a plush presence in store during the tourist season could work well. Your location means you could possible achieve an above average margin too.
- Connect locally. In you don’t already: have a local events notice board in-store; promote a local community group; publish your own monthly newsletter; advertise on local radio as it should be pretty cheap.
These are just some thoughts. The real goal of the list is to get you thinking. I’d be happy to discuss these options with you – 0418 321 338.
I spent my teen years in a country town with a population of 2,500 and worked in the local newsagents after school for a couple of years. While that was decades ago, I do have a reference point for country towns.
I am grateful to the newsagents who share their data for comment. I don’t publish all reports here, not even a fraction. Those I do publish I hope speak to others who may be in a similar situation.