Here are some notes I put together for a newsagency business I assessed as part of the October / December 2013 vs. 2012 newsagency sales benchmark study I did last month. These notes are for a smaller town newsagency currently offering a very traditional mix of products. Here’s some of what I found:
Your newsagency appears to be a traditional newsagency business with a focus on lotteries (57% of sales), magazines & papers (30% of sales) and a bit of cards and stationery.
This mix of products does not give you a bright future in that for the vast majority of your business you are relying on others to drive traffic. If lotteries, newspapers and magazines decline or those customers defect to other retailers you will be in a difficult situation.
A way to address this is to focus more on products and services over which you have control and through which you can advocate a point of difference.
What your point of difference? What do you think it is? It’s essential you have one – beyond being a newsagency. In your data I cannot see a point of differenced reflected. While your sales decline of 3% is less than the average for declining newsagencies, it is not a good story.
Based on your care sales I suspect you could increase gift sales by 300% or more. Plus I think you could sell more in toys and plush – I’d suspect at least $1,500 in each in the October – December quarter.
Tough as it is in a town your size (pop. circa 3,000) I’d look carefully at the businesses nearby, if you have anyone selling gifts, what are they selling? I ask because I know newsagencies in towns this size that have lifted gift sales to match card sales. If you could do that you’d see your GP for the year increase by between $10,000 and $15,000. This, in turn, would make your business more valuable.
I think mission critical to your business right now is getting known for something other than magazines, newspapers and lotteries. You need another valuable point of difference. Something that could attract people from nearby towns to your business to shop.
If I were you these are the issues I’d be considering to make the business more successful and more valuable.
We have to break free from the past and from the agent mentality. Our future is as retailers.