Australian Newsagency Blog

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Newsagency business analysis: for a newsagency without lottery products

Mark Fletcher
May 6th, 2014 · No Comments

Here’s an analysis I did last week for a newsagency that does not have lottery products. This business is in a town with economic challenges. It’s a business navigating changes.  While there are some numbers that are not ideal, there are others showing opportunity.

Thanks for sharing your Jan-Mar 2014 versus 2013 data. I have looked through this and have some comments of the results.

Being a newsagency without lottery products you have the challenge of needing to generate traffic for what you sell only – i.e. you can’t rely on the regular lottery purchase or superdraws to drive traffic. I think this leads to a more pure retail situation you can leverage as the good retailer you are.

Overall, I can see your traffic is down 9% yet your revenue is only down 5%. This means you have lifted efficiency – I can see this in items per sale, average sale value and average item value … all good measures to indicate efficiency.

  1. Cards. With this department delivering 9.93% of your sales, it is vitally important. While sales overall are down slightly, your Valentine’s increase of 13% is excellent. What did you do differently for Valentine’s Day? Whatever you did this year worked for you. It shows you can achieve growth in cards. If I were you I’d ensure you have the optimum range for your shop plus I would be looking at ways to drive card sales outside the card department since your customers have shown they like buying cards from you.
  2. Gifts. Your sales are up 5% for this department which accounts for 3.25% of your overall sales. What is interesting is your massive increase in novelty – this category now accounts for 9.11% of gifts whereas in 2013 it accounted for 3.56%. This is an indication of what your customers will buy. However, it is important to segment your gift displays – targeting the shopper: male, female, old young, for self, for an occasion.
  3. Magazines. Your sales are only down 2% – ahead of the industry average. What is brilliant if the growth you have achieved for women’s weeklies. Your sales are up 3% for this category that accounts for 24.28% of your overall magazine sales. Whatever you did to drive sales of weekly magazines – do more of it as it has worked! Plus craft and hobbies – up 11%. Who says you can’t grow magazine sales!
  4. Stationery. This is a challenge for you. I suggest you focus on pens as these account for23.58% of your stationery sales. How can you promote this category? Where is it located? Is there an opportunity to refresh with an out of store promotion and a staff focus to drive up-selling? My core point is that focus is needed here.
  5. Toys. Great to see the result here. Keep building on your success.
  6. Plush. A great start in this category for you. Based on your card sales you should be able to triple your plush number easily.

Being a non lottery newsagency you need to work your shop floor differently to others. This means focussing more attention of keeping offers fresh, ensuring your window attracts shoppers and marketing externally to remind people in town that you offer an excellent shopping range and experience that can save them going to a bigger town to shop.

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Category: Newsagency management · newsagency of the future · Newsagency opportunities

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