Australian Newsagency Blog

A blog on issues affecting Australia's newsagents, media and small business generally.

2017 and the small business newsagency in Australia

Mark Fletcher
January 1st, 2017 · 11 Comments

I sat down yesterday to write a post about what 2017 holds in store for Australian newsagents and their businesses and the resolutions we should contemplate. I have decided that would be a waste of time.

Everyone in the channel knows what will happen. But here is a list of what I think will happen in Australia anyway:

  1. Magazine sales will continue to decline. Some magazines will close.
  2. Newspaper sales will continue to decline. Some daily newspapers will cease to publish daily.
  3. Tobacco product sales will continue to decline.
  4. Stationery sales in newsagencies will decline.
  5. Greeting card sales in newsagencies will decline.
  6. Over the counter lottery sales will decline.
  7. At least 400 retail newsagencies will close.

The situation will be worse than it need be because too many suppliers ignore the specialist nature of our channel and too many newsagents do not run competitively engaged businesses. These are suppliers who chase mass, thinking that is the answer (when it is not).T hese are the retailers who think opening their door in the morning is the only marketing activity in which they need to engage, the retailers who only buy from traditional suppliers, the retailers who are more comfortable as agents than entrepreneurial retailers, retailers who see the ownership of a business as their pension rather than a career.

The resolutions for 2017 ought be: chase change is if your life depends on it, do less agency revenue and more 50% GP and more revenue. Chase having people asking if they are in a newsagency when they are in your shop.

Challenging their perception of your business ought be mission critical in 2017.

Selfishly, though, here is what I’d like to say – if you are not going to seriously change your business and would prefer instead to coast on the tracks of steady decline in traffic, revenue and profitability, shut up shop now and get out of the way. A decaying retail newsagency harms the many others who are transitioning their businesses. A decaying newsagency is taking some revenue the rest who are here for the long term could benefit from for a brighter future.

The thing is – I don’t want you to close or decline. I want every newsagent to be in the group of transformers. I want every newsagent to be experiencing seriously growing overall GP percentage. I want every newsagent to make more money fro their business in 2017 than they did is 2016. But achieving these things requires a change in mindset, renewed energy and guts to stop being an agent.

Imagine the power we would unleash is the 3,000 newsagency businesses in Australia today all turned 90 degrees or more away from their current path. We can take on supermarkets, gift shops, toy shops and other retail channels if we play outside what has been traditional for our channel. I am optimistic that enough are doing this and more will join them. For those there can be good times ahead.

I guess that brings me to the simplest resolution: nice as traditional is, for newsagents there is no future in being traditional so stop it, ditch it and go make your own business based in what you want to stand for in your local community.

In 2017, let your business whatever that is and not a business defined by an out of date shingle.

23 likes

Category: Newsagency challenges · Newsagency management · newsagency marketing · newsagency of the future · Newsagency opportunities · Optimism

11 responses so far ↓

  • 1 Colin, Malvern SA // Jan 1, 2017 at 8:27 AM

    Brave words with which I fully agree. The sooner the decaying outlets disappear, the better the chance that transforming newsagents can be seen as valuable local businesses.

    However 400 plus closures is scary. Where will that leave the traditional suppliers and the legacy organisations. There is a danger of snowball effect developing with supply structures collapsing, taking with them transforming businesses.

    1 likes

  • 2 Mark Fletcher // Jan 1, 2017 at 9:26 AM

    There is that danger Colin. Some suppliers have moved already. We hit 350 in 2016. The biggest gain opportunity is from suppliers not traditional to the newsagency channel.

    0 likes

  • 3 shauns // Jan 1, 2017 at 9:30 AM

    Number 3 tobacco sales . While I do not sell them anymore well I haven’t for quite a few year ,from what I hear there is a hell of a lot of money still there to be made out of them .This month we have a tobacconist opening up next door and what they have forecast to sell blows my mind . The Manager of Woolworths also confirmed what the forecast to loose in sales when they open .

    0 likes

  • 4 Mark Fletcher // Jan 1, 2017 at 9:34 AM

    Shaun there is plenty of money out there but last year sales national declined 13%. What is happening is revenue is shifting among those who sell them.

    0 likes

  • 5 Kerrilyn // Jan 1, 2017 at 10:59 AM

    hear, hear! Totally agree! Bring on 2017 for a new generations of news”somethings” – but agents we are not! #notanewsagent #newgeneration #newbeginnings #traditionalfoundations #betterbusiness

    1 likes

  • 6 Mark R // Jan 1, 2017 at 12:42 PM

    Its time now for the Newsagency shingle to come down we must rebrand with a new name

    3 likes

  • 7 ed // Jan 1, 2017 at 4:13 PM

    Just shoot me now Mark it’s not that bad is it. I like to think of newsagents becoming more streamlined in how we trade. Shorter hours 6-4pm ideal shop size 35-50sm less rent move the shop if you have to, fill the shop with noise tv,music, 450-500 pocket mags papers center stage, still the main drawcard, sell ink and good brand stationary cheap deliver everything only buy gifts that you like. specialize in something with a small footprint.maybe learn how to change a watch battery,buy low sell high and good luck.

    0 likes

  • 8 Mark Fletcher // Jan 1, 2017 at 4:24 PM

    Ed I could be wrong but I don’t think the business you have described is a future model for the channel. It may work in some cases but I suspect not many. C-stores and similar small footprint businesses are doing what you describe in some categories.

    3 likes

  • 9 Chris // Jan 1, 2017 at 6:16 PM

    I still see a future in stationery if you want to pursue it. We have recorded growth year on year for the last 3 years with 2017 targeted as being even bigger. This is with ranges not from GNS as there is some awesome product out there.
    I am really positive about 2017 and I feel this way due to the steps I have taken over the last 5 years.
    I am not worried if suppliers move on as there is a big world out there full of ideas and new products I can stock.
    Bring it 2017, the year of higher GP

    3 likes

  • 10 Colin // Jan 1, 2017 at 9:39 PM

    Ed,

    I’m thinking at least 120 metres, 1200 cards, 40% gifts, excellent wrap and 400-500 mags displayed alongside gifts … no papers, agencies or stationery…and an open mind on books

    4 likes

  • 11 Brendan Mason // Jan 4, 2017 at 7:28 PM

    We’ve stopped all electronic transactions due to the very low margin. Papers are just hanging in there and magazines, while a can’t see them disappearing, are having to fit in a smaller space and earn there keep or be cancelled. Cards are our hero in both stores followed closely by a range of new products introduced to us by a very proactive group.

    1 likes

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