Australian Newsagency Blog

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

Retail newsagency sales benchmark results: April – June 2018 vs. 2017

Mark Fletcher
August 7th, 2018 · 15 Comments

The core category challenge continues for retail newsagencies while new categories grow.

This newsagency sales benchmark study reflects sales results as tracked in 153 retail newsagency businesses in Australia for the April through June quarter of 2018 compared to the same period in 2017.

Only businesses with accurate data are included in the study. There is no banner group dominance, nor is there city over country dominance.

In collating data, I remove businesses at the extremes where other factors are at play such as major construction or a newsagency in a centre with two newsagencies where one closed and thereby giving an unnatural boost to the other.

Each data point is the average, mean, of all data for the data point.

In assessing results at the category level, I have only included data for each category businesses trading in that category.


  • Customer traffic. Down 4%
  • Overall sales. Down 3.5%
  • Basket depth.
  • Basket dollar value.


  • Newspapers. Unit sales. Down 8.5%.
  • Magazines. Unit sales. Down 8%.
  • Greeting cards. Revenue. Down 4%.
  • Stationery. Revenue. Down 10%
  • Lotteries. Revenue. Flat.
  • Tobacco. Revenue. Down 16%.
  • Agency. Parcels, gift cards, betting account top-up. Down 6%.


  • Gifts. Revenue. Down 5%.
  • Toys. Revenue. Up 6%.
  • Plush. Revenue. Up 3%.
  • Collectibles. Revenue. Up 3%.
  • Craft. Revenue. Up 2%.
  • Coffee. Revenue. Up 15%.

What does this mean?

It was a tough quarter on all fronts. While there certainly are businesses achieving excellent growth, too many are not and this impacts the results.

My take is that the decline in traffic the core of papers, magazines, stationery and tobacco is not sufficiently being replaced with new traffic. While some newsagents are well engaged in pursuing new traffic, the majority are not.

I don’t think there is sufficient attention on basket depth and basket value. These are important metrics.

Another point from this latest study relates to gifts. It is unhelpful to group all gifts together when I do know of considerable diversity in the products placed in this category. For example, one store has in gifts cheap china product while another shop has high value collectible pieces. How retailers categorise the products is up to them. I can only assess based on their categorization.

I want to comment on greeting cards. In the benchmark dataset, I can see sales data for all the major card companies. The overall, disappointing, performance I note is not isolated to one company over others.

I am concerned that I am seeing a sales performance trend for cards in newsagencies that requires attention.  While the first response to this by some newsagents will be to demand card companies act, I think the most important and immediate action will come from newsagents.

Newsagents have given over their card departments to card companies for too long. I think we need to exert control on the placement of cards in our shops. While a destination card department is important, we need to pitch cards to all shoppers. This needs to be done by us thoughtfully, creatively and energetically.

I think all newsagents need to act on cards rather than standing by and watching. You only need look at Coles to see their engagement with the category. Their changes started over a year ago and they continue today. Their pitching of cards outside the department continues because it works. We can learn from this.

We need to be proactive when it comes to cards. It is an important category for us. There is only upside available for us from being proactive.

The occupancy cost challenge – a note for landlords.

Landlords want newsagency businesses in their retail mix. They want the store with papers, magazines, lotteries and other core items for the channel. Often, they restrict the space available for non-core, imposing a low gross profit model on businesses, thereby increasing occupancy cost.

Newsagencies today cannot sustain occupancy costs of more than 15% … where occupancy cost the ratio of retail space cost to product revenue lus agency commission. The goal must be 11% for the business to be profitable and able to serve the usual level of debt needed for such a business.

Landlords need to be aware of the changes in product mix, the challenges of low-margin core products and restrictions they place on what businesses can sell. They need to be flexible on rent so newsagency businesses can be sustained and thereby provide the service they want in their centre.

If landlords want a newsagency business they need to price the space to reflect the nature of a sustainable business in that location rather than any premium rent they could get from a retailer with higher margins.


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

15 responses so far ↓

  • 1 Ken Wilson // Aug 7, 2018 at 7:03 PM

    “Landlords want Newsagents” only if they can sustain 25% rent to sales..that includes when all the surplus capitol is used and the home redraw has been exhausted. No landlord in sustainable retail areas is accepting rentals of 11%… Zilch, no one, nobody…Including Westfield..
    BTW, this is the only sales benchmark survey that your stores haven’t had double digit growth..bucking the trend of the Newsagency sector.


  • 2 Colin // Aug 7, 2018 at 10:32 PM


    I like the frankness in the presentation of the numbers.

    The gifts number does not surprise me, the feedback from suppliers is the quarter was difficult for all on gifts, with spend levels varying dramatically between different types of gifts. I think we should all remain optimistic on gifts.

    Stationery is of great concern. For some time we have seen the accelerating decline of stationery sales. Clearly we are not alone.

    Regards card sales, can you elaborate more on the comment “not isolated to one company more than others”. I can relate to the 4% decline, but as a retailer with close to 2000 pockets and several suppliers, we are seeing large variances between the performances of suppliers. Some are doing very well, others not. I see the consolidations and exits in the sector as evidence of this.


  • 3 Mark Fletcher // Aug 7, 2018 at 10:32 PM

    Oh, Ken, let it go. You lost more than $2m of other people’s money in your collapsed newsagency businesses. You comment here to distract from the posts. Go away.

    This benchmark is not of my stores. If is of close to 200 independent newsagencies from multiple banner groups and independents.

    The landlord approach is different to back in your day. But, by all means, continue to talk the channel down as you do.


  • 4 Mark Fletcher // Aug 7, 2018 at 10:43 PM


    On stationery, I have a couple of national supplier meetings coming that I hope may lead to a path forward. I would also note that I think there are emerging opportunities in stationery but outside what we have seen as traditional stationery.

    On gifts, what is interesting is the question about what constitutes gifts. I think there has been a shift there, beyond most of what one sees at the gift fairs.

    On cards, I have seen data for all the major suppliers. Where a card company has the majority of space allocation it is usually in decline. Those with a considerable smaller allocation do better because they can focus only on top selling cards. I firmly believe that the next steps on cards are on each of us retailers. Supermarkets and others are more engaged in-store with the category than many newsagents.


  • 5 Graeme // Aug 8, 2018 at 10:11 PM

    Mark, I beleive you have hit on the performance of greeting cards per pocket exposure.
    This is really a subject that affects the “over cardage” in newsagencies as in the space allocated to magazine performance.
    It is a retail nonesense that more is better, quite the reverse, sales per sq. mtr of quality merchandise takes a little more surveylance howver produces lot’s more profit. Maybe lot’s of large companies have large large inefficient over presented displays in categories. This represent a lazy “supplier” attitude just because they have the space byoriginally buying it and now no longer earning it.
    Time to do a pocket count on turnover, pulling numbers, and sales rebates based on buying – not sales.


  • 6 Mark Fletcher // Aug 9, 2018 at 1:16 AM

    Graeme, looking at pocket turn and other data I don’t think ‘over cardage’ is as much as a problem as retailer disengagement. We need to stop seeing opening our front doors as a marketing g activity. rather, we have to work hard to attract shoppers. That is on us, not suppliers.

    If every newsagent engaged in out of store card promotion and encouragement of people to send cards our position would be better. However, few newsagents do this. They expect others to fix it.


  • 7 Graemel // Aug 9, 2018 at 6:08 AM

    Yes, there are both parts to the equation of better retailing, stock control and this includes supplier supervision as well as promotion Both are essential.

    I find the best performances are achieved where the retailer and the supplier work together on the supply side and the retialer really moves on the promoting side.


  • 8 Graeme // Aug 9, 2018 at 7:48 AM

    Hi Mark, “over cardage” I stated, not “over carnage” there is a difference. One could be inherit the other deliberate.


  • 9 Mark Fletcher // Aug 9, 2018 at 8:49 AM

    Fixed carnage.

    On the core issue, yes, there will be different opinions. Mine is that right now we need a massive shift in retailer focus. If that was to happen it would leverage supplier action.

    While suppliers have plenty they could do, they have, most at least, reset their businesses in the face of considerable change. I think the next move is up to newsagents, if they want cards to play a key role in their businesses.


  • 10 Graeme // Aug 9, 2018 at 10:25 AM

    I agree it is a partnership between supplier and newsagent.
    Your suggestions re the promotion of cards is very much of benefit to the newsagent in creating that impulse sale as well as reminding the consumer that we are premium card retailers.


  • 11 Colin // Aug 10, 2018 at 7:32 AM


    I agree the larger suppliers can have the worst performing cards. One reason for this is that their computer driven systems for filling pockets do not address the underperforming pockets that do not need filling. I know this from bitter experience. I now review all pockets at least a year and insist on all underperforming cards be credited and replaced with new designs, especially where cards are double pocketed. The card companies will tell you their systems do this. My experience is they do not.

    Also, I insist staff put cards out and not the reps. This helps educate staff on card location thus enabling better customer service.


  • 12 Mark Fletcher // Aug 10, 2018 at 11:01 AM

    Colin I have not said the larger suppliers have the worse performing cards. We do not agree.

    One card company has a human, local area, store based card allocation process for some retailers.


  • 13 Colin // Aug 10, 2018 at 10:02 PM


    Ok my wording was incorrect, they could also be small companies. I meant large suppliers meaning “majority of space allocation” . I was talking about exactly the same as you.

    More than one Company has human , local …etc. we have 3 for sure. But I also have direct experience of 2 Companies who do not have this approach. It is these I am talking about. One is certainly about as large as they get, the other less so.


  • 14 Mark Fletcher // Aug 11, 2018 at 5:46 AM

    There is a difference between how card companies work between accounts. Between mass and indie for example and between groups and indie too.


  • 15 Colin // Aug 11, 2018 at 9:54 AM

    There certainly is, we hear the stories of how the merchandisers of one Company have to do repeated rotations for one key account.

    And we also here the stories of merchandisers putting out stock, received by EDI, where the delivery has never been opened. Happens both in Indies and group stores.


Leave a Reply

Your email address will not be published. Required fields are marked *

Reload Image