Thanks to the 109 newsagents trading under various clapboards who provided sales data for this benchmark survey. Your transparency will help many in our channel.
Newsagents generally had a good first half of 2022 when comparing trade figures to 2021. While reported increases are modest, this is on the back of an better than good 2021 due to Covid.
Of particular importance are strong performance for gifts, magazines, books and toys.
The results show that the local news agency is a company with a strong traffic and revenue core. They also show opportunities given the growth in some categories for some and not others.
While this latest news agency sales benchmark study doesn’t include malls because the sample was too small, I note that they seem to have had a tough first half — begging a question about the status of the mall’s institution.
After comparing data from the companies in the benchmark dataset, here are the: averages for business performance metrics and categories, comparing January to June 2022 with the same months in 2021:
- Revenue: up 2%.
- Number of sales: down 1%.
- Shopping cart: up 8%.
- Items per basket: 6% higher.
- Average item value: Up 7%.
- Greeting card income: 2% lower.
- Unit sales of magazines: down 4%.
- Income from toys: an increase of 6%.
- Gift Yield: Up 8%.
- Book turnover: up 7%.
- Stationery income: 5% higher.
The percentages are small, especially if you look at 2021 over 2019, but that earlier comparison was comparing pre-Covid to Covid, which was huge for major newsagents.
Since the above results are averages, some are significantly lower and some are significantly higher.
In terms of business type, the best performing newspaper agencies I see in the data are the suburban high streets, followed by the regional/rural high streets.
What’s not in the benchmark results above is interesting. There are some newsagents that are experimenting with success. Household items, white goods, hardware, and eyewear are all categories that have seen a growth in reports for a small number of participating companies. I see several ranging from $0 to a reasonable number at the introduction of the category.
Some newsagents also discontinue categories such as ink and toner toys for some and some agencies.
There are also interesting data within departments, such as stationery and magazines:
- In writing paper, sales are strong for everyday items such as pens and paper and less for less frequently purchased items. For example, pens still account for about 30% of all stationery revenue in newsagents with strong pen sales. Given their percentage of space allocation and capital requirements, this makes pens a valued segment. I wonder if there is an opportunity for newsagents to price some stationery with a convenience premium.
- In Magazinesweekly magazines showed the largest decline, averaging 9%, followed by women’s interests, while special interest, crossword puzzles, and crafts and hobbies experienced above-average growth to support magazine’s overall performance.
In this benchmark data set, there are 2 newsagents that introduced gifts, toys and plush to their business. In any case, the three new categories accounted for more than 6% of total sales over the six months. One company introduced trading cards mid-six months and made over $12,000 in revenue.
The challenge of shopper traffic.
A major challenge I see in the benchmark data is shopper traffic.
Our channel was built to be a destination for newspapers, magazines, cards, lotteries, stationery and, in the past, tobacco. We opened the front door and people came in. Newsagents were businesses that took advantage of the habit-based shopper.
Those days are gone, even more in the city than in the countryside, but they are gone.
We need to work harder to attract shoppers by offering a wider range: habit based products and by showing people how to make a purchase, by educating them, by seducing them. We do this by being smarter and more engaged retailers, and by doing these things internally and outside our stores.
Every newspaper agency, every retail business needs a new customer traffic strategy, because if the customer base doesn’t grow, the future of our businesses is at stake.
Stock what might attract new shoppers, display it for passersby to see, pitch on social media.
If everything we do with something new puts it on the shelf, we fail that new traffic opportunity.
The flight home to Christmas
July through December are critical for any retailer. Maximize the opportunity:
- Get out and about as early as possible for Christmas.
- Continue to attract new shoppers.
- Stop doing things that don’t make you money, like adjusting opening hours.
- Stop dead stocks.
- Track any green shoots in your business records, every business has them.
- Be careful with your schedule.
- Make your store look its best.
I’m saying all of this because, while our channel is delivering good results, we’ve got plenty of competitive retailers that have the energy to bring in business, and you don’t want them to win it over.
The next six months are important because they may make you want to sell next year, put more money in your pocket and help you enjoy your business more.
I own and run four newsagents. Over the years I’ve had three more. I own newsXpress, a newspaper agency marketing group focused on helping newsagents attract new customers.
M | 0418 321 338