Hey newsagents, what’s more valuable, making a few cents from a parcel pick-up or $75 in gross profit from selling a gift?
I was talking with a newsagent yesterday who was asking what I had against parcel pick-up in newsagency businesses. My opinion is my opinion for my own business. Everyone should make their own decision based on their circumstances and capacity.
For me, though, parcel pickup does not make sense and here’s why:
- It doesn’t pay its way. Accounting for the space and time, and considering the average volume, it’s unlikely you’ll read even let alone make any profit.
- Parcel collectors are not your shoppers. I’ve not seen any evidence of parcel collectors buying other items during the visit.
- Parcel collectors bring their baggage. I’m talking here about emotional baggage: frustration with parking, frustration about the supplier they bought from.
- Parcel collectors tend to not be patient. They are there for one thing only, which they think should take a couple of seconds and, often, think they should be served ahead of real paying customers.
Someone spending $150.00 on a gift in the shop delivers $50.00 in gross profit. They will, more often than not, buy other items during the visit and, more often than not, come back and buy more. The gift customer is stickier with your business, more valuable.
You’d have to serve between 75 and 100 parcel collections to achieve the equivalent of the $75.00 in gross profit from the gift sale.
Parcel collection in the Aussie newsagency channel is rooted in the days of newsagents being agents, making cents in the dollar for providing a local service over which we have little control and that relies on minimal business skill. Now I know some newsagents like the simplicity of it, that it does not require business skill.
Successfully selling gifts requires skill. Get it right and you can add hundreds of thousands of dollars to you business gross profit performance. yes, there are newsagents doing this. I doubt there are people achieving the same from parcel collection.
The other factor to consider about parcel collection is where the money is made. There are some spruiking parcel collection in the newsagency channel who are making money from it, a commission if you like. They are incentivised to talk it up to newsagents.
What’s more valuable, making a few cents from a parcel pick-up or $75 in gross profit from selling a gift? The gift sale, of course.
I have no skin in whatever decision you make. What I have written here is designed to give you more information to think about, so you have more to consider.
Ultimately, my focus is on long-term viability over short-term foot traffic. While the simplicity of parcel collection appeals to some, I prefer to invest my floor space and energy into high-margin categories that reward actual retail skill. Every square meter of your shop should be working to build your bank balance, not just a delivery driver’s efficiency.
You have to decide if you want to be an agent or a retailer, because in a competitive market, you can’t afford to let “busy-ness” get in the way of real business.
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My name is Mark Fletcher. I founded newsagency software company Tower Systems and I am the CEO of newsXpress, a marketing group serving innovative newsagents who continuously evolve their businesses to be enjoyable, relevant and successful. You can reach me on mark@newsxpress.com.au or 0418 321 338.




