What is it about Australian capital cities and newsagencies. Well, Melbourne, Sydney at least. They used to boast several good ‘full service’ newsagencies. Now they are nowhere to be seen. Instead we have convenience stores on every street corner.
I am in Sydney today and needed something only a newsagency would carry. While Sydney has a good number of News Stands, as they are called, the main CBD streets lack a newsagency or two.
I suspect that rent has a lot to do with this. Our slim margin businesses don’t work when you are paying close to $2,000 a square metre for retail space.
It’s a pity. Tourists wandering Sydney streets mixing sightseeing with shopping are missing on a quintessentially Australian retail experience.
Same does apply in Perth as well. All the newsagencies in Perth are heavily run down/out of date or uncared for. As of July 2 of the CBD newsagencies STILL were running the bill express loop on their Screens! disgusting.
Mark,
On my figuring to rent a 100 sq metere retail space (not including storeroom-office etc)at $2,000. p.s.m. p.a. you would need to turnover $2m in shop sales $1.5m in Lottery sales to net the owners (2) $100k p.a.
There lies the answer as to why they have been relplaced by convenience stores and kiosks-even the kiosks have diminished in numbers and the existing ones are finding it harder to make a living. A large newsagency in these capital cities will in the future most likely be inside an existing store- Myer-David Jones -Borders-A&R -Dymocks etc IF they can afford the space!
Good point Graeme,
As Borders,A&R and Supanews are under the one umbrella imagine the synergy of that combined retail offering under the one roof in a mjor shopping centre. Could be a sign of things to come
No wonder we sell heaps of magazines in the holidays to the city folk who venture outside of the big smoke. I hear all the time about how their newsagent doesn’t carry any range of stock any more.
Heather
Albury
Heather,
The main reason you sell more to the city people on holidays is that they are on holidays. Not many people live in the CBD areas of the Big Smoke and I assure you the suburbs have very well stocked newsagencies, some turnover $15-$20k per week.
Enjoy the sales and don’t take too much notice of the ‘Holiday” banter
Graham,
You see a lot of figures. Do you have averages? Like what is the average turnover of mags in an agency in a shopping center or what is the average stationery sales for such an agency? Those numbers would be handy to know to see how you stack up vs an average.
Brett,
Mark does a benchmark shopping basket of compararitive products. I only do it by the sq metre for it’s the amount of space allocated and the mix of product withing the department that maximises sales. I tend not to generalise as it is not apples to apples and individuals get the wrong steer.
Mark’s comparison is accross, I believe 30-50 newsagencies and it will tell you if mags are up or down as a percentage etc This is useful to let you know how you are fareing in comparison. Foe example magazines in two shopping centres can range from $14k per week (sales) to $19k per week. $5k per week is substantial. What areas one is south side the other north side. What sq. metres allocated one 20 sq metres the other 28 sq metres. The real question is Is the space paying for itself or is it efficiently profitable per sq metre versus the rent, wages and other expenses at 25% Gross Profit?
Brett,
Mark does a benchmark shopping basket of compararitive products. I only do it by the sq metre for it’s the amount of space allocated and the mix of product withing the department that maximises sales. I tend not to generalise as it is not apples to apples and individuals get the wrong steer.
Mark’s comparison is accross, I believe 30-50 newsagencies and it will tell you if mags are up or down as a percentage etc This is useful to let you know how you are fareing in comparison. For example magazines in two shopping centres can range from $14k per week (sales) to $19k per week. $5k per week is substantial. What areas one is south side the other north side. What sq. metres allocated one 20 sq metres the other 28 sq metres. The real question is Is the space paying for itself or is it efficiently profitable per sq metre versus the rent, wages and other expenses at 25% Gross Profit?
Forgot Stationery:
Stationery is by far the biggest variant when the amount of space is allocated. Because it can be “bulked” in sale as in stacked like a pallet of copy paper etc and there is more variety in product lines, more sales can be achieved per sq metre over more space.
Cards are the trick. By measuring your fixtures space versus per sq. metre)plus the number of cards per pocket plus the number of pockets you’ll find that a card cabinet measuring .650 from the wall and 1.5 metres lineal will give you approx 1 sq metre of floor space add in the number of pockets x the cost of each unit (wholesale) and you can work out your stock turns per annum. It’s quite a shock to see in some cases the amount of inefficient space allocated to these departments, mainly because years ago, the card companies bought the space and subsequent newsagents have “carried” on as before without checking today’s costs vesus sales and profit.
Graeme, My benchmarks usually involve 110 newsagencies or more.
Thanks for that I wasn’t sure but new it was significant enough to show a trend in sales data accross the board.