Newsagency sales benchmark results: Oct – Dec 2020 versus Oct – Dec 2019

Based on sales data covering October through December 2020 and 2019 from 156 newsagency businesses across Australia in city and country locations, high street and mall, the latest newsagency sales benchmark study is revealing as to the impact of Covid on our channel and the value of location.

Revenue surge in Australian newsagency businesses during Covid.

Most too successful to qualify for JobKeeper as sales of some traditional and key new product categories surge.

• Gifts lead the revenue surge.
• Toys, games and jigsaws experience double digit growth.
• Magazine sales grow.
• Regional newspaper closures do not hurt business performance.
• Shopping centre newsagencies down, against the trend.

Let’s dive deeper into the results. This round of the benchmark I look at regional and city high street businesses. I have not broken out shopping centre businesses because the dataset is too small. The results from those stores for the quarter, however, are bleak.  Revenue down between 15% and 20%. Steep declines in magazines and newspapers. While some categories, like gifts did okay, performance was nothing like on the high street.

Regional high street businesses.

• Transaction count change: down 1%.
• Revenue change: up 11%.
• Basket size change: up 15%.
• Newspaper unit sales: down 10%.
• Magazine unit sales: up 5%.
• Card revenue: up 7%.
• Stationery revenue:  up 9%.
• Gift revenue: up 35%. 75% of businesses report selling gifts.
• Toy revenue: up 25%. 10% of businesses report selling toys.
• Puzzle revenue: up 35%. 20% of businesses report selling puzzles.
• Instant lottery revenue: up 16%.
• Lottery revenue:  up 4%.

City high street newsagencies.

• Transaction count change: up 2%.
• Revenue change: up 7%.
• Basket size change: up 10%.
• Newspaper unit sales: down 8%.
• Magazine unit sales: up 2%.
• Card revenue: up 7%.
• Stationery revenue:  up 6%.
• Gift revenue: up 20%.
• Toy revenue: up 15%.
• Puzzle revenue: up 18%.
• Instant lottery revenue: up 18%.
• Lottery revenue:  up 3%.

The gift percentages above do not tell the full story. There are some newsagencies that achieved 200% growth off a reasonable base in 2019 of $25,000 in gift sales. Also, there are some newsagencies that booked $200,000+ in gift revenue for the quarter.

Within gifts, homewares are surging with some newsagencies booking more than $25,000 from this segment alone in the quarter. fashion, too, is surging with some recording more than $15,000 in revenue from a segment that the year before contributed $0.

In terms of cards, there are some newsagencies reporting 40% and more growth. This has usually come about through significant shop floor and supplier related adjustments.

Note. 

These are averages. The gap between those doing well and those not doing well is considerable. It is important that newsagents look at their own data as the most important competitor they have is themselves. The trading period from the past against which you compare results is your competitor. Look at those numbers more carefully than you look at these benchmark results.

What have we learned from the last 3 months?

• There is much good news here.
• People prefer the high street over shopping malls.
• There is a feeling that the card shopper community has grown … more people are sending cards.
• The newsagency channel is healthy.
• The best growth is coming from categories over which newsagents have the most control – gifts, homewares, toys, games, puzzles, collectibles.
• Diversification in newsagency product offering is key to success.
• Having an online presence drives revenue growth.
• Postable gifts are selling well.

I am grateful to all newsagents who shared their data for inclusion in this study.

Mark Fletcher.
Email: mark@towersystems.com.au  Website: www.towersystems.com.au  Blog: www.newsagencyblog.com.au
M | 0418 321 338